THE  LIBRARY 

OF 

THE  UNIVERSITY 

OF  CALIFORNIA 

LOS  ANGELES 


SCHOOL  OF  LAW 


ILLUSTRATIVE 


CASES  IN   SALES 


BY 

PHILIP   T.  VAN    ZILE 

Dean,  Detroit  College  of  Law,  Deiroit,  Mich. 


ST.  PAUL 

WEST   PUBLISHING  CO. 

1896 


T 


Copyright,  189G. 

BY 

WEST  PUBLISHING  COMPANY. 


? 

f- 


These  cases  liave  been  selected,  net  as  leadiiij;  eases,  but  as  ilhis- 
trative  cases,  to  be  used  in  connection  with  ni.v  lectures  before  the 
law  classes  in  the  Detroit  Colleji;e  of  Law.  It  is  not  pretended  that 
the  subject  of  Sales  has  been  coviM-ed  by  these  cases,  but  sinijiiv  thai 
some  of  the  jMinripal  suiidivisions  have  been  illustrated. 

PHILIl'  T.  VAN  ZILE, 

Dean.  Detroit  College  of  Law. 


Detroit.  .Midi..  Sciit.  inli.  ISllC. 

VAN  ZILK  SEL.CAS.SALIis. 


(iiii* 


740123 


TABLE   OF   CONTENTS. 


SALE  DEFINED. 

A  sale  is  the  transfer  of  property  in  a 
thing  for  a  price  in  money,  or  a  consid- 
eration stated  in  money  terms. 

THE  CONTRACT   OF   SALE. 

Page 
To   be   valid,    the   minds   of   the   parties  to 
the   sale  must   meet  as  to  all  the   requi- 
sites of  a  valid  sale. 
There  must  be  mutualitv. 

— Topliff  V.  McKendree 3 

Deyo   T.    Vaughn 4 

There  must  be  a  consideration. 

— Tuttle  T.   Campbell. G 

TIME  OF  PAYMENT. 

^n  the   absence  of  stipulation,   express   or 
implied,   it    is    prestimed     that   payment 
will  V)e  made  upon  delivery. 
— Mclver  v.  Williams 9 

"A  contract  for  the  sale  of  building  mate- 
rials which  specifies  no  time  of  payment 
of  the  purchase  price  will  be  construed  as 
contemplating  payment  on  delivery." 
— Lnmont  v.  I>a  Fevre 10 


SALE    DISTINGUISHED    FROM    BAIL- 
MENT. 

— Crosby  v.  Delaware  &  H.  Canal  Co..     12 

If   the   identical   thing   is   to   be    returned, 
though  in  altered  form,  as  logs  into  lum- 
ber, wheat  into  flour,  the  transaction  is 
a  bailment. 
— Irons  V.   Kentner 15 

But.  if  identical  article  is  not  to  be  return- 
ed, it  is  a  sale  or  exchange,  according  to 
the  nature  of  thei  consideration. 

^Sturm  V.   Boker 16 

Crosby  v.  Delaware  &  H.  Canal  Co..      25 
•Tones  v.  Kemp 26 


INFANTS. 

Contracts   of   Sale   by   Infants   not   Void, 
bnt  Voidable. 

An  infant  may  liiud  himself  for  necessa- 
ries: and  an  executed  contract  of  pur- 
chase, if  reasonable,  or  not  so  unreason- 
able as  to  be  evidence  of  fraud  or  undue 
advantage,  cannot  be  repudiated  by  him. 

—Welch  V.  Olmstead 27 

.Johnson    v.    Northwestern   Mut.    Life 
Ins.  Co 28 

Transfer   against  Interest. 

An  infant  cannot  be  bound  by  a  transfer 
of  his  property  which  cannot  possibly  be 
for  his  benefit. 
— Bloomingdale   v.    Chittenden 31 

False  Representation  of  Full  Age. 

— Pemberton    Building    &    Loan    Ass'n 
V.  Adams   32 


Capacity  to  Buy  and  Sell. 

Capacity    to    buy   and    sell    is   oo-exleusive 
witii   iap;i<ily   to  contract. 
—Sec  Tiffanv  on  Sales,  tl. 


Page 


Ratification  and  Disaffirmance. 

An  infant  may  ratify  or  disaffirm  contracts. 

— Staek    V.     Cavanaugh 3.'l 

<Jregory    v.    Lee 3.5 

Langdon    v.    Clayson 37 

Tyler    v.    Gallop's    Estate 40 

Durfee   v.    Abbott 41 

If   he   avoid,   must   he,    as  a    condition   pre- 
cedent, return  the  consideration  in  siiecie, 
or    account    for    it?    The    authorities    are 
not  uniform. 
— Heath    v.    Stevens 43 

By  the  weight  of  authority,  if  he  has  con- 
sumed, lost,  or  sold  it  dtiring  minority, 
he   may,    nevertheless,    avoid. 

— Adams    v.     Beall 45 

Moley    V.    Brine 47 

Dube    V.     Beaudry 4H 

Contract  for  Necessaries. 

Infant  may  make  binding  contract  for  nec- 
essaries. 

—  Trainer     v.     Trumbull 40 

Englebert  v.  Troxell .51 

Wood    v.    Losey oii 

See,   also,    Welch   v.   Olmstead 27 

HABITUAL    DRUNKARDS. 

Habitual  drunkard  may  purchase  and  pay 
for  necessaries. 

— Brockway    v.    Jewell 57 


INSANE   PERSONS. 

One  may   recover  for   iieci-ssarics  furnished 
to    insan(>   persons. 

— Stannard    v.    Burns'    Adm'r 60 

In    re    Renz 65 

Alexander    v.    Haskins 6r> 

Every    person    is    presumed    sane.    Burden 
of  establishing  insanity  is  on  party  assert- 
ini;  it. 
■    — Blackstone   v.    Standard   Life  &   Ace. 

Ins.    Co 67 


MARRIED    AVOMEN. 

Rights  to  make  contracts  enlarged  by  stat- 
utes, but  can  contract  only  in  respect  to 
her   separate  property. 

— Gillesiiie     v.     Beecher 77 

Artmau    v.    Ferguson 7S 

J.    I.    Case    Threshing-Mach.    Co.    v. 
Mitchell     ." 80 


EXISTENCE    OF   THING   SOLD. 

It  is  a  well-established  rule  of  law  that 
things  having  no  potential  existence  can- 
not be  the  subjects  of  mortgage  and  sale. 

—Low    V.    Pew 83 

Bates    V.    Smith 85 


VAN  ZILE  SEL.  CAS. SALES. 


(V) 


TABLE  OF  CONTENTS. 


Page 
AA'here  one  possossos  a  thing  from  which 
a  certain  product,  in  the  veiy  nature  of 
things,  may  be  expected,  such  a  product 
has  a  potential  existence,  and  may  be  the 
subject  of  mortgiige  and   sale. 

—Dickey    V.     Waldo 87 

Senter    v.    Mitchell 91 

Hnll    V.    Hull 94 


PRICE  PAID. 

Where  property  is  taken  at  a  fixed  money 
price,  the  transaction  i^  a  sale,  whether 
the  I  trice  is  paid  in  money  or  goods. 

— See  Picard  v.  McCormick 216 

Every  transfer   of  property   for  an    equiva- 
lent    is     substantially     a     sale.      Money's 
worth     is     a     valuable    consideration,     as 
much   as   monev   itself. 
—See   Huff  v.   Hall,  23  N.   W.   S8,   56 
Mich.   450 

The  vendee  is  not  entitled  to  the  possession 
of  the  thins;-  sold  until  the  monev  is  paid 
to  the  seller. 

— Sanborn    v.     Shipherd 96 

Reasonable   price,    market   price,    etc. 

— Konntz    v.     Kirkpatrick 97 

If  the  contract  furnishes  a  criterion  for  as- 
certaining the  price,  that  is  all  that  is  re- 
quired. 
— :McConnell    v.     Hughes 101 


MISTAKE. 

When  it  is  evident  that,  through  some 
mistake,  each  was  assenting  to  a  differ- 
ent contract  or  understanding,  and  for 
that  reason  the  minds  of  the  parties  did 
not    meet,    there  is  no    sale. 

As  to  Things. 

^Wood    V.   Boynton 102 

Huthmacher  v.    Harris'   Adm'rs 104 

Sherwood  v.  Walker 106 

As  to  Parties. 

— Rodliff  v.  Dallinger 110 

As  to  Price. 

— Rupley   T.    Daggett 112 


^VHEN   TITLE  PASSES. 

Intention. 

No  general  rule  can  be  laid  down  that  will 
apply  to  every  case.  The  courts  have 
generally  held  that  it  depends  upon  the 
intention  of  the  parties,  and  should  be 
left  to  the  jury  to  determine. 

— Harkness  v.   Russell  &  Co 113 

Wagar  v.  Detroit,  L.  &  N.  R.  Co..  .    121 

Noah  v.  Pierce 123 

TiObdell   V.   Horton 124 

Ex  parte  Crawcour 125 

I'^'irst  Nat.  Bank  of  Cairo  v.  Crocker  127 
Macomber  v.  Parker 130 

Condition  Precedent. 

The  title  to  personal  property  does  not  pass 
to  a  purchaser  under  an  agreement  re- 
taining it  in  the  vendor  until  the  pur- 
chase price  is  paid,  until  such  payment 
of  the  purchase  price  is  made. 

—.Tenner  v.  Smith 133 

Gill  v.  De  Armant 136 

Hovey  v.   Gow 138 

Marvin  Safe  Co.  v.  Norton 140 


Pae» 

I.assing  v.  .Tames 143 

Wind  v.  Her 147 

Gibbs  V.    Benjamin 150 

Goods   Sold   on   Approval. 

Where  goods  are  sold  with  permission  to 
examine  them,  or  are  sold  on  trial,  the 
title  does  not  pass  until  one  of  three 
things  hajtpens:  T'irst,  when  the  buyer 
signifies  his  ajtitroval;  second,  when  the 
time  limited  for  the  trial  of  the  goods 
has  expired;  third,  if  there  is  no  limit  of 
the  time  for  trial  stipulated,  upon  the  ex- 
piration of  a  reasonable  time. 

— Pierce  v.   Cooley 152 

Wood  Reaping  &  Mowing  Mach.  Co. 

V.   Smith 153 

Piatt  V.  Broderick 156 

United     States     Electric    Pire-Alarm 
Co.  V.  City  of  Big  Rapids 157 

Sale  of  Chattels  not  Specific. 

—Commercial  Nat.  Bank  v.  Gillette...    160 

Ivimberly  v.   Patchin     161 

Sanger  v.   Waterbury 165 

Unascertained  Goods. 

It  is  a  general  rule  that  the  title  to  proper- 
ty which  is  the  subject  of  such  a  contract 
does  not  pass  until  the  goods  have  been 
ascertained  and   determined   upon. 
— Miiltby    V.    Plummer 166- 

Appropriation  by  Delivery  to  Carrier. 

It  is  a  well-settled  principle  of  law  that 
the  delivery  of  goods  to  a  common  car- 
rier for  one  who  has  purchased  and  who 
has  ordered  them  is  a  delivery  to  the  pur- 
chaser, though  it  does  not  amount  to  an 
acceptance  of  them. 

— Allard  v.  Greasert 171 

Ruhl  V.  Corner 173 

Goods  Sent  C.  O.  D. 

The  weight  of  authority  seems  to  be  that 
the  title  to  the  goods  does  not  pass  un- 
til delivery  to  the  buyer. 
— Lane  v.  Chadwick 176 

Other  cases  hold  that  title  passes  when  de- 
livered to  the  carrier  to  be  sent  C.  O.  D. 

— Higgins  V.  Murray 177 

Fleming  v.   Commonwealth 178 

The  Seller  must  Comply  xirith  the  Order 

or  Authority  Given  Him  by 

the  Buyer. 


-Aultman,  Miller  &  Co.  v.  Clifford. 


182 


Goods     must     be     Shipped    virithin     Time 
Specified. 


— Hoover  v.  Ma  her 
Crane  v.  Wilson 


184 
185 


Goods   must  be   Delivered    to    Particular 
Carrier  Specified. 


-Wheelhouse   v.    Parr, 


186 


Quantity  of  Goods  Delivered  must   Con- 
form  -with    the    Order. 

— Comstock   V.    Sanger 187 


Appropriation  by  the   Buyer. 

— Palmer    v.    Banfield 


190 


TABLE  or  C(JNTEXTS. 


Chattels  Made  to  Order. 

Where  chattels  are  manufactured  to  the 
order  of  the  buyer,  and  there  is  nothinj; 
further  to  l>e  done,  upon  acceptance  by 
the  purdiaser.  or  failure  within  a  rea- 
sonable tiuK'  to  give  notice  of  the  refusal, 
the  chattels  may  be  said  to  be  aitpmpriat- 
I'd,  and  the  title  to  have  passed. 

—Pratt   V.    Perk 


Page 


lit:? 


Dealings    xirith    Bills    of    Lading    to    Se- 
cure Price. 

— Dyer  v.   Great   Xorthi-ru  Ry.   Co 1!>~> 

Bill  of  lading  deliverable  to  order,  and  at- 
tached  to  time  draft. 
— National   Bank  of  Commerce  of   Bos- 
ton   V.     Merchants'     Xat.     Bank    of 
Memphis     19G 

WHiere  bill  of  lading  is  made  out  in  favor  of 
vendor,  and  draft  on  vendee  is  sent  with 
bill  of  lading  attached  to  the  bank,  title 
to  goods  does  not  pass  iiutil  the  draft  is 
paid. 
—Baker  v.    Chicago.    :M.    &   St.    V.    Kv. 

Co 201 

^^'here  goods  are  sold  for  cash,  and  shipped 
to  consignee,  and  draft  drawn  on  him  for 
the  purchase  i^rice.  and  forwarded  with 
the  Ijill  of  lading  attached,  title  will  uot 
vest  in  a  bona  fide  purchaser,  without 
payment  of  the  draft. 
— Freeman     v.     Kraemer 203 

When  a  banker  d'.scounts  a  draft  with  bill 
of  lading  as  collateral  security,  he  ac- 
quires a  special  property  in  the  goods  as 
against  all  until   the  draft   is  paid. 

—Fifth  Nat.  Bank  of  Chicago  v.   Bay- 


20.-: 


AVOIDANCE  OF  CONTRACT. 

For  Mistake. 

— See   Sherwood    v.    Walker    and    other 

eases     102-112 

For    Failure    of    Consideration. 

— Kimball    v.     Saguin 20(3 

For  Fraud. 

—Morse    v.    Shaw 208 

Litchfield    v.    Hutchinson 209 

For  False   Representation. 

— Galloway    v.    Merchants'    Bank 211 

Maxted     v.    Fowler 214 

\\'here  the  purchaser  expressly  relies  on  the 
knowledge  of  the  seller  as  to  quantity  or 
value,  the  seller  is  bound  to  act  honorably 
and  deal  fairl\  with  the  purchaser. 
When  confidence  is  reposed  n  him,  he  is 
bound   not  to   abus.>   it. 

— Picard   v.    McCormick 216 

Peck    V.     Jenison 218 

See.  also,  Welch  v.  Olmstead 27 

It  is  immaterial  whether  a  false  representa- 
tion  is   made  innox-ntly  or  fraudulently  if 
by  its  means  the  party  to  whom  it  is  made 
is  iniured. 
— Totten    V.    Burhans 220 

Misrepresentation  must  be  of  material 
facts,  not  of  mere  opinion. 

— See    Picard    v.    McCormick 21G 

Peck    V.    Jenison    218 

Welch  T.   Olmstead 27 

Where  goods  are  bought  on  credit  upon 
statements  of  the  buyer  that  he  will  pay. 
when  in  fact  he  knows  he  cannot  pay.  and 


intends  to  d<'fraud  the  seller,  the  viMKJor 
may   rescind    the  contract,    and    bring   re- 
plevin.                                                   , 
—Henry    v      Vliel    

Statements  must  have  been  relitnl  upon   by 
the  buyer. 
— Potter    V.    Lee 

Purchaser  may  rescind  the  sale  and  re<vjver 
the    money    paid,    or    retain    the    property 
and  sue   for   damages. 
—Wilson  V.  New   Pnited   States  Catth- 

Ua  nch    Co 

Lukens    v.    Aiken 


Paue 


223 


229 


When  seller  is  defrauded,  he  may   rescin<l. 
tender    Ijack    the    cousidt-ration.'   and    re- 
cover  the   goods,    or   affirm    and    recover 
damages. 
—Cortland   Manufg  Co.  v.  Piatt 2:i0 

Affirmance    or   resei.ssion    must    be    in    toto: 
it  cannot  lie  in  part. 
—Crane  Co.  v.  Columbus  Con.st.  Co....    2:i4 
The  mere  fact  that  the  vendee  is  insolvent 
at  the  time  of  the  punhase  d<jes  not  en- 
title the  vendor  to  rescind. 
—Illinois   Leather  Co.    v.    Flynn 240 

If  the  fraud  consists  in  false  impersonation, 
the    vendor   defraude.1    may    rescind,    and 
recover  back  the  goods  even  from  a   Ixma 
fide  purchaser. 
—Peters  Box  &  Lumber  Co.  v.   Lesh...   241 

Sales  made  wiih  the  intent  on  the  part  of 
the  seller  and  buyer  to  delay,  hinder,  or 
defraud  creditors  of  the  seller  are  fraud- 
ulent, and  may  be  avoided  by  the  cred- 
itors, unless  a  third  person  has  in  good 
faith  and  for  -^  valuable  considcrati<tn 
acquired  an  interest. 
— Bj  rncs    v     Volz 243 

Intent   to  defraud   must   be   mutual,    if   the 
sale  is   for  a   valuable  consideration. 
— Kindskopf    v.    Myers 245 

Where  the  salt  is  made  for  the  puriiose  of 
paying  an  honest  existing  debt,  it  is  law- 
ful, althoug..  it  may  deprive  all  others 
of  redress,  and  may  have  been  intended 
to  do  so. 
—Nichols    v.    Bancroft 24S 

When    conveyance   is   voluntary,    ami    with 
actual  intention    to  defraud  creditors,  the 
sale  may  be  avoided. 
-Wilson    V.    Siiear 251 

The  exempt  earnings  of  the  husband  can  In- 
transferred  to  the  wife  free  of  claims  of 
creditors.  So.  ihe  creilitor  caiinut  com- 
plain if  the  property  transferred  is  ex- 
empt property. 

— Brcsnahan    v.     Nugent 2.">3 

Nash    v.    Stevens 2.">7 


DELIVERY  AND  CONTINUED  POSSES- 
SION. 

As  against  bona  fide  purchasers  and  the 
creditors  of  the  vendor,  there  should  be 
delivery  of  the  goods  to  the  ven»lee.  and 
continued  pos.session  by  him.  This  is 
largely  regulated  )y  statutes  and  rulings 
of  the  courts  of  different  states. 

—Michigan   statute   (How.    St.    Mi<h.   § 
(3190). 
Kipp    V.    Lamoreaux 259 

Where  sale  of  chattels  is  not  accomiianied 
by  immediate  delivery,  and  followed  by 
actual  and  continued  change  of  pos.ses- 
sion, it  raise-;  the  presumption  that  the 
sale  is  fraudu'ent. 
— Mackellai    v.   Pillsbury 261 

Where  the  sale  is  attacked  as  fraudulent  as 
to  creditors,  the  burden  of  proof  is   upon 


TABLE  OF  CONTENTS. 


Page 
tho    attacking    party     to     establish     such 
fraud. 
—  HopkiiM^    V.    BishiPii '2C>?, 


CONVEYANCE  AND  ASSIGNMENT  FOR 
BENEFIT  OF  CREDITORS. 

AssignuH'uts  for  the  beuetit  of  creditors  are 
>rov('iued  generally  by  statute  in  the  dif- 
ferent staves. 

In  .Michigan,  and  generally  in  the  different 
states,  assignments  for  the  benefit  of 
creditors  must  be  general  and  without 
preference. 

As  to  whether  or  not  a  mortgage  on  all  the 
l)roperty  of  the  debtor  given  to  certain  of 
the  creditors  should  not  be  construed  as 
a  general  assignnicnt  for  all  creditors,  au- 
thorities differ. 

The  United  States  su])renie  court  holds  in 
the  athrmative.     See  cases   cited. 

— White    V.    Cotzhausen 2()r) 

Supreme  court  of  Micliigan  holds  in  the 
negative. 

—Warner    •. .    Littlefield 270 

Warren   v    Dwyer 278 

As    to    mortgage    to    secure    a    pre-existing 
debt. 
— Ai-nistrong   v.    Cook 279 

'Who  are  Creditors. 

General  creditors  who  have  not  obtained  a 
judgment,  or  who  have  no  lien,  cannot 
attack  a  conveyance  or  other  dealings  for 
fraud. 

— Nugent  V.   Nugent 280 

Trowbridge  v.   BuUard 282 

This  rule  does  not  apply  where  the  vendor 
and  vendee  of  personalty  enter  into  a  sale 
to  defeat  collection  of  taxes. 
—Gray   v.   Finn 28."j 

This  rule  does  not  apply  where  defendant 
conveyed  real  estate  to  his  bi'other  pend- 
ing suit  against  him. 
— Webber  v  Jackson 286 


ILLEGAL  SALES. 

If  the  thing  sold  is  in  itself  contrary  to 
good  morals,  the  sale  is  void:  as  obscene 
Ijooks  and  pictures. 

Where  the  thing  sold  is  in  itself  innocent, 
but  is  to  be  applied  to  an  unlawful  pur- 
pose, the  authorities  are  not  entirely  har- 
monious as  to  whether  or  not  the  sale  is 
valid. 
— Gambs  t.  Sutherland's  Estate 288 

Massachusetts  seems  to  hold  differently. 

— Graves    v.   Johnson 289 

Sales  Prohibited  by  Public  Policy. 

Public   policy   jirohibits: 
First.   Sales  of  offices. 

Second.   Sales  in  which  the  seller  is  unrea- 
sonably  restrained  from  carrving  on   his 
trade. 
Third.  Sales  of  lawsuits. 
As  to  the  second  sulxlivision,  see 

— Gibbs  V.  Consolidated  Gas  Co.  of  Bal- 
timore        291 

It  is  no  defense,  however,  to  an  action  for 
goods  sold  and  delivered,  that  jilaintiff  is 
a  member  of  an  illegal  trust  or  combina- 
tion to  interfere  with  the  freedom  of 
trade  and  commerce. 
— National  Distilling  Co.  v.  Cream  City 

Importing  Co. '.   297 


Contracts    of    Sale   "Which   Unreasonably 
Restrain  Trade. 

Page 
Every   agr(>ement  in   restraint   of  trade  of 
one  of  the  pai'ties  to  a  contract  is  void, 
as     being    against    public    policy,   unless 
founded    upon    a    valuable   consideration, 
and   limited    as  regards   time,    space,   and 
extent  of  the  trade  to  what  is  reasonable 
under  the  circumstances  of  the  case. 
—Richards  v.  American  Desk  &  Seat- 
ing Co 300 

Futures. 

Dealers  can  sell,  and  agree  to  deliver  in 
the  future,  goods  which  they  have  not  at 
the  time,  but  expect  to  buy.  Agreements, 
liowever,  for  sale  for  future  delivery,  are 
gambling  contracts,  and  not  enforceable 
when  the  intention  is  that  there  shall  be 
no  actual  sale,  but  only  that  at  the  time 
fixed  for  delivery  the  parties  shall  settle, 
and  the  purchaser  pay  or  receive  the  dif- 
ference between  the  agreed  price  and  the 
market  price  at  that  time. 

—Gregory  v.  Wendell 304 

Morrissey  v.  Broomal 307 

Where  the  parties  are  equally  in  fault,  and 
both  are  guilty  of  a  fraud,  the  law  will 
assist  neither,  but  leave  them  where  it 
finds  them:  and  so  a  "payment  of  mar- 
gins" cannot  he  recovered  back  in  case 
of  a  decrease  in  the  price  of  the  goods, 
where  both  vendor  and  purchaser  con- 
templated a  merely  gambling  contract. 

— White    V.    Barber 313 

Dows   V.   Glaspel 326 


W^ARRANTY. 

Of  Conformity  to  Description. 

Where  there  is  a  contract  for  the  sale  of 
goods  by  the  description,  there  is  an  im- 
plied condition  that  the  goods  shall  corre- 
spond with  the  description. 
— Morse  v.   Moore 332 

Of  Title. 

Vendor  warrants,  unless  it  is  clearly  shown 
that  he  did  not  intend  to  assert  owner- 
ship. l>ut  only  to  transfer  snch  interest  as 
he  miuht  have  in  the  property. 
— Croly  V.  Pollard 338 

Of   Fitness   for  PuTpo.?e. 

— Wisconsin  Red  Pressed-Brick  Co.   v. 

Hood    339 

Carleton  v.  Lombard,  Ayers  &  Co. .  .   341 

That   food   is   wholesome,   and   fit   for  con- 
sumption as  food. 
—Craft  V.  Parker,  Webb  &  Co 347 


Sale   by   Sample. 

That  goods  are  equal  to  the  sample. 

— Leitch     V.     Gillette-Herzog     Manuf'g 

Co 348 

Bradford   v.   Manly 350 


Express    Warranty. 

No  particular  form  of  words  is  necessary 
to  constitute  a  warranty.  Such  expres- 
sion should  be  used  as  will  show  the  in- 
tention of  the  party  to  bind  himself  to 
make  good  the  quality  nami-d. 

— Chapman  v.   Murch 3.")2 

Grieb  v.   Cok« 353 

Murphy  v.  McGra w 355 


TABLE  OF  C<JNTi:.\  rs. 


Caveat  Emptor. 

Page 
Unless  an  express  wiuranty  is  ^iven,  or  a 
warranty  is  implied  from  the  natnre  an<l 
circumstances  of  the  sale,  the  iloctriiie  of 
Ciivcat   eniptoi-  apjilii's. 

— Merguire    v.   O'Doniiell    S~>8 

Norton    v.    Nehi'aska    TiOan    »fc    Trnsl 
Co ;i59 


RIGHTS  OF  UNPAID  SELLER  AGAINST 
THE  GOODS. 


Vendor's  Liien. 

-Palmer  y.   Hand 


3ii2 


Stoppage  in  Transitu. 


Vendee  must  be  insolvent  before  the  right 
of  stoppage  in  transitu  can  be  exercised. 
-Benedict   v.    Schaettle ,3(>4 

Carrier  is  lialde  in  conversion  after  notice 
of  vendor's  intention  to  exercise  his  right 
of  stoppage  in  transitu. 
—Jones  V.    Earl 3»;8 

Goods  are  considered  in  transit  so  long  as 
they  are  in  posses^iion  of  the  carrier,  or 
so  long  as  the  buyer  has  not.  by  himself 
or  his  agent  or  bona  fide  assignee,  ob- 
tained possession  of  them. 
—Kingman    v.    Denison 3(!9 

Right  of  Resale. 

The  seller  should  generally  give  notice  of 
sale  to  the  buyer,  but  this  is  not  always 
necessary. 
— Holland  v.  Rea 371 

The  obligation  rests  upon  the  seller  to  dis- 
pose  of   the   goods   in    the   best    possible 
manner. 
— Wonderly  t.  Holmes  Lumber  Co 373 

Action  for  Damages  against  Buyer. 

In  The  case  of  an  executory  contract  for 
the  sale  of  goods  not  specific,  the  rule  is 
that  the  measure  of  damages  for  a  refus- 
al to  accept  the  goods  is  the  difference 
between  the  price  agreed  upon  and  the 
market  value  on  the  day  appointed  for 
delivery. 
— Unexcelled  Fire-Works  Co.  v.  Polites  377 
■\Vindmuller  v.   Pope 378 

Remedy  When  Title   has   Passed. 

The  seller  may  bring  his  action  for  the  pur- 
chase price  in  case  of  neglect  or  refusal 
to  pay. 

— Moody   v.   Brown 379 

Goddard  v.  Binncy 380 


REMEDIES    OF    THE    BUYER. 

When  the  seller  illegally  refuses  to  deliver 
the  property,  the  buyer  nia>-  bring  an  ac- 
tion against  him  for  his  nonconijiliance, 
and  the  measure  of  damages  is  the  esti- 
mated loss  directly  and  naturally  result- 
ing from  the  breach  of  the  contract. 
— Hewson-Herzog  Supply  Co.  v.  Min- 
nesota  Brick   Co 382 

Russell  V.  Horn,  Brannen  «.t  Forsyth 
Manufg   Co 38.5 


Special  damages  may  sometimes  be  collect- 
ed  growing  out  of  the  circumstances   of 
the  case. 
— Brownell  v.  Chapman 388 

When   by   sale    the    title   to    property    has 
passed,  and  the  seller  refuses  to  deliver, 
the  buyer  may  bring  an  action   for  con- 
version. 
— Philbrook   v.   Eaton 390 


Breach  of  Warranty. 

Page 
If  goods  are  sold  with  a  warranty,  and  do 
not  come  up  to  the  warranty,  the  buyer 
may  refuse  to  accept,  or  acct-pi   and  sue 
for  damages. 

—Gould  v.  Stein .392 

Fielder   v.   Starkin IVM 

In  case  of  a  breach  of  warranty,  the  buyer 
may   tender    back    the   i)roperty,    and    sue- 
to  recover  tiie  money  paid 
—See   Mnriihy   v.    McGraw .3."> 


STATUTE  OF  FRAUDS  AS  IT  RELATES 

TO  GOODS,  CHATTELS,  AND 

THINGS    IN    ACTION. 

In  the  follo'wing  cases,  every  agree- 
ment, contract,  and  promise  shall  be  void 
unless  such  agreement,  contract,  or 
promise,  or  some  note  or  memorandum 
thereof,  be  in  meriting,  and  signed  by  the 
parties  to  be  charged  therewith,  or  by 
some  person  by  him  thereunto  la\rfully 
authorized,    that    is    to    say: 

(1)  Every  agreement  that,  by  its  terms, 
is  not  to  be  performed  in  one  year  from 
the  making  thereof. 

(2)  Every  special  promise  to  answ^er 
for  the  debt,  default,  or  niisdoings  of  an- 
other person. 

(3)  Every  agreement,  promise,  or  un- 
dertaking made  upon  consideration  of 
marriage,  except  mutual  promises  to 
marry. 

(4)  Every  special  promise  made  by  an 
executor  or  administrator  to  ans-wrer 
damages  out  of  his  ourn  estate. 

(5)  Every  contract  for  the  sale  of 
goods,  Avares,  and  merchandise  for  the 
price  of  $50  or  more  shall  be  void  unless 
the  purchaser  shalx  accept  and  receive 
part  of  the  goods  sold,  giving  something 
in  earnest  to  bind  the  bargain  or  in  part 
payment,  or  unless  rome  note  or  mem- 
orandum of  the  bargain  be  made,  and 
signed  by  the  party  to  be  charged  there- 
by, or  by  some  person  thereunto  by  him 
lawrfully  authorized. 

Sufficiency  of  Contract  or  Memorandum. 

A  writing  n>lied  upon  to  take  the  promise 
out  of  tlie  statute  must  contain  all  tiie 
terms  of  the  contract.  Such  promise  can- 
not rest  i)artly  in  writing  ami  partly  in 
parol. 

— Baumann  v.  Manistee  Salt  &  Lumber 

Co 39.-, 

A  complete  and  binding  contract  may  be 
created  by  leiteis  and  other  writings  iv- 
lating  to  one  connected  transaction  if, 
without  the  aid  of  parol  testimony,  the 
parties,  subject-matter,  and  terms  of  tiie 
contract  may  be  collected. 
—Francis    v.    Barry ...    .■■>97 

Where  a  vendee  signs  an  order  for  gmids 
.solicited  by  the  vendor's  agent.  \\\u<  ;ilso 
acknowledgeil  in  writing  tint  the  goods 
had  been  ordered  f-rm  his  principal,  there 
is  a  sntticient  memorandum  of  the  sale  to 
satisfy  the  statute  of  frauds. 

— Austrian  &  Co.  v.  Springer 4iiO 

Agreements    not    to    be    Performed    in    a 
Year. 

—Warner  v.   Texas   vS:   V.   liy.   to 4<>4 


TABLE  OF  CONTENTS. 


Special  Promise  to  Ansxirer  for  tlie  Debt, 
Default,   or  Misdoings   of  Another. 

—Buck  V.  Haynes'  Estate 406 

See,  also,  Baumaim  v.  Manistee  Salt 

&  Lumber  Co 395 

Dupuis     V.    lutorio-    Construction     & 
Inipicivenunt    Co 408 

Original  Promise. 

— ^Mitchell  V.  Beck 410 

Stewart    v.    Jerome 412 

Michijran  Slate  Co.   v.    lion    Uan.w  & 

H.  B.  H.  Co 41.1 

Hobbs  V.  Brash  Electric  Lijiht  Co...  421 

/Agreements     for      the      Sale      of      Goods, 

■Wares,    and    Merchandise    for    the 

Price  of  Fifty  Dollars  or  More. 

— Harris    Photographic    Supply    Co.     v. 

Fisher     423 

Hatch    V.    AIcBrien 426 

Safford   v.    :McDonough 428 


Memorandum  in  Writing,  Signed  by  the 
Party  to  be  Charged. 

Pase 

— Butler    V.    Thomson 42J> 

Sanbor      v.    Flagler 431 

Labor  to  be   Performed  on   Goods. 

Statute  does  not  ajiplv. 

— Bagby  v.  Walker 433 

Delivery   and  Acceptance. 

— Coffin    V.    Bradbury 43<) 

Caulkins    v.    Hellnian 443 

Delivery  of  part  of  the  goods,  without  re- 
ceipt and  acceptance,  insutiicient. 
— Powder     Kiver     Live-Stock      Co.     v. 

Lamb     14.") 

Delivery  to  a  common  carrier,  in  the  usual 
course  of  transportation,  is  sufficient. 
— Leggett  iK:  Meyer  Tobacco  Co.  v.  Col- 
lier         450 

Allard    v.    Greasert 171 

Delivery  to  carrier  not  specially  designated 
not  sufficient. 
— Hudson  Furniture  Co.   v.   Freed  Fur- 
niture  &  Carpet   Co 452 


CASES  REPORTED. 


Page 
Adams  v.  Beall  (8  Atl.  004.  07  Md.  r.;i) ...  45 
Alexander  v.  Haskiu.s  (2."»  N.  W.  935,  08 

Iowa,  73)  GO 

Allard  v.  Greasert  (Gl  X.  Y.  1) 171 

Armstrong   v.    Cook    (54    N.    W.   873,   95 

Mich.   257) 279 

Artman   v.   Ferguson   (40  N.    W.   !K)7,  73 

Mich.  146)    78 

Aullman,  Miller  &  Co.  v.  Clifford  (50  N. 

W.  593,  55  Minn.  159) 182 

Austrian  &  Co.  v.  Springer  (54  X.  W.  50, 

04  ilich.  343) 400 

Bagby  v.  Walker  (27  Atl.  1033.  78  M<1. 

239)    4:i3 

Baker  v.  Chicago.  M.  &  St.  P.  Ry.  Co.  (67 

X.  W.  376)   201 

Bates  V.   Smith  (47  X.  W.  249.   83  Mich. 

347)    85 

Baumann    v.    Manistee    Salt   &    Lumber 

Co.  (53  X.  W   1113.  94  Mich.  3a3) 395 

Benedict  v.  Schaettle  (12  Ohio  St.  515) .  .  364 
Blackstone  v.  Standard  Life  &  Ace.  Ins. 

Co.   (42  X.  W.  156,   74  Mich.  592) 07 

Bloomingdale  v.    Chittenden    (42   X.    W. 

106,  74'  Mich.  698) 31 

Bradford  v.  Manly  (13  :Mass.  139) 350 

Bresnahan  y.  Xiigent  (52  X.  W.  735.  92 

Mich.  76) 2.53 

Brock\\a>    v.   .Jewell   (39  X.    E.   470,    52 

Ohio,   187)    57 

Brownell  v.  Chapman  (51  X.  W.  249,  84 

Iowa.  504)    388 

Buck  V.  Hayn^s'   Estate  (42  X.  W.  949, 

75  Mich.  397)    40G 

Buck  V.  Patterson  (42  N.  W.  949,  75  Mich. 

397)     400 

Butler  V.  Thomson  (92  U.  S.  412) 429 

Byrnes  v.  Volz  (54  X.  W.  942.  53  Minn. 

110)    243 

Carleton  v.  Lombard.  Ayers  iV-  Co.  (43  X. 

E.   422)    341 

Case  Threshing-Machine  Co.  v.  Mitchell 

(42  X.  W.  151,  74  Mich.  679) 


SO 

Caulkins  v.  Hellman  (47  X.  Y.  449) 443 

Chapman  v.  Murch  (19  John.^.  290) 352 

Coffin  V.  Bradbury  (35  Pac.  715) 43(i 

Commercial    Xat.    Bank    v.    Gillette    (90 

lud.  2(W)   160 

Comstock   Y.   Sanger  (16   X.   W.  872,  51 

-Mich.  497)    187 

Cortland  Manuf'g  Co.  v.  Piatt  (47  X.  W. 

3.30,  83  Mich.  419) 2;S0  |  Graves    v.    .Johnson    (;?0    X.    E.    818.    150 

Craft  V.  Parker,  Webb  &  Co.  (55  X.  W.  I     Mass.  211)    -89 

812.  96  Mich.  24.5)   347  j  Gray  v.  Finn  (55  X.  W.  (U5.  90  Mich.  t;2)  285 

Grano  v.  Wilson  (03  X.  W.  50(>) 185  I  Gregory  v.  Lee  (30  Atl.  53.  04  Conn.  4n7)     35 

VAN  ZILE  SEL.CAS.SAI.KS.  (Xl) 


Page 
Crane  Co.  v.  Columbus  Const.  Co.  (20  C. 

C.  A.  2Xi,  73  Fed.  984) Xi4 

Crawcour.  Ex  parte  (9  Cli.   Div.  419) 125 

Croly  V.  Pollard  (39  X.  W.  853,  71  Midi. 

012)    .'Ws 

Crosby  v.  Delaware  &  H.  Canal  Co.  {'Si  X. 

E.  730.  119  X.  Y  334) 25 

Crosby  v.  Delaware  &  H.  Canal  Co.  (3ti 

X.  E.  ;i32.  141  X.  Y.  589) 12 

Deyo  V.  Vauglin  (.)5  X.  W.  991.97  Midi.  1)  4 
Dickey  v.  Waldo  (50  X.  W.  008,  97  Mich. 

255)    87 

D(nvs  V.  Glaspel  (00  X.    W    00,  4  X.   D. 

251)     320 

Dube  V.  Beaudry  (23  X.  E.  222.  1.50  Mass. 

448i    48 

Dupuis  V.  Interior  Construction  «&  Im- 
provement Co.  (50  X.  W.  103,  88  Mich. 

103)    408 

Durfee  v.  Abbott  (28  X.  W.  521,  01  Mich. 

471)    41 

Dyer  v.  Great  Xorthern  Ky.  Co.  (5;j  X. 

W.  714,  51  Minn.  345) 195 

Englebert  v.  Troxell  (58  X.  W.  852,  4o 
Xeb.  195)    51 

Fielder  v.  Starkin  (1  H.  Bl.  17) 394 

Fifth  Xat.   Bnnk   of  Chicago  v.   Bayley 

(115   Mass.   228) 2()5 

First  Xat.  Bank  of  Cairo  v.  Crocker  (111 

Mass.  ir>3)   127 

Fleming  v.  Commonwealth  (IS  Atl.  022. 

130  Pa.  St.  138) 178 

Francis  v.  Barry  (37  X.  W.  :\r>:\.  09  Midi. 

311)    397 

Freeman  v.  Kraemer  (05  X.  W.  4.55) 20:? 

Galloway  v.  Merchants'  Bank  of  X«'ligh 
(60  X.  W.  5(>9.  42  Xeb.  259) 211 

Gambs  v.  Sutherland's  Estate  (59  X.  \V. 
(>52.    101    Mich     355) 2SS 

Gibl)s  V.  Benjamin  (45  Vt.  1*24) 15() 

Gibbs  V.  Consolidated  Gas  Co.  of  Balti- 
more (9  Sup.  Ct.  553.   130  U.   S.  :!90)..    291 

Gill  V.  De  Armant  (51  X.  W.  527,  JM)  Midi. 
425)    136 

Gillespie  v.  Beecher  (54  X.  W.  107.  94 
Mich.  374) 77 

Goddard  v.  Binney  (115  Mas.s.  450) 3S4) 

Gould  v.  Stein  (22  X.  E.  47,  149  Mass. 
570)    ;i!»^ 


CASES  KEPOKTED. 


Page 

Gregory  v.  Wendell  (39  Mich.  337) 304 

Grieb  v.  Cole  (27  N.  W.  57'J,  GO  Mich.  ;'.97)  3.j3 

Harkiiess  v.  Russell  &  Co.  (7  Sui).  Ct.  51, 

118  U.   S.   G(i3) 113 

Tlnrris  Photographic  Supply  Co.  v.  Fish- 
er (45  N.   W.  mi,  81  Mich.   130) 423 

Hatch  V.  McBrien  (47  N.  W.  214,  83  Mich. 

1.")!))    42<5 

Heath  v.  Steveus  (48  N.  H.  251) 43 

Heury  v.  Yliet  (54  N.  W.  122,  36  Neb.  138)  222 
Hewson-Herzoii  Supply  Co.  v.  Minnesota 

Brick  Co.  (.57  N.  W.  129,  55  Miuu.  530)  382 

Higgins  V.  Murray  (73  N.  Y.  2.52) 177 

Hobbs  V.  Brush  Electric  Light  Co.  (42  N. 

AY.   965,  75  Mich.  550) 421 

Holland  v.  Kea  (12  N.  W.  167.  48  Mich. 

218)    371 

Hoover  v.  Maher  (53  N.  AA'.  (i46.  51  Minn. 

269)   1^ 

Hopkins    v.   Bishop    (51    N.    W.    902,    91 

:\Iich.  328)    263 

Hovey  v.  Gow  (45  N.  W.  985,   81  Mich. 

314)    138 

Hudson  Furniture  Co.  v.  Freed  Furniture 

&  Carpet  Co.  (36  Pac.  132,  10  Utah,  31)  452 

LJull  V.  Hull  (48  Conn.  2.50) 94 

Huthmacher  v.  Harris'  Adm'rs  (38  Pa.  St. 

491)    104 

Illinois  Leather  Co.  v.  Flynn  (65  N.  W. 

519)    240 

Irons  V.  Kentner  (50  N.  W.  73,  51  Iowa, 

88)    15 

Jenner  v.  Smith  (L.  R.  4  C.  P.  270) 133 

J.    I.    Case    Threshing-Machine    Co.     v. 

Mitchell  (42  N.  W.  151,  74  Mich.  679) . .  SO 
Johnson  v.  Northwestern  Mut.  Life  Ins. 

Co.   (59  N.   W.   992,  56  Minn.   365) 28 

Jones  V.   Earl  (37  Cal.   630) 368 

Jones  V.  Kemp  (12  N.  W.  890,  49  Mich.  9)  2(3 

Kimball  v.  Saguin  (53  N.  W.  116,  86 
Iowa,  186)    206 

Kimberly  v.  Patch.n  (19  N.  Y.  330) 161 

Kingman  v.  Denisou  (48  N.  W.  26,  84 
Mi^ch.  608)    369 

Kipp  y.  Lamoreaux  (45  N.  ^Y.  1002,  81 
Mich.   299)    259 

Kountz  V.  Kirkpatrick  (72  Pa.  St.  376).  .     97 

Lamont  v.  La  Ferre  (55  N.  W.  687,  96 

Mich.  175)    10 

Lane  v.  Chadwick  (15  N.  E.  121.  146  Mass. 

68)    176 

Langdon   v.    Clayson    (42    N.    W.    805,    75 

Mich.   204)    37 

Lassing  v.  James  (40  Pac.   534,   107  Cal. 

348)    143 

Leggett  &  Meyer  Tobacco  Co.  v.  Collier  (56 

N.  W.  417.  89  Iowa,   144) 450 

Leitch  V.  Gillette-Heizog  Manuf'g  Co.  (67 

N.   W.   352) 348 

Litchfield  v.  Hutchinson  (117  Mass.  195) .  .  209 
Lobdell  V.  Hortou  (40  N.  W.  28,  71  Mich. 

6S1)    124 


Pa?e 

Low  V.  Pew  (108  Mass.  347) 8.3 

Lukens  v.  Aiken  (34  Atl.  .575,  174  Pa.  St. 
152)    229 

McConnell  v.  Hughes  (29  Wis.  537) 101 

Mclver   v.    Wihi  .ms    ,53    N.    W.    847.    83 

Wis.   570)    9 

Mackellar  v.  Booth  (51  N.  W.  222,  48  Minn. 

396)    261 

Mackellar  v.  Pillsbury  (51  N.  W.  222,  48 

Minn.  396)    261 

:\Iacomber  v.  Parker  (13  Pick.  175) 130 

Maltby  v.  Plummer  (40  N.  W.  3,  71  Mich. 

578)    166 

Marvin  Safe  Co.  v.  Norton  (7  Atl.  418,  48 

N.  J.  Law,  410) . 140 

Maxted  v.  Fowler  (53  N.  W.  921,  94  Mich. 

106)    214 

Merguire  v.  O'Donnell  (36  Pac.   1033,  103 

Cal.  50)   358 

Michigan  Slate  Co.  v.  Iron  Range  &  H.  B. 

R.  Co.  (59  N.  W.  64(5.  101  Mich.  14) 415 

Mitchell  V.  Beck  (50  N.  W.  305,  88  Mich. 

342)    410 

Moley  V.  Brine  (120  Mass.  324) 47 

Moody  V.  Brown  (34  Me.  107) 379 

Morrissey  v.   Broomal  (56  N.   W.  383,  37 

Neb.   766)    307 

Morse  v.  Moore  (22  Atl.  362,  83  Me.  473) .  .  332 

Morse  v.  Shaw  (124  Mass.  59) 208 

Murphy    v    McGraw    (41   N.    W.    917,    74 

Mich.  318) 355 

Nash  V.  Stevens  (65  N.  W.  825) 257 

National  Bank  of  Connuerce  of  Boston  v. 
Merchants'  Nat.  Bank  of  Memphis  (91 
U.  S.  92) 196 

National  Distilling  Co.  v.  Cream  City  Im- 
porting Co.  (56  N.  W.  864,  86  Wis.  352) .  .   297 

Nicliols  V.  Bancroft  (41  N.  W.  891.  74 
Mich.   191)    248 

Noah  V.  Pierce  (4S  N.  W.  277,  85  Mich. 
70)    123 

Norton  v.  Nebrasfci  Loan  &  Trust  Co.  (53 
N.  W.  481,  35  Neb.  466) 3-59 

Norton  v.  T:*ylor  (53  N.  W.  481,  35  Neb. 
-166)    359 

Nugent  v.  Nugent  (37  N.  W.  706,  70  Mich. 
52)    280 

Palmer  v.  Banfield  (.56  N.  W.  1090,  86  Wis. 

441)    190 

Palmer  v.  Hand  (13  Johns.  434) 362 

Peck  V.  Jenison  (.58  N.  W.  312.  99  Mich. 

326)    218 

Pembertou     Building    «&    Loan     Ass'u    y. 
■  Adams  (31  Atl.  280,  53  N,  J.  Eq.  25S) ...     32 
Peters  Box  &  Lumber  Co.  v.  Lesh  (20  N. 

E.  291,  119  Ind.  98) 241 

Philbrook  v.  Eaton  (134  Mass.  398) 390 

Picard  v.  McCormick  (11  Mich.  68) 216 

Piei-ce  V.  Cooley  (23  N.  W.  310,  56  Mich. 

552)    152 

PMtt  V.  Broderick  (38  N.  W.  579,  70  Ylich. 

577)    156 

Potter  V.   Lee  (53   N.   AA'.    1047,   94   Mich. 

140)    223 


CASES  REPOUTED. 
Page 


Powder  River  Live-Stock  Co.  v.  Lauib  (5G 

N.  W.  1019,  38  Neb.  330) 445 

Pratt  V.  Peck  (3G  \.  W.  410.  70  Wis.  020)..  193 

Rcnz.  In  re  (44  N.  W.  598.  79  Mich.  21G).  .  Go 
Richards  v.  American  Desk  &  Seating  Co. 

(5S  N.  VV.  787,  87  Wis.  503) 300 

Rindslvopf  v.  Myers  (57  N.  W.  9G7,  87  Wis. 

80)    245 

Robertson,  In  re  (9  Ch.  Div.  419) 125 

RodliCf  V.  Dallinger  (4  X.  E.  805,  141  Mass. 

1)    110 

Ruhl  V.  Corner  (63  Md.  179) 173 


xni 
Page 


Tyler  v.  Ualloi/s  Estate  (.35  N.  \S  .  '.hij.  tjs 
Mich.   185) 40 

Unexcelled  Fire  Works  Co.  v.  I'olites  (IS 
Atl.  105S,   130  Pa.  St.  .5.30) .377 

United  States  Electric  Fire-Aliinn  Co.  v. 
City  of  Big  Rapids  (43  N.  W.  lo:;n.  7S 
Mich.  (57)    157 

Wagar  v.  Detroit,  L.  &  N.  R.  Co.  (44  .\. 

W.  1113.  79  Mich.  G48» rJl 

Warmn-   v.    Littletield    (.50   N.    W.    721.    v.t 


Rupley  V.  Daggett  (74  111.  351) 

Russell     V.     Horn,     Branneu     &     Forsyth 
Manuf'g   Co.    (59    N.    W.    901,    41    Neb. 


112        Mich.   329)    27n 

Warner  v.  Texas  &  P.  Ry.  Co.  (4  C.  C.  A. 
()73,  54  Fed.  922) 4<i4 


5G7)    :«5    Warren  v.  Dwye-  (51  N.  W.  10<;2.  91  Midi. 

414)    27s 

Saftord  V.  McDonough  (120  Mass.  2tX)) 428  ;  Webber    v.    Jackson    (44    X.    W.    591.    79 


Sanborn  v.  Flagler  (9  Allen.  474) 431 

Sanborn  v.  Shipherd  (GO  X.  W.  1089.  59 

Minn.  144)    !X5 

Sanger  v.  Waterbury   (22  X.    E.  404,   IIG 

X.  Y.  371) 1(}5 


Mich.   175)    2.SG 

Welch  V.  Olmstoad  (51  X.  W.  .541.  '.mi  Mi.ji. 

492)    27 

Wheelhouso    v.    Parr    (G    X.    E.    787.    141 

Mass.  593)    1S(> 


Senter  v.  Mitchell  (16  Fed.  20G) 91    \\"hite  r.  Barber  (8  Sup.  Ct.  221,  123  I".  S. 


Sherwood   v.   Walker   (33   X.   W.   919,   GG 


392) 


313 


Mich.  5G8) .- 106    White  v.  Cotzhausen  (9  Sup.  Ct.  309.  12t) 


Stack  V.  Cavanaugh  (30  Atl.  3.50) 33 

Stannard  v.  Bums'  Adm'r  (22  Atl.  41J0,  63 

Yt.  244)  60 

Stewart  v.  Jerome  (38  X.  W.  895,  71  Mich. 

201)    412 

Stuiiii  V.  Boker  (14  Sup.  Ct.  99,  150  U.  S. 

312)    10 

Topliff  V.  McKendree  (50  X.   W.   109,  88 

Mich.   148)    .  .  .* 3 

Totten   V.    Burhans    (51    X.    W.    1119.    91 

Mich.  495)    220 

Trainer   v.   Trumbull    (6    X.    E.    7G1,    141 

Mass.  527)    49 

Trowbridge  v.  Bullard  (45  N.  W.  1012,  81 

Mich.  451)    282 

Tuttle  V.  Campbell  (42  N.  W.  384,  74  Mich. 

G52)    G 


U.   S.   329) 2a5 

Wilson  V.  Xew  United  States  Cattle-Ranch 

Co.  (20  C.  C.  A.  244,  73  Fed.  994. 225 

Wilson  V.  Spear  (34  Atl.  429) 251 

Wind  V.  Her  (Gl  X.  W.  1001) 147 

WindmuUei  v.  Pope  (14  N.  E.  4.3(j,  107  X. 

Y.   674)    37S 

Wisconsin  Red  Pressed-Brick  Co.  v.  Ho<xl 

(56  X.  W.  165,  54  Minn.  .543) 3:W 

Wonder ly  v.   Holmes  Lumber  Co.   (23   X. 

W.  79,  56  Mich.  412) :'.7;; 

Wood  V.   Boynton  (25  N.   W.  42.   G4  \\'is. 

20.5)    1<»2 

Wood  V.  Losey  (15  X.  W.  557.   .5<i  Mich. 

475)    •"'<> 

Wood   Reaping   &   Mowing   Mach.    Co.    v. 

Smith  (15  X.  W.  906,  50  Mich.  565) 153 


f 


ILLUSTRATIVE  CASES 


IN 


SALES. 


VAN  KILE  SEL. CAS. SALES.  (1)* 


CONTRACT  OF  SALE. 


TOPLIFF  et  al.   v.   MlKKXDKEE. 
(50  X.  \V.  109,  88  Mich.  148.) 

Supremt  Court  of  Michigan.      Oct.  30,  1891. 

Error  to  circuit  court,  Wayne  county; 
(Jeorge  S.  Hcsmer,  Judge. 

Action  liy  G.  Francis  Topliff  and  Charles  B. 
Brooks  against  Edward  J.  McKondree  for 
Itreach  of  contract  to  furnish  plaintiffs  100 
shares  of  Lalvo  Superior  Iron  Mining  stock  at 
i^-ll  per  share.  The  court  directed  a  verdict 
in  defendant's  favor,  and  plaintiffs  bring  er- 
ror.    Attirmed. 

Bowen,  Douglas  &  Whiting,  for  appellants. 
Conely,  Maybury  «S:  Lucking,  for  appellee. 

GRANT,  J.  I'laintiffs  and  defendant  were 
stock-brokers,  the  former  in  Boston,  the  lat- 
ter in  Detroit.  November  30,  1885,  defendant 
wrote  plaintiffs,  in  which,  among  other 
things,  he  said:  "Lake  Superior  Iron  Mining 
stock  can  be  bought  here  at  about  40  to  41 
per  share.  If  you  can  do  anything  at  these 
figiues,  1  can  furnish  some  of  the  stock,  say 
100  to  200  shares."  Some  correspondence  in 
regard  to  this  and  other  matters,  by  letters 
and  telegrams,  followed,  but  which  have  no 
bearing  upon  the  question  at  issue.  Decem- 
ber 3d,  defendant  wrote  plaintiffs,  stating:  "1 
can  furnish  you  100  shares  Lake  Superior  at 
.?41.00  per  share,  but  with  little  or  no  protit  to 
myself.  Still.  1  will  furnish  you  with  the 
stock  if  you  order  it.  Can  ship  it  to  you,  1 
guess,  Avith  draft  attached."  This  letter  was 
received  the  morning  of  December  5th,  and 
plaintiff's  immediately  replied  as  follows: 
"Your  favor  of  the  third  is  at  hand,  in  which 
you  offer  us  100  shares  Lake  Superior  Iron 
M.  Co.  at  41.  Our  customers  are  slow  in  buy- 
ing the  stock.  We  had  a  favorable  otter  for 
25  shares  to-day,  but  did  not  dare  to  sell,  as 
we  inferred  from  your  letter  that  you  did  not 
care  to  break  the  lot.  If  you  can  sell  us  any 
part  of  100  shrs..  say  25,  50.  or  75  shares,  at 
41,  please  wire  us  early  Monday  a.  m..  as  our 
buyer  may  withdraw  his  bid.  We  hope  to  dis- 
pose of  the  whole  lot  early  next  week.  State 
length  of  time  at  which  your  offer  of  stock  is 
good."  December  7th,  two  days  after  the  re- 
ceipt of  the  above  letter,  plaintiff's  telegi*aphed 
defendant  as  follows:  "We  take  100  Lake 
Superior,  41.  Forward  draft  attached."  On 
the  same  day  they  wrote  defendant,  saying: 
"We  wired  you  this  a.  m.  as  follows:  'We 
take  100  Lake  Superior,  41.  Forward  draft 
attached.'— which  we  now  confirm.  We  ex- 
pect the  stock  Wednesday  or  Thursday."   Ke- 

VAN  ZILE  SET,.CAS.SAT,ES 


ceiving  no  reply  from  defendant,  plaintiffs,  on 
December  9th,  telegraphed  defendant:  "No 
stock,  letter,  telegram  from  you.  What  does 
it  mean?  Explain  at  once  by  wire."  To  this 
telegram  defendant  replied  by  letter  Decem- 
ber 11th,  saying:  "Much  to  my  regret,  1  am 
unable  as  yet  to  furnish  that  100  shares  of 
I^ike  Superior  stock."  lie  akso  stated  his  rea- 
.sons  for  not  furnishing  it,  and  further  stated 
that  there  was  no  doubt  but  that  he  could  get 
it,  as  it  had  got  to  he  sold,  and  expressed  the 
hope  that  the  matter  would  not  put  them  to 
too  great  inconvenience. 

I  do  not  think  this  correspondence  made  a 
completed  contract.  The  defendant  did  not 
bind  himself  to  send  the  stock  to  Boston,  nor 
did  the  plaintiffs  bind  themselves  to  accept  it 
and  pay  for  it  in  Detroit.  No  binding  and 
completed  contract  could  have  been  made  oth- 
erwise than  by  the  acceptance  on  the  part  of 
the  defendant  of  the  terms  of  the  telegram  of 
December  7th.  McDonald  v.  Bewick,  51  Mich. 
79,  16  N.  W.  240;  Eggleston  v.  Wagner.  40 
Mich.  010,  10  N.  W.  37;  Bowen  v.  McCarthy 
85  Mich.  20,  48  N^  W.  155.  The  statement,  "I 
guess  I  can  ship  it  to  you  with  draft  attach- 
ed," c-aunot  be  construed  into  an  absolute  of- 
fer to  ship  it.  The  manner  and  place  of  de- 
Ijverj-  were  left  open  for  future  negotiation 
between  the  parties.  Plaintiffs"  letter  of  De- 
cember 5th,  and  their  own  evidence  upon  the 
trial,  show  that  they  must  have  so  under- 
stood it.  On  December  7th  they  had  negotiat- 
ed a  verbal  sale  of  the  stock,  but  refused  to 
complete  it  until  defendant  had  confirmed 
their  offer  by  telegram.  Getting  no  reply 
from  defendant  by  3  o'clock  p.  m.,  they  told 
their  customer  that  they  would  sell  him  the 
stock.  The  letter  of  defendant  of  December 
11th  was  not  an  acceptance  of  the  plaintiffs' 
offer  contained  in  their  telegram  of  Deceml)er 
7th.  That  letter  stated  that  he  was  unable 
to  furnish  the  stock.  The  defendant  did  not 
then  have  the  stock  under  his  contrel.  The 
owner  was  in  New  York,  and  the  stock  was  in 
a  Detroit  bank  as  security.  The  owner  refus- 
ed to  release  it  until  he  ^'eturued.  All  these 
facts  were  communicated  by  defendant  t<t 
plaintiffs  in  his  letter  of  December  11th.  The 
statement  that  there  was  no  doubt  about  get- 
ting the  stock  constituted  no  binding  agree- 
ment on  his  part  to  procure  it,  and  there  is 
nothing  else  in  the  letter  from  which  any 
contract  could  be  implied.  The  court  below 
properly  directed  a  verdict  for  defendant. 
Judgment  affirmed.  The  other  justices  coa- 
ciuTed. 


CONTilACT  OF  SALE. 


DEYO   T.   VAUGHN. 
(5,-1  N.  W.  991,  97  Mich.  1.) 
Supreme   Court    of    Michigan.    July    2G,    1893. 
Error    to    circuit    court,    Jaclison    county; 
Kollin  H.  I'orson,  Judge. 

Action  by  James  C.  Deyo  against  Sewell 
S.  Vaughn  for  breach  of  warranty  of  a 
horse.  Judgment  for  plaintiff.  Defendant 
brings  error.    Attirmed. 

Thomas  A.  Wilson,  for  appellant.  Thomas 
K.  Barkworth,  for  appellee, 

LONG,  J.  Plaintiff",  a  dealer  in  horses,  on 
April  14,  1891,  wired  defendant  from  New 
i'orlv,  asking  the  price  of  a  certain  horse 
called  •"Golden  Rod,"  then  owned  by  de- 
fendant, at  Jackson,  tliis  state.  To  this 
coinniunication  defendant  replied  by  wire  on 
the  IGth.  saying:  "$500  lowest  for  soft  bay 
horse  Golden  Rod."  Upon  receipt  of  this 
message,  and  on  the  same  day,  plaintiff" 
again  wired  defendant,  saying:  '"Take  him, 
blanket,  girth,  halter,  if  perfectly  sound." 
The  following  day,  April  17th,  defendant 
wrote  plaintiff,  saying,  in  substance:  "The 
horse  is  sound  and  right  without  fault.  If 
you  take  him,  it  must  be  closed  and  the 
horse  taken  away  without  delay."  April  19th 
the  plaintiff  wrote  Mr.  Hatch,  at  Jackson, 
requesting  him  to  go  to  defendant,  pay  him 
.1ir)(X»,  and  procure  the  horse  in  question,  and 
ship  him  to  New  York.  Two  days  after  the 
defendant  had  written  the  letter  to  plaintiff, 
the  horse,  in  being  exercised  by  defendant's 
employe,  strack  and  injured  his  left  fore  leg, 
which  slightly  lamed  him.  The  defendant 
treated  the  limb  by  bathing  it  with  liniment, 
which  resulted  in  removing  a  portion  of  the 
hair.  About  a  week  after  the  writing  of  the 
letter  by  defendant,  Mr.  Hatch  called  at  de- 
fendant's residence  for  the  horse.  At  this 
time  there  was  a  bunch  on  the  leg,  produced 
by  The  injury,  about  the  size  of  a  half  hick- 
ory nut.  The  defendant  called  ]\Ir.  Hatch's 
attention  to  the  injury,  and  explained  how 
and  when  it  happened,  and  told  Hatch  he 
could  do  as  he  ha4  a  mind  to  about  taking 
the  horse,  llie  next  day  Hatch  called  on 
defdidaut,  received  the  horse,  paid  the  con- 
sideration, and  shipped  it  to  plaintiff"  in 
New  York.  At  the  time  the  horse  left  de- 
fendant's stable  he  was  not  lame,  and  Avas 
sound  and  all  right,  except  the  bruise  spoken 
of.  The  horse  reached  New  Y'^ork  on  the 
3ith,  and  on  the  following  morning  plaintiff 
claims  to  have  discovered  that  this  leg  was 
badly  swelled,  and  the  horse  lame.  He  was 
Ivcpt  by  plaintiff  about  two  months,  and  then 
returned  to  defendant,  in  whose  possession 
lie  remained  over  Sunday,  and  on  Monday 
moi-ning  was  sent  back  to  plaintiff's  barn, 
after  which  time  defendant  did  not  see  him. 
.Tuly  loth  thereafter  this  suit  was  commen- 
ced, based  upon  a  warranty  of  soimdnes-;, 
and  alleging  a  breach  of  such  warranty. 

The  main  controversy  in  the  case  is,  was 
the  injury  to  the  hoi'se  one  with  which  de- 
fendant could  be  charged  under  his  contract 


of  warranty?  It  is  claimed  by  defendant 
that  the  injui-y  occurred  after  the  title  to 
the  property  had  passed  to  plaintiff,  and  that 
therefore,  he  is  not  liable  in  this  action: 
that  the  contract  was  completed  at  the  date 
of  the  posting  of  the  letter  to  Hatch.  On 
the  other  hand,  it  is  contended  by  the  plain- 
tiff that  that  contract  was  not  completed 
until  the  delivery  of  the  horse  to  Hatch. 
The  court  below  held  with  the  plaintiff  upon 
the  construction  of  the  contract.  The  court 
was  not  in  error  in  this  interpretation  of 
the  contract.  The  plaintiff's  proposition  was 
to  take  the  horse  at  the  price  named,  if  he 
was  perfectly  sound.  Defendant  accepted 
the  terms  of  the  proposition,  but  added:  "If 
you  take  him,  it  must  be  closed  and  the 
horse  taken  without  delay."  It  is  said  that 
there  is  no  substantial  variance  between  the 
terms  of  plaintiff's  offer  and  defendant's  ac- 
ceptance; but  there  is  a  material  difference. 
The  acceptance  left  the  question  0[>en  to  be 
determined  by  the  plaintiff  whether  he  would 
take  the  horse  at  once,  and  under  it  he  was 
bound  to  decide  whether  he  would  com])ly 
with  defendant's  demand.  The  proposition 
of  defendant  was  tantamount  to  saying:  "I 
will  take  the  $500  you  offer  on  condition 
only  that  you  take  the  horse  immediately. 
If  you  do  not  conclude  to  do  so,  I  do  not  ac- 
cept your  term.s."  It  is  not  time  that  under 
such  circumstances  the  minds  of  the  pai'ties 
had  met  so  that  the  contract  was  completed. 
Neither  can  it  be  said  that  the  posting  of 
the  letter  by  plaintiff  to  Hatch  completed 
it.  Until  the  plaintiff  had  in  turn  notitied 
the  defendant  that  he  would  take  the  horse 
as  defendant  proposed,  it  was  not  com- 
pleted; and  this  was  not  done  until  Hatch 
called  upon  the  defendant,  a  week  later.  In 
any  view  of  the  case,  the  contract  cannot 
be  said  to  have  been  completed  until  that 
time.  nie  defendant  himself  could  have 
withdrawn  the  off'er  up  to  that  time,  and  the 
plaintiff  could  have  refused  the  offer.  De- 
fendant so  construed  it  at  the  time  Hatch 
called  for  the  horse,  telling  Hatch  he  could 
do  as  he  had  a  mind  to  about  taking  him 
away.  It  is  evident  from  this  that  he  did 
not  then  regard  the  sale  as  a  completed  one. 
It  is  the  rule  that,  where  an  offer  is  by 
letter,  the  usual  mode  of  acceptance  is  by 
sending  a  letter  announcing  a  consent  to  ac- 
cept. There  are  other  modes  of  acceptance, 
which  are  equally  conclusive  upon  the 
parties,  but  in  the  present  case  no  letter  was 
written  to  defendant  accepting  his  proposi- 
tion. ^Ir.  Hatch,  the  agent  of  plaintiff,  was 
directed  to  go  to  defendant,  pay  the  money, 
and  take  the  hoi"se.  He  did  not  go  until  a 
week  after,  and  at  that  time  defendant 
might  have  said:  "Y'ou  have  come  too  late. 
My  proposition  was  an  immediate  delivery. 
The  plaintiff  cannot  have  the  horse.  He  has 
not  accepted  my  offer  to  take  it  without 
delay."  If  this  position  had  been  taken  by 
the  defendant,  and  he  had  refused  to  deliver 
the  horse,  no  one  would  have  claimed  that 
plaintiff    could    have    recovered    him    in    au 


CONTRACT  OF  SALE. 


action.  To  make  a  completed  contnict,  the 
minds  of  the  parties  must  meet;  and,  where 
a  proposition  is  in  writing,  the  acceptance 
must  be  absolute,  and  identical  with  the 
terms  of  the  proposal.  The  authorities  cited 
by  defendant's  counsel  do  not  meet  the  case 


presented  by  this  record.  This  disposes  oi 
the  main  question,  as  we  view  it,  in  the 
case.  There  are  other  questions  raised  by 
brief  of  counsel  for  appellant.  We  have  ex- 
amined them,  and  find  no  error.  Judj^ment 
affirmed.    The  other  justices  concurred. 


e 


CONTRACT  OF  SALE. 


riTTLE   V.    CAMPBELL   et   al.i 

(42  N.  W.  384,  74  Mich.  652.) 

.ujirome   Court  of   Michigan.    April   19,   1889. 

Error  to  circuit  court,  Ingham  county; 
Pkck,  Judge. 

Assumpsit  by  Flora  B.  Tuttle  against  .John 
F.  Campbell  and  Martin  Hanlon.  Judgment 
for  plaintiff,  and  defendants  appeal. 

Smith  d-  York,  for  appellants,  li.  A. 
Montgomerij,  for  respondent. 

CHAMPLIN,  J.  Some  time  in  1882  William 
A.  Tuttle,  who  is  the  plaiuliff's  husband,  en- 
gage<l  in  tiie  business  of  selling  drugs  and 
medicines  at  AV'illiamston,  Ingiiam  county. 
He  occupied  a  store  wliich  belonged  to  his 
wife,  Flora  B.  Tuttle.  In  M;ircli  of  1884 
domestic  dissensions  caused  a  sejianition  be- 
tween Tultle  and  his  wife,  and  she  left  him 
and  determined  upon  tiling  a  bill  of  com- 
plaint to  obtain  a  divorce  from  tlie  bonds  of 
matrimony.  To  save  litigation  over  the 
question  of  alimony,  he  agreed  to  give  her 
.^1,000,  in  full  of  all  claims  against  him,  to 
be  paid  when  she  obtained  a  decree  for  di- 
vorce, to  secure  which  he  gave  her  a  certifi- 
cate of  deposit  on  the  bank  of  Daniel  i>. 
Crossman,  payable  to  her  order  when  she 
should  ol)tain  a  decree  for  divorce  against  her 
husljand.  The  certificate  was  then  left  with 
Crossman  for  safe-keeping.  Tliis  arrange- 
ment was  so  entirely  satisfactory  that  the 
parties,  on  the  same  day  or  the  next,  laid 
aside  tiieir  differences  and  went  to  living  to- 
gether again.  The  bill  was  not  filed,  neitiier 
was  the  certificate  of  deposit  taken  up  or  can- 
celed with  her  consent.  Harmony,  however, 
did  not  long  prevail  in  the  Tuttle  family. 
Dissensions  broke  out  anew,  and  Mr.  Tutt  e, 
willioiit  iier  knowledge,  obtained  from  Mr. 
Crossman  i)ossession  of  the  certificate,  and  a 
short  time  tliereafter  she  found  it  in  his  cash- 
drawer  and  took  and  retained  possession  of 
it.  It  appears  that  the  date  of  the  certificate 
was  March  22,  1884,  and  when  it  was  ob- 
tained Mr.  Tuttle  deposited  -S^UO,  and  gave 
his  note  to  Crossman,  due  in  six  months,  for 
the  other  8500.  Tliis  note  was  not  taken  up 
when  he  became  pObse.->sed  of  the  cerlilicate 
after  the  reconciliation,  and  there  is  no  direct 
testimony  that  he  then  withdrew  the  $500 
cash  which  he  had  deposited,  although  there 
is  a  strong  inference  to  that  effect  from 
Crossmans  testimony.  At  any  rate,  in  Au- 
gust Mrs.  Tuttle  held  the  .S1,000  certificate, 
and  Crossman  held  Mr.  Tuttle's  note  for 
$500.  At  this  time  Mr.  Tuttle  told  her  that 
he  had  got  to  sell  in  order  to  pay  Crossman 
that  .81,000,  because  he  had  to  secure  hiin  at 
the  time  he  got  the  certificate,  and  that  she 
might  come  on  Crossman  if  he  did  not  settle, 
and  so  he  had  got  to  sell  out  to  pay  him. 
He  finally  told  Mrs.  Tuttle  that  if  she  would 
indorse  the  certificate  of  deposit  to  him  siie 

1  Dissenting    opinion     of    Sherwood,     C.    J., 

fiiiiittpd. 


could  have  a  thousand  dollars'  worth  of  in- 
terest in  the  stock  of  drugs  and  medicines, 
which  offer  she  accepted,  and  indorsed  the 
certificate,  and  Tuttle  delivered  it  up  to  Cross- 
man  on  the  I'Jth  day  of  August,  1884,  and 
Crossman  canceled  it  and  delivered  up  to 
Tuttle  his  note  of  $500.  There  was  some 
testimony  tending  to  prove  that  Tuttle  had 
occupied  the  store  of  Mrs.  Tuttle  over  two 
years  without  paying  any  rent  to  her,  and 
also  had  collected  the  rents  of  tenants  occu- 
pying other  portions  of  the  building,  for 
which  he  owed  her,  and  that  this  indebted- 
ness also  entered  into  the  consideration  for 
the  $1,000  worth  of  interest  in  the  stock  of 
goods.  After  this  transaction  Mr.  Tuttle 
continued  to  carry  on  the  business  until 
April  25,  1885,  when  he  sold  the  entire  stock 
of  goods  and  fixtures  to  defendants  for 
$2,750,  $500  of  wliich  was  paid  in  cash,  and 
the  balance  in  notes.  The  last  one  to  mature, 
being  for  $250,  was  made  conditional  upon 
defendants  being  able  to  obtain  a  lease  of 
the  store  from  Mrs.  Tuttle.  An  inventory 
madesoon  after  tliepurchase  at  the  cost  price 
showed  the  value  of  the  stock  to  have  been  a 
little  over  .$3,160.  The  bargain  was  closed 
on  Saturday  night,  and  the  next  day  Mr. 
Tuttle  left  the  place  and  remained  absent 
nearly  two  years  without  his  whereabouts 
being  known  to  Mrs.  Tuttle.  The  sale  was 
made  without  her  consent.  She  iiad  heard 
that  the  defendant  Campbell  was  endeavor- 
ing to  purchase,  and  he  had  inquired  of  her 
whether  she  would  rent  to  him  the  store  in 
case  he  should  purchase,  and  she  refused, 
and  also,  as  she  testifies,  expressly  notified 
him  in  that  interview  that  she  was  the  own- 
er of  a  thousand  dollars'  interest  in  the 
stock  of  goods.  This  interview  was  al>out 
four  months  before  the  purchase  by  defend- 
ants. The  defendant  Ilanlon  had  been  a 
school-teacher  in  the  village,  and  had  heard 
that  the  domestic  relations  of  Tuttle  and  his 
wife  were  not  entirely  harmonious,  lie  was 
invited  by  Dr.  Campbell  to  join  him  in  mak- 
ing the  purchase,  and  had  been  told  by  him 
that  Mrs.  Tuttle  refused  to  rent  the  store  to 
him,  but  it  was  not  shown  that  he  had  ex- 
pre.-^s  notice  of  Mrs.  Tuttle's  $1,000  interest 
in  the  stock  of  goods  when  he  purchased. 
A  bill  of  sale  was  executed  to  them  jointly 
by  Tuttle,  conveying  the  whole  stock  of 
goods  then  in  the  store.  They  tliereu]  on 
went  into  possession,  and  continued  the  snle 
of  drugs  at  retail,  Mr.  Hanlon  giving  his  at- 
tention to  the  selling  of  the  goods  in  the 
store.  About  30  days  alter  the  purchase 
Mrs.  Tuttle  went  into  the  store  and  found 
Mr.  Hanlon  there  in  possession,  and  stated 
to  him  that  she  had  a  thousand  dollars'  in- 
terest in  the  stock,  and  demanded  that  he  turn 
out  to  her  a  thousand  dollars'  worth  of  the 
goods  in  the  stock,  or  pay  her  .$1,000  for  such 
interest.  He  absolutely  refused  to  do  either, 
and  claimed  that  they  iiad  bought  the  whole 
stock  and  it  was  tiieirs.  No  demand  was 
made  upon  defendant  Campbell.  This  suit 
was  then  brought  by  plaintiff,  alleging  the 


CONTRACT  OF  SALE. 


conversion  of  lier  interest  in  tlie  poods,  bnt 
waiving  the  tort,  and  asking  a  judgment  fur 
their  value  in  a.ssninj).sit.  Tiie  trial  resulted 
in  a  verdict  and  judgment  for  the  i)l;iintilf  for 
tiie  full  amount  of  her  claim,  with  interest 
from  the  date  of  demand. 

Three  objections  were  taken  to  the  admis- 
sion of  testimony.  We  do  not  think  the  er- 
rors assigned  upon  them  call  for  a  reversal 
of  the  judgment  upon  any  of  the  grounds 
stated  against  the  admission  of  such  testi- 
mony. 

The  main  grounds  of  error  relied  on  may 
be  considered  under  the  following  heads: 

First.  Was  the  transaction  between  the 
plaintiff  and  her  husband  such  a  one  as 
created  them  owners  in  common  of  the  stock 
of  goods? 

iSecoiul.  If  they  were  such  owners  in  com- 
mon, would  a  purchaser  from  the  iiusl)and  of 
the  whole  stock,  without  notice  of  his  co- 
owner's  rights,  acquire  a  title  to  the  whole 
stock? 

Third.  If  not,  is  the  purchase  by  Dr.  Camp- 
bell, with  notice  of  plaintiffs  ownership  and 
the  refusal  to  recognize  tiie  rights  of  Mrs. 
Tuttle  by  the  defendant  Hanlon,  evidence  of 
a  conversion  of  the  goods  by  both  defendants, 
so  as  to  sustain  an  action  ai-'aiust  both  jointly  V 

Fourth.  Where  a  small  portion  only  of  the 
goods  are  sold,  the  balance  remaining  in  pos- 
session of  the  co-owners  in  common,  who 
deny  tiie  right  of  another  owner  in  common 
to  any  of  the  goods,  can  tlie  dispossessed 
owner  treat  it  as  a  conveision  of  the  whole, 
and,  waiving  the  tort,  maintain  an  action  of 
assumpsit  to  recover  the  value  of  the  goods 
converted  ? 

1.  The  owner  of  chattels  may  sell  an  un- 
divided siiare  or  interest  in  tliein,  and  the  re- 
lation thus  created  will  be  a  common  owner- 
ship, which,  by  analogy  to  such. relations  in 
real  property,  isfretjuently  designated  as  ten- 
ancy in  common  of  the  property.  In  such 
case  no  actual  delivery  is  required.  The  title 
passes  at  time  of  sale,  if  such  is  tiie  intent  of 
the  parties.  Jioth  or  eitiier  may  have  the 
actual  possession  of  property  owned  in  com- 
mon, and  when  one  owner  has  the  actual 
possession,  and  the  other  has  not,  the  owner 
in  possession  is  simply  the  bailee  of  his  co- 
owner'sshare.  AV'hen  an  undivided  share  or 
interest  in  personal  property  is  sold,  there  is 
no  more  objection  to  a  designation  of  the  in- 
terest sold  by  dollars'  worth  than  there  is  by 
designating  a  part,  as  one-half,  one-lilth,  or 
any  other  fraction  of  the  whole.  In  either 
case  the  part  sold  is  a  fraction  of  the  whole, 
and  extends  to  every  j)art  and  parcel  thereof. 
In  one  case  the  unit  is  the  property;  in  the 
other,  the  unit  is  the  value  of  the  property. 
But  the  value  represents  the  property,  so  that 
the  units  are  in  fact  the  same.  The  share 
conveyed  measured  by  dollars'  worth  will  de- 
pend, as  regards  quantity,  upon  the  total 
Value  or  worth  of  the  whole  property.  And, 
in  cases  where  the  property  is  severable  and 
capable  of  division  in  kind  without  sale,  such 
share  may  be  severed  or  separated  from  the 


rest  by  taking  so  many  dollars'  worth,  with- 
out regard  to  the  quantity  that  is  left, 
whether  it  be  much  or  little,  for  the  balance 
of  the  unit  will  be  left  after  taking  out  the 
dollars'  worth  severed.  Of  course,  a  division 
is  more  readily  made  when  the  unit  is  the 
thing  and  the  share  is  designated  by  a  frac- 
tion of  the  (juantity;  but  if  the  owners  can- 
not agree  upon  the  division,  then  the  remedy 
is  a  sale,  as  in  other  cases.  Dollars'  worth  is 
often  used  to  measure  and  designate  the  share 
or  ownership  in  property.  More  parliculai  ly 
is  this  the  case  in  partnership  transactions. 
No  difiiculty  has  been  experienced  in  divid- 
ing up  the  property  from  the  use  of  such 
standard  as  a  measurement  of  interest.  A 
sale  of  an  interest  in  personal  property  must 
be  supported  by  a  sutticient  consideration. 
In  this  case  there  was  evidence  of  a  j)resent 
consideration  passing  from  Mrs.  Tuttle  to 
her  husband,  which,  if  believed  by  the  jury, 
was  suthcient  to  su{»i)ort  tlie  contract.  We 
conclude  that  the  transaction  between  Mr. 
and  Mrs.  Tuttle  was  such  as  created  them 
owners  in  common  of  the  stock  of  goods. 

2.  This  being  so,  he  could  not  without  her 
consent  convey  away  her  title  to  the  goods  to 
the  defendant  purcliasers.  So  far  as  he  re- 
tailed goods  out  of  the  store  to  customers,  her 
consent  would  be  implied  by  the  course  of 
dealing  tacitly  i)ermitted  by  her,  without  ob- 
jection. But  a  sale  of  the  entire  stock,  being 
out  of  the  ordinary  course  of  business,  would 
require  her  consent,  in  order  to  bind  her  or 
carry  hei  interest  to  the  purchaser,  she  te.s- 
tified  that  he  had  exjiressly  agreed  that  lie 
would  not  sell  out  the  entire  stock  without 
her  knowledge  and  consent,  and  that  this  sale 
was  made  in  violation  of  tliat  agreement. 
Owners  in  common  of  property  have  a  rigiit 
to  dispose  of  their  own  undivided  share,  but 
such  owner  cannot  sell  the  whole  property, 
nor  any  portion  thereof  excej^t  his  own;  and 
if  he  undertakes  to  dispose  of  any  larger  in- 
terest his  co-owners  are  not  bound  tliereby. 
Russell  V.  Allen,  lo  X.  Y.  17;>  178,  per  I)i:an, 
J.;  White  V.  Brooks,  4o  N.  II.  402;  Welch 
V.  Sackett,  12  Wis.  248;  Frans  v.  Young,  24 
Iowa,  375.  The  principle  is  w  ell  settled  that 
a  seller  of  personal  pmperty  can  convey  no 
greater  title  than  he  has,  and  it  makes  no 
difference  that  the  purch.iser  has  no  notice 
and  is  ignorant  of  the  existence  of  other  par- 
ties in  interest.  Couse  v.  Tre;;ent,  11  Mich. 
65;  Dunlap  v.  Gleason.  16  Mich.  158;  Trudo 
V.  Anderson,  lU  Mich.oo7;  Parish  v.  Morey, 
40  Midi.  417;  I'ease  v.  Smith,  61  N.  Y.  477: 
Beaice  v.  Bovvker.  115  Mass.  129.  Excep- 
tions are  found  where,  through  the  conduct 
of  the  party  or  by  his  laches,  he  is  estopped 
from  asserting  title  as  against  the  innocent 
purchaser;  but  this  casedoes  not  come  within 
the  exception.  The  fact  that  llaiilon  had  no 
notice  of  plaintilf's  interest  in  the  goods  be- 
fore he  purchased  from  Mr.  Tuttle  is  of  no 
importance,  and  the  rule  laid  down  by  the 
court,  requiring  that  they  should  tindas  mat- 
ter of  fact  that  he  had  notice  of  her  interest 
in  order  to  entitle  her  to  recover,  was  more 


CONTRACT  OF  SALE. 


favorable  to  defendants  than  tliey  were  en- 
titled to,  and  the  question  raised  l)y  defend- 
ants' counsel,  that  there  was  no  testimony  to 
supjiort  such  finding,  is  of  no  conseciuence. 
By  their  purchase  tlie  defendants  acquired 
title  to  tliat  portion  of  the  stock  which  their 
vendor  had  not  sold  to  Mrs.  Tattle,  and  to 
that  only,  and  they  stood  in  the  same  relation 
to  Mrs.  Tuttle,  respecting  the  ownership  of 
the  goods,  as  their  vendor  stood  before  their 
j)urcliase,  and  were  owners  in  common  with 
lier  of  the  entire  stock. 

3.  Ordinarily,  when  an  owner  in  common 
sells  the  goods,  the  other  owner  in  common 
may  treat  this  act  as  a  conversion,  and  bring 
an  action  of  trover  against  his  co-owner,  to  re- 
cover the  value  of  his  share;  but  he  is  not 
oldiged  to  do  tl)is.  He  may  retain  liis  title 
in  the  goods  in  the  hands  of  the  purciiaser, 
and  if  he  converts  them  he  is  likewise  liable 
therefor  to  his  co-owner.  What  constitutes 
a  conversion,  short  of  a  sale,  is  not  delinitely 
settled.  A  total  destruction  of  tiie  chattel,  or 
a  conversion  of  the  whole  to  his  own  use,  or 
something  equivalent,  such  as  a  total  denial 
of  liis  co-owner's  interest  in  tlie  property, 
coupled  with  a  total  exclusion  from  posse.s- 
sion,  will  render  the  owner  in  possession  lia- 
ble to  his  co-owner.  Owing  to  the  right 
which  an  owner  in  common  has  to  the  pos- 
session of  property  so  owned,  if  the  property 
is  in  its  nature  indivisible,  mere  refusal  to 
yield  possession  of  the  property  or  admit  to  a 
joint  possession,  without  denying  the  inter- 
est or  ownership  of  his  co-owner,  will  not 
constitute  a  conversion.  I  have  no  doubt 
that  the  claim  set  up  of  such  exclusive  own- 
ership by  Han  Ion  vvhen  demand  was  made 
upon  him  and  his  denial  of,  and  his  refusal  to 
recognize,  the  rights  of  plaintiff,  constituted  a 
conversion  of  the  plaintiff's  interest  in  the 
property,  so  far  as  he  was  concerned.  No  de- 
mand was  made  of  defendant  Campbell,  and 
none  was  necessary,  if  tlie  testimony  of  Mrs. 
Tuttle  is  to  ba  believed,  and  under  the  in- 
structions of  the  court  the  jury  have  given 
credence  to  it.  The  law  is  laid  down  in 
("ooley.  Torts,  at  page  528,  (*451,)  that:  "One 
who  buys  property  must,  at  his  peril,  ascer- 
tain the  ownership;  and,  if  he  buys  of  one 
having  no  authority  to  sell,  his  taking  pos- 
session in  denial  of  the  owner's  right  is  a 
conversion."'  Dr.  Campbell  purchased  know- 
ing Mrs.  Tattle's  right  to  the  property,  and 
in  contravention  of  it  purchased  from  Tuttle 
the  whole  property,  without  recognizing,  but 
ignoring,  her  rights  or  title  to  any  of  it  and 
took  [lossession  thereof  under  his  "bill  of  sale 
conveying  the  whole  property  with  warranty. 
This  was  a  conversion  of  her  share  in  the 
property  by  him,  and  a  demand  before  bring- 


ing suit  w'as  unnecessary.  The  third  ques- 
tion must  be  answered  in  the  aflirmative. 

4.  The  general  rule  is  that  before  a  party 
can  waivea  tort  for  the  conversion  of  personal 
property  and  bring  n.ssumpsit  the  property  in 
the  liands  of  the  tort-feasor  must  have  been 
sold  and  converted  into  money,  upon  the  the- 
ory that  the  money  has  been  received  for  the 
plaintiff's  use.  There  is,  however,  another 
class  of  cases,  where  the  property  has  been 
converted  l)ut  not  sold,  where  the  tort  may  be 
waived  and  assumpsit  brought  for  the  value 
of  the  goods  converted.  This  class  belongs 
to  those  relations  where  a  contract  may  exist 
and  at  the  same  time  a  duty  is  superimposed 
or  arises  out  of  the  circumstances  surround- 
ing or  attending  the  transaction,  the  viola- 
tion of  which  duty  would  constitute  a  tort. 
In  such  cases  the  tort  may  be  waived  and  as- 
sumpsit be  maintained,  for  the  reason  that 
the  relation  of  the  parties  out  of  which  the 
duty  violated  grew,  had  its  inception  in  con- 
tract. These  relations  are  usually  those  of 
trust  and  confidence,  such  as  those  of  agent 
and  principal,  attorney  and  client,  or  bailee 
and  bailor.  When  an  owner  in  common  of 
personalty  has  the  exclusive  possession  of  the 
property  he  is  a  bailee  of  his  co-owner's  share. 
In  such  case  there  is  a  contract  of  bailment 
implied  between  the  parties,  the  law  implying 
a  delivery  from  the  nature  of  the  case  and  the 
peculiar  rights  which  one  owner  in  common 
lias  to  such  property  when  reduced  to  his  pos- 
session. He  takes  it  and  holds  it  upon  the 
trust  and  confidence  that  he  will  care  for  it  and 
use  it,  if  he  us;>s  it,  in  an  ordinarily  careful 
manner,  and  will  not  sell  or  convert  his  co- 
owner's  share  to  his  own  use.  If  he  violates 
this  trust  and  confidence  by  converting  the 
property  to  his  own  use,  liis  co-owner  may 
bring  trover  for  the  conversion,  or,  waiving 
the  tort,  may  sue  in  assumpsit  to  recover  its 
value.  This  has  been  the  settled  law  in  this 
state  for  many  years,  and  was  explicitly  de- 
clared in  Fiqnet  v.  Allison,  12  Mich.  328, 
which  case  is  decisive  of  this.  See,  also,  Coe 
V.  Wager,  42  Mich.  49,  3  X.  AV.  Rep.  248; 
McLaughlin  v.  Sallev,  46  Mich.  219,  9  X.  W. 
Rep.  25t);  Evans  v.  Miller,  58  Miss.  120.  The 
facts  of  this  case  do  not  bring  it  within  the 
principle  above  stated,  and  the  action  of  as- 
siunpsit  cannot  be  maintained. 

The  judgment  must  be  reversed  and  a  new 
trial  granted. 

MORSE  and  LOXG,  JJ.,  concur. 
CAMPBELL,  J.,  concurs  in  tiie  result. 
SHERWOOD,  C.  J.,  dissents. 


TIME  OF  PAYMENT. 


McIVER  V.  WILLIAMS. 

(53  N.  W.  847,  83  Wis.  570.) 
Supreme  Court  of  Wisounsin.     Deo.  G,  1S92. 

Appeal  from  circuit  court,  .Milwaukee  coun- 
ty;   D.  H.  Jobu.son,  .Tudjie. 

Action  originally  brouplit  l)y  Anton  Tliiele 
iigainst  William  M.  Williams  for  the  [)osses- 
.«!iou  of  personal  property.  On  the  deatli  of 
Thiele,  .Tames  Mclver,  as  his  administrator, 
was  substituted  as  plaintiff.  From  a  juil^- 
ment  entered  on  the  verdict  of  a  jury  directed 
by  the  court  in  favor  of  plaintiff,  defendant 
^appeals.     Reversed. 

The  other  facts  fully  appi'ar  in  tlie  following 
statement  by  WINSLOW,  J.: 

Replevin  for  a  span  of  horses,  harnesses,  and 
a  wagon.  The  property'  was  originally  owned 
by  appellant,  Williams.  One  Thiele,  plain- 
tiff's intestate,  in  his  lifetime,  negotiated  with 
Williams  for  the  purchase  of  the  property,  and 
obtained  possession  of  the  same  by  virtue  of 
such  negotiations.  It  was  claimed  by  plaintiff 
on  the  trial  that  Thiele  in  fact  purchased  the 
outfit  for  the  agreed  price  of  $400,  and  that  he 
was  to  have  a  few  days'  time  to  pay  the  pur- 
chase price.  On  the  other  hand,  it  was  claim- 
ed by  Williams  that  the  price  was  agreed  on 
in  case  of  purchase,  but  that  possession  of  the 
pro])ertj-  was  given  by  Williams  to  Thiele  for 
the  purpose  of  trial  only  for  two  days,  which 
time  Williams  subsequently  extended  foi-  au- 
otiicr  day.  Thiele  in  fact  kept  the  horses  five 
days,  paid  no  part  of  the  purchase  price,  and 
^^'illiams  on  the  fifth  day  retook  the  property 
from  the  possession  of  Thiele's  son,  who  was 
driving  the  team.  Thiele  brought  replevin, 
and,  upon  his  death  before  trial.  Melver,  his 
administrator,  w^as  substituted  as  the  party 
plaintiff.  The  court  directed  a  verdict  lor 
plaintiff,  upon  which  judgment  followed,  and 
^lefendant  appealed. 


J.  M.  Clarke,  for  apix-llant.  J.  A.  Eggeu,  for 
respondent. 

WIXSLOW,  .T.,  (after  sfating  the  facts.)  In 
order  to  justify  tlie  direction  of  a  verdict  for 
plaintiff,  tlie  court  must  have  concluded  that 
the  uncontradicted  evidence  showed  that  there 
had  been  a  sale  of  the  horses  and  wagon  u|)on 
credit,  which  had  biH-ome  ab.solute  at  the  time 
of  the  recaption  of  the  i)ropi'rtj-  by  defend.mt. 
In  this,  we  think,  he  was  mistaken.  The  de- 
fendant gave  his  version  of  the  transaction  at 
length,  and  we  think  that  a  jury  would  iMi  en- 
tirely justilied  in  (inding  then'from  that  no 
sale  upon  credit  was  in  fact  made,  but  that 
defendant  simiily  allowed  the  intestate  to  take 
the  horses  a  few  days  to  try  them,  and  agre<'d 
that,  in  case  they  were  satisfactory  after  suc-h 
trial,  Thiele  might  purchase  tlie  entire  proper- 
ty for  .$400  in  cash.  If  this  was  in  fact  the 
agreement,  the  defendant  was  entitled  to  re- 
take the  property,  as  he  did.  becau.se  payment 
would  be  a  conditi(vi  precedent,  or  at  least  c'»a- 
current.  and  the  right  of  property  would  not 
pass  until  payment  was  made  or  waived,  even 
though  a  delivery  of  the  property,  upon  trial 
only,  had  been  made.  The  defendant  was  enti- 
tled to  have  this  question  submitted  to  the  jury. 
It  appears  that  Thiele  was  garnished  by  seviT- 
al  peivsons,  as  a  debtor  of  Williams,  on  the  day 
before  Williams  took  possession  of  the  horses, 
but  that  Williams  was  not  sensed  with  process 
until  several  days  afterwards.  There  is  noth- 
ing in  the  record  to  show  whether  the  gar- 
nishee actions  referred  in  imy  way  to  an  in- 
debtedness supposed  to  arise  from  a  purchase 
of  the  hoi'ses.  or  in  fact  whether  the  actions 
ever  went  to  judgment.  We  cannot  consider 
what  the  effect  might  be  if  in  fact  they  did  :io 
to  judgment  against  Thiele. 

Judgment  reversed,  and  cause  remanded  for 
a  new  trial. 


10 


TLM1-:  or   PAYMENT. 


LAMONT  V.  LA  FEXKE  ft  al. 

(55  N.  W.  ()87.  9()  Mich.  175.) 

Supreme   Court   of   Michigan.    June    23,    1893. 

Appeal  from  circuit  court.  Bay  county,  in 
chancery;  Georse  P.  Cobb,  Judge. 

Bill  by  Matthew  Laniont  against  Frank 
La  Fevre  and  wife  and  Michael  Daily  to  en- 
force a  mechanic's  lien.  Decree  for  com- 
plainant.   Defendants  appeal.    Affirmed. 

McDonell  &  Hall,  for  appellants.  Hatch 
k  Coolcy,  for  app(>llee. 

HOOKER,  C.  J.  Complainant,  a  material 
man,  filed  the  bill  in  this  cause  against  Frank 
La  Fevre  and  Almina  La  Fevre.  husband 
and  Avife,  and  Michael  Daily,  to  enforce  a 
mechanic's  lien  for  material  furnished  for  an 
hotel  erected  upon  premises  owned  by  Frank 
La  Fevre.  A  contract  to  furnish  material, 
erect  and  complete  said  hotel,  was  let  by 
La  Fevre  to  a  firm  of  bvnlders  named  Willis 
&  Grant,  who  in  turn  sublet  a  portion  to  one 
Thompson.  Thompson  failed  to  perform, 
and  negotiations  were  had  whereby  com- 
plainant furnished  material  which  Thompson 
should  have  furnished.  The  principal  dis- 
piite,  so  far  as  the  facts  are  concerned,  is 
over  the  question  of  defendant  Frank  La 
Fevre's  liability  to  complainant  for  this  ma- 
terial, the  complainant  asserting  that  it  was 
furnished  upon  the  request  of  La  Fevre,  ac- 
companied by  a  promise  to  pay  for  the  same 
the  amount  of  complainant's  bid.  The  de- 
fendants deny  that  La  Fevre  promised  to 
pay  for  the  material,  and  allege  further  that, 
if  he  did,  the  promise,  being  oral,  would 
come  within  the  statute  of  frauds  as  a  prom- 
ise to  pay  the  debt  of  Willis  &  Grant,  who 
were  under  contract  obligations  with  Frank 
La  Fevre  to  furnish  the  material.  Upon  the 
question  of  fact  it  is  sufficient  to  say  that  we 
agree  with  the  circuit  judge  that  the  com- 
plainant established  the  contract  alleged,  and 
that  it  was  an  original  promise,  and  valid. 
It  was  not  within  the  statute,  for  complain- 
ant did  not  sell  to  Willis  &  Grant,  nor  did 
they  purchase  the  material  from  him. 

A  number  of  legal  questions  arise.  It  is 
contended  that  there  was  no  meeting  of 
minds,  because  no  time  appears  to  have  been 
specified  when  the  amount  agreed  upon  for 
the  material  should  be  paid,  but  the  rule  of 
construction  in  such  cases  is  that  payment 
upon  delivery  is  contemplated.  The  state- 
ment filed  with  the  register  of  deeds  was  to 
the  elfect  that  the  materials  were  furnished 
"in  pursuance  of  a  certain  contract  with 
Frank  La  Fevre."  and  that  there  was  $*2'20 
due,  and  a  copy  of  this  statemtnt,  with  notice 
of  filing,  was  served  on  Frank  La  Fevre 
only.  The  bill  alleges  two  contracts,— one 
made  on  or  about  July  20,  ISUO,  for  .$400; 
and  another,  "that  complainant  should  fur- 
nish for  the  building  such  materials  as  La 
Fevre  might  order  from  time  to  time,  for 
which  he  (La  Fevre)  would  pay,  under  which 
arrangement   couiplainant   furnished   materi- 


als to  the  amount  of  $20."  This  sum  of  $20 
was  rejected  by  the  circuit  judge,  and,  as 
complainant  did  not  appeal,  cannot  be  al- 
lowed here.  It  is  mentioned  because  the 
defendants  assert  that  it  is  t'le  o  •  -asion  of  a 
variance  between  the  statement,  which  men- 
tions one  contract,  and  the  bill  and  proofs, 
which  mention  two;  and  it  is  contended 
further  that  the  statement  is  excessive  by 
this  amount,  and  that  the  lien  is  therefore 
lost.  It  appears  that  the  only  reason  for 
denying  complainant  any  portion  of  his  claim 
was  the  fact  that  in  his  statement  of  lien  he 
did  not  say  two  certain  contracts  instead  of 
one.  By  a  mere  technicality  he  is  deprived 
of  his  security  for  $20,  although  an  honest 
claim.  The  case  differs  from  those  cited  by 
counsel  for  defendants  where  persons  wrong- 
fully clouding  debtors'  titles  with  excessive 
liens  are  denied  the  benefit  of  the  statute. 
The  case  of  Gibbs  v.  Hanchette,  (Mich.)  51 
N.  W.  Rep.  691,  carefully  distinguishes  be- 
tween such  cases  and  those  where,  throU'.,'h  an 
honest  mistake,  too  much  has  been  claimed 
in  the  statement  of  lien,  or  by  reason  of  a 
failure  of  proof  the  claimant  was  denied  the 
entire  amount  claimed.  We  think  this  case 
is  of  the  latter  description.  Under  his  plead- 
ing the  court  below  declined  to  consider  the 
$20  item,  and  for  reasons  given  we  cannot 
allow  him  the  amount  here,  if  we  shoulti  find 
the  statement  filed  would  permit  it,  about 
which  we  find  it  unnecessary  to  express  an 
opinion. 

A  point  is  made  over  the  matter  of  notice, 
defendant  Almina  La  Fevre  not  having  been 
served  with  notice.  The  object  of  si  notice 
is  to  prevent  the  owner  from  paying  the 
principal  contractor,  (Laws  1885,  p.  297,  §  5,) 
and  in  this  case,  as  the  contract  was  made 
with  the  owner,  there  was  no  necessity  for 
a  notice.  Tlie  validity  of  a  lien  does  not  de- 
pend upon  the  notice.  Kirkwood  v.  Hoxie, 
(Mich.)  54  N.  W.  Rep.  721.  The  building  for 
which  this  material  was  furnished  was  an 
hotel,  with  a  wing;  the  latter,  used  for  a 
barber  shop,  being  entirely  on  the  west  half 
of  lot  11,  while  the  former  was  on  the  west 
half  of  lot  12,  of  block  19,  in  Bay  City.  The 
proof  shows  that  the  timber  was  used  in 
both,  which  were  being  erected  together,  and 
it  is  not  an  unreasonable  assumption  that 
both  were  contemplated  when  the  contract 
was  made.  We  think  they  should  be  treated 
as  one  parcel,  as  defendant  evidently  treated 
them,  and  that  the  lien  attached  to  both. 

The  remaining  qiiestion  pertains  to  the 
homestead  rights  of  Mrs.  La  Fevre.  The 
defendants  piu-chased  the  premises  for  a 
homestead  before  contracting,  and  moved  up- 
on them  before  the  statement  of  lien  was 
filed,  with  the  design  of  making  it  their 
home.  They  thereby  made  it  a  homestead, 
and  the  fact  that  the  building  erected  and  in 
which  they  reside  is  an  hotel  made  no  dif- 
ference. Mills  V.  Hobbs,  76  Mich.  122;^ 
King  V.   Welborn,    83  Mich.   199,   47  N.   W- 


1  42  N.  AV.   1084. 


TIME  OF  PAYMENT. 


11 


Rt'p.  lOG.  To  the  n mount  of  $1,500  it  was 
exempt  from  this  lien.  Beyond  that  sum 
the  hen  attaches,  and,  as  the  premises  can- 
not be  divided,  a  sale  attords  the  only  means 
of  reaching  the  excess.  To  hold  thatit  could 
not  be  reached  because  indivisible  woidd  be 
to   do    violence    to    the   plain    intent    of    the 


statute,  wliieh,  wliile  it  aims  to  afford  every 
one  a  shelter,  was  not  designed  to  enable 
him  to  defeat  creditors  by  so  con-structing 
valuable  property  as  to  make  it  difficult  to 
divide  it.  Tlie  decree  of  the  circuit  court 
will  be  affirmed,  with  costs.  The  other  jus- 
tices concurred. 


12 


SALJJ  DISTINGUISHED  FROM   BAILMENT. 


CROSBY   et    al.    v.    DELAWARE    &    H. 
CANAL  CO. 

(36  N.  E.  332,  141  N.  Y.  589.) 

Court  of  Appeals  of  New  York.      Feb.  27,  1894. 

Appeal  from  supreme  court,  gouornl  term, 
third  department. 

Action  bj'  Abel  A.  Crosby  and  others 
a.uainst  the  president,  etc.,  of  the  Delaware 
iVc  Hudson  Canal  Company  for  conversion  of 
lumber.  From  a  judg:ment  of  the  general 
term  (21  N.  Y.  Supp.  83)  affirming  a  judg- 
ment for  plaintiffs  entered  on  a  verdict,  de- 
fendant appeals.     Affirmed. 

For  former  reports,  see  5  N.  Y.  Supp.  949, 
mem.;  8  N.  Y.  Supp.  936,  mem.;  13  N.  Y. 
Supp.  3t¥;;  21  N.  Y.  Supp.  83;  23  N.  E.  736; 
2S  N.  E.  363. 

F.  L.  Westbrook,  for  appellant.  S.  L. 
Stebbins.  for  respondents. 

GRAY.  J.  This  action  which,  for  the 
third  time,  is  brought  to  our  attention,  was 
instituted  to  recover  the  value  of  a  quanti- 
ty of  lumber  wrongfully  talven  and  convert- 
■ed,  as  the  plaintiffs  allege,  by  the  defendant. 
It  had  been  transferred  to  plaintiffs  by  the 
firm  of  G.  &  E.  Harnden  in  payment  of  an 
indebtedness.  The  Plarndeus  were  engaged 
in  the  business  of  boat  building  upon  the 
Delaware  &  Hudson  Canal,  and  in  Novem- 
ber, 1882.  had  contracted  with  the  defendant 
to  build  two  canal  boats,  dmung  the  coming 
winter,  for  delivery  in  the  spring.  In  pur- 
suance of  an  order  from  them,  the  defend- 
ant, subsequently  to  the  making  of  the  con- 
tract, delivered  at  their  yard  lumber  of  the 
quality  and  quantity  requested.  The  con- 
tract between  the  parties  as  to  the  building 
of  the  boats  contained  no  obligation  as  to 
the  ordering  or  the  supplying  of  any  lum- 
ber. When  the  lumber  was  sent,  the  de- 
fendant forwarded  to  the  Harndens  one  of 
their  printed  bills,  or  a  memorandum  with 
blank  spaces  to  be  filled  in  by  writing,  head- 
ed: "Rondout,  N.  Y.,  Nov.  24,  1882.  Messrs. 
G.  &  E.  Harnden  to  the  Delaware  and  Hud- 
son Canal  Co..  Dr.," — and  thereinafter  speci- 
fying the  number  of  feet,  the  kinds,  sizes, 
and  prices  of  the  lumber,  and  the  sum  of 
the  indebtedness.  In  December  following, 
the  Harndens  failed,  and  applied  their  va- 
rious properties  towards  the  discharge  of 
the  claims  of  creditors;  transferring,  as  it 
has  been  said,  this  lumber  to  the  plaintiffs 
by  means  of  a  bill  of  sale. 

The  defendant,  claiming  to  have  always  re- 
tained its  ownersliip  of  tlie  lumber,  intro- 
duced evidence  for  the  purpose  of  showing 
that  the  lumber  had  been  furnished  to  the 
Harndens  only  to  be  used  in  the  boats  con- 
tracted for;  payment  to  be  made  for  it  by 
deduction  of  its  value  from  the  price  of  the 
boats  upon  their  completion  in  the  spring 
It  was  shown  that  it  was  the  custom  for 
the  defendant  to  furnish  its  own  lumber  to 
boat  builders  generally;    but  solely   for  the 


purpose  of  being  used  in  the  construction  of 
boats  it  had  contracted  for,  and  with  the  un- 
derstanding that  its  cost  was  to  be  taken 
out  when  the  boats  were  paid  for.  The  evi- 
dence tended  to  show  that  this  custom  was 
known  to  the  Harndens,  and  that,  while  in 
former  years  they  had  made  cash  payments 
for  lumber  obtained  of  the  defendant,  for 
some  few  years  prior  to  this  transaction,  in 
November,  1882.  they  had  maintained  simi- 
lar contractual  relations  with  defendant  in 
the  building  of  boats,  ordering  lumber  of  the 
defendant  for  the  purpose  of  being  put  into 
boats,  and  having  its  cost  deducted  from  the 
contract  price  of  the  boats.  The  defendant 
has  contended  that  the  ti'ansaction  between 
it  and  the  Harndens  in  the  furnishing  of 
this  lumber  constituted  a  bailment,  only,  of 
the  lumber,  and  not  a  sale,  and  that  its  title 
to  it  was  never  to  be  severed  until  the  lum- 
ber was  actually  used  in  the  construction  of 
the  boats.  Upon  the  first  trial  the  trial 
judge  followed  that  view,  and  nonsuited  the 
plaintiffs.  When  from  that  trial  it  came 
here,  we  held  that,  upon  the  evidence,  wheth- 
er it  was  a  bailment  or  a  sale  of  the  lumber 
was  a  question  for  the  jury  to  determine. 
We  thought  that  the  bill  or  memorandum 
sent  with  the  lumber  was  some  evidence 
that  the  transaction  was  understood  as  a 
sale,  and  that  the  custom  of  the  defendant 
in  supplying  its  lumber  was  not  necessarily 
inconsistent  with  a  sale.  119  N.  Y.  334,  23 
N.  E.  736.  Upon  a  subsequent  trial  the 
plaintiffs  recovered  a  verdict,  and  wlien  the 
case  came  here  again,  upon  the  defendant's 
appeal,  the  judgment  was  reversed,  and  a 
new  trial  ordered,  because  of  error  in  the 
exclusion  of  evidence  offered  by  the  defend- 
ant in  the  testimony  of  the  agent  who  sent 
the  bill  of  sale  or  memorandum,  however  it 
may  be  termed,  to  explain  the  object  or  pur- 
pose in  sending  that  paper.  128  N.  Y.  6.j1, 
28  N.  E.  363.  The  agent  was  the  company's 
paymaster,  whose  duty  it  was  to  send  out 
such  bills  or  statements,  and  w^e  held  that 
his  testimony  to  explain  the  m'eaning  of  the 
bill  being  sent  to  the  Harndens  was  not  ob- 
jectionable as  an  attempt  to  vary  any  con- 
tract between  the  parties.  It  had  been 
made  use  of  by  the  plaintiffs  as  evidence  of 
an  admission  by  the  defendant  of  there  hav- 
ing been  a  sale  of  the  lumber;  and  being, 
by  reason  of  its  informal  character,  consist- 
ent with  either  that  view-,  or  with  the  view 
that  it  was  merely  a  statement  advising  the 
Harndens  of  what  had  been  delivered  under 
their  order,  and  of  what  they  would  have 
to  account  for,  it  was  proper  that  the  de- 
fendant should  have  whatever  benefit  might 
result  from  an  explanation  by  its  agent  of  his 
object  in  sending  it.  Had  the  evidence, 
aside  from  this  bill,  established  that  there 
had  been  a  sale,  then  the  explanation  of  the 
purpose  in  sending  the  bill  might  have  been 
improper.  Such  an  instrument  is  iisually 
deemed  to  be  within  an  exception  to  the 
general  rule  of  evidence,  and,  for  its  inform- 


SALE  DISTINGUISHED  FROM  BAILMENT. 


Vi 


al  and  incomplete  character,  to  be  open  to 
evidence  in  explanation  and  to  throw  li^'ht 
upon  the  contract  between  the  parties.  See 
I'hil.  Ev.  (Cow.  &  H.  and  Edw.  Notes,)  G72; 
Harris  v.  Johnston,  3  Cranch,  311.  Upon 
the  last  trial,  the  evidence  of  the  company's 
ajient  in  explanation  of  the  purpose  of  send- 
iut,'  the  bill  in  question  was  admitted,  and 
was  to  the  effect  that  it  was  sent  upon  this 
occasion  to  the  Harndens  as  it  had  been 
sent  to  them  upon  previous  dealings,  and, 
in  accordance  with  the  company's  universal 
custom,  to  other  parties,  "as  a  memorandum 
of  the  lumber  that  they  had.  and  as  a  memo- 
randum of  the  amount  that  had  to  be  de- 
ducted from  the  contract  price  of  the  boat 
when  the  company  settled  for  it,"  and  that 
it  was  not  sent  for  any  other  purpose.  With 
that  explanation  of  the  company's  agent, 
in  conniNition  with  some  testimony  by  other 
boat  builders  that  the  company  furnished 
lumber  to  all  of  tbem  upon  the  same  terms, 
and  for  the  sole  purpose  described  by  the 
company's  agent,  the  defendant's  counsel  in- 
sists that  the  case  was  so  complete  for  the 
defendant  as  to  have  made  it  the  duty  of 
the  trial  judge  to  decide  the  question,  as 
one  of  law,  in  favor  of  the  defendant,  and 
to  have  nonsuited  the  plaintiffs.  That  the 
evidence  preponderates  in  favor  of  the  de- 
fendant's contention  as  to  what  the  transac- 
tion amounted  to  cannot  be  doubted,  and,  as 
we  have  said  upon  the  previous  occasions 
when  the  case  was  under  review,  we  again 
say  that  the  equities  militate,  and  the  evi- 
dence tends,  strongly  against  the  claim  of 
the  plaintiffs.  It  is  ditficult  to  understand 
how  the  jury  could  have  come  to  the  conclu- 
sion which  they  did  upon  any  fair  and  con- 
scientious consideration  of  the  proofs:  but 
we  cannot  say  that  the  case  had  been  whol- 
ly removed  from  their  province,  and,  if  not, 
then  we  cannot  interfere  with  their  decision 
of  the  issue.  It  does  not  follow  that,  with 
the  evidence  of  the  company's  agent  in  the 
case,  however  strongly  supporting  the  com- 
pany's position,  the  plaintiffs  were  foreclosed 
from  insisting  upon  the  inconclusiveness  of 
the  evidence  relied  upon  by  the  defendant, 
or  ui)on  certain  opposing  inferences  being 
possible  from  the  proofs,  and  that  it  was  the 
province  of  the  jm-y  to  consider  and  decide. 
Nor  was  anything  else  to  be  inferred  from 
our  previous  opinion  than  that  the  evidence 
of  the  company's  agent  was  admissible  in  its 
behalf  upon  the  issues,  in  view  of  the  use 
made  of  this  bill  by  the  plaintiffs,  and  to 
explain  the  object  in  sending  it.  However 
convincing  the  evidence,  to  the  ordinary 
mind,  that  the  defendant  was  right  in  its 
contention,  it  cannot  be  said  that  the  facts 
depended  upon  were  incapable  of  another 
aspect,  or  that,  from  the  circumstances  out  of 
which  they  grew,  and  which  bore  upon  the  re- 
lations of  these  parties,  it  was  impossible  to 
infer  that  this  transaction  was  not  a  sale  of 
the  lumber.  It  is  the  undoubted  rule  that  in 
such  actions  the  plaintiff  must  establish  his 


title  to,  and  riglit  to  the  pusst-ssiun  of,  tho 
property  alleged  to  have  been  wrongfully 
converted;  and  this  was  undertaken  in  this 
ca.se.  The  Harndens  were  in  possession  of 
the  lumber,  and  apjiarently,  from  the  bill 
rendered,  were  indebted  fur  it  as  upon  a  sale 
to  them,  and  they  had  transferred  it  to 
plaintiffs  by  a  bill  of  sale.  It  appeired  th.it 
the  Harndens  had  previously  bought  lumber 
of  the  defendant  for  cash,  and  tl;at.  after  au 
interview  between  a  member  of  that  firm 
and  an  officer  of  the  company,  the  course  of 
dealing  was  changed,  and  credit  was  given  to 
them  for  lumber  ordered  and  delivered. 
With  lumber  so  obtained,  bo.jts  of  otiier  par- 
ties were  repaired,  and  there  was  no  proof 
that  any  restrictions  were  imposed  upon  its 
use.  Nor  did  it  appear  that  anything  was 
said  or  written  as  to  the  title  to  this  lumber 
being  only  conditional  in  the  Harndens. 
Though  its  cost  was  to  be  received  by  tl)< 
defendant  only  when  the  boats  were  built, 
and  then  by  way  of  deduction  from  the  sum 
contracted  to  be  paid  for  the  boats,  that  was 
not  necessarily  conclusive  upon  the  question 
of  the  ownership  meanwhile,  for  the  title  t<- 
an  article  may  pass  upon  a  credit  sale,  if 
such  be  the  intention  of  the  parties.  Anoth- 
er circumstance  was  that  the  company  was 
not  bound  to  accept  and  to  pay  for  the  boat^ 
until  after  inspection  and  approval;  thus  in 
troducing  another  element  of  possible  doubi 
into  the  question  of  title.  All  these  circum- 
stances, and  some  others  of  more  or  less  im- 
portance, were  open  to  the  consideration  of 
the  jiu-y,  in  connection  with  fhe  form  of  the 
bill  for  the  lumber  sent  by  the  comi)any*s 
agent;  and.  as  it  has  been  already  intimated, 
however  strong  may  seem  the  inference  to 
oitr  minds  that  there  was  only  a  conditional 
sale  or  a  bailment  of  the  lumber,  a  different 
inference  was  permissible;  so  that,  under 
the  well-settled  rule,  the  jury  became  the 
proper  judges  between  the  litigants,  and 
their  decision  closes  the  dispute,  in  the  ab- 
sence of  any  en'ors  committed  in  the  coiu'se 
of  trial  which  woidd  authorize  us  to  order  a 
new  trial. 

The  defendant's  counsel  requested  the  trial 
judge  to  charge  "tihat  if  the  jm-y  find  that 
the  evidence  given  by  Larter  that  the  bill 
sent  to  the  Harndens  November  1*4.  INSI'. 
was  sent  only  as  a  memorandum  of  the  quan- 
tity and  of  the  quality  of  the  lumber,  and  its 
value,  is  true,  the  bill  is  not  an  admission 
that  the  lumber  was  sold  to  the  Harndens." 
—to  which  request  be  replied:  "I  decline  to 
charge  in  those  words,  and  will  leave  it  as 
a  question  of  fact,  under  all  the  evidence,  for 
the  jm"y  to  determine  whether  or  not  the 
lumber  was  sold."  We  think  there  was  no 
error  in  this.  Larter  was  the  company's 
paymaster,  and  had  testified  that  the  bill 
had  been  sent  as  previous  ones  had  been 
sent,  namely,  as  a  memorandum  to  show  the 
amount  to  be  deducted  from  the  contract 
price  of  the  boats  when  constructed.  The 
eft'ect  of  that  evidence  upon  the  bill  was  for 


14 


SALK  DISTINGUISHED  FROM   BAILMENT. 


the  jury  to  decide.  It  was  not  legal  error 
for  the  court  to  refuse  to  say  what  would 
become  of  certain  evidence  if  certain  other 
evidence  was  believed;  nor  was  the  coiu-t 
bound  to  put  the  proposition  to  the  jury,  if 
we  assume  its  truth,  as  it  was  formulated  by 
the  counsel.  Conley  v.  Meeker,  S5  N.  Y.  618. 
Therefore,  when,  in  his  reply  to  the  request, 
the  trial  judge  simply  relegated  the  whole  mat- 
ter to  the  jury,  to  be  decided  upon  the  evidence 
before  them,  he  committed  no  error.  In  his 
charge  he  rem/.rked  that  "the  intention  with 
which  a  thing  is  done  does  not  always  con- 
trol the  legal  effect  of  the  thing  done."  That 
is  very  true,  and  did  not  prejudice  the  de- 
fendant's case.  That  object  which  one  may 
propose  to  himself  in  entering  upon  some 
transaction  often  fails  of  its  accomplishment 
by  the  operation  and  intervention  of  rules  of 
law.  The  judge  sufficiently  explained  the 
bearing  of  the  remark.  When  subsequently, 
upon  the  request  of  the  defendant's  counsel, 
be  instructed  the  jury  that  the  minds  of  con- 
tracting parties  must  meet  to  make  a  valid 
contract,  that  the  question  was  one  for  the 
jury  as  to  what  the  contract  was,  and  that 
"if,  from  the  circumstances,  you  are  satisfied 
that  it  was  the  intention  of  both  parties  at 
that  ti»ie  that  the  title  should  pass,— that  then- 
minds  met  upon  that,— tben  you  may  treat 
It  as  a  sale;    if,  from  the  circumstances,  you 


do  not  believe  that  the  parties'  minds  met, 
you  may  treat  it  as  no  sale,"— he  made  it 
clear  enough  what  part  intention  played  in 
the  transaction  of  the  parties,  and  there 
should  have  been  no  confusion  in  their  minds 
about  it. 

The  trial  judge  refused  to  charge  "that  the 
intent  of  Larter  as  to  the  sending  of  the 
bill,  *  *  ♦  if  Larter  is  believed  by  the 
jm-y,  (""oes  determine  the  legal  effect  of  the 
sending  of  the  bill."  This  was  not  error. 
As  it  has  been  said,  Larter  was  following 
the  usage  in  previous  transactions,  and 
though  his  own  intention  in  sending  the  bill 
in  that  form  may,  nevertheless,  have  been 
to  treat  the  matter  as  a  bailment,  and  the 
bill  as  a  mere  memorandum,  that  could  not 
control  the  real  arrangement,  if  it  was  other- 
wise; and  what  that  was  the  facts  and  cir- 
cumstances, taken  all  together,  must  be  con- 
sidered and  weighed,  for  the  absence  of  any 
definite  agreement  upon  the  subject  in  words 
or  in  writings.  We  have  scrupulously  con- 
sidered these  and  other  rulings  upon  re- 
quests to  charge,  and  upon  the  admission 
and  exclusion  of  evidence,  and  we  are  not 
able  to  say  that  there  exists  any  error  which 
would  justify  us  in  permitting  the  defendant 
to  submit  its  case  to  the  chances  of  another 
trial.  The  judgment  should  be  affirmed, 
with  costs.     All  concur.     Judgment  affirmed. 


SALE  DISTINGUISHED  FROM  BAILMENT. 


15 


IRONS  V.  KENTNER. 

(50  N.  W.  73,  51  Iowa.  88.) 
Supreme  Court  of  Iowa.      April  2(J,  1879. 

.\ppeal   from  circuit  court,  Tama   county. 

Action  against  C.  H.  Koutner  to  recover 
the  value  of  wheat  depositetl  by  plaintiff 
and  one  Armstrong,  who  subsequently  as- 
signed his  interest  to  plaintiff,  in  defendant's 
elevator,  and  there  destroyed  bj'  lire  with- 
out defendant's  fault.  The  receipt  given 
Armstrong  and  plaintiff  when  the  wheat 
was  delivered  was  as  follows:  "Bought  of 
T.  K.  Armstrong,  for  C.  H.  Kentner,  to  be 
delivered  at  his  elevator,  according  to  sam- 
ple, wheat  No.  3,  at  owner's  risk  as  to  fire." 
A  memorandum  of  the  quantity  of  wheat 
was  on  the  back  of  the  receipt.  It  was  ad- 
mitted at  the  trial  that  it  was  the  custom 
to  mix  wheat  when  delivered  at  the  elevator, 
and  return  owner's  wheat  of  like  quality, 
and  to  charge  storage  when  the  wheat  re- 
mained in  the  elevator  more  than  a  month. 
.Tudgment  for  plaintiff.  Defendant  appeals. 
Reversed. 

A.  W.  Guernsey  and  O.  H.  Mills,  for  appel- 
lant.    W.  H.  Stivers,  for  appellee. 

KUTHK.OCK,  J.  The  question  we  are  re- 
quired to  determine  is  whether  the  transac- 
tion between  the  contesting  parties  consti- 
tuted a  sale  of  the  wheat  or  a  mere  bailment. 
The  evidence  shows  that  the  wheat  in  ques- 
tion was  not  deposited  in  a  common  bin  with 
other  wheat,  but  that  it  was  placed  in  a 
separate  bin,  where  it  remained  unmixed 
with  other  grain  until  it  was  destroyed  by 
fire.  It  further  appears  that  no  demand  was 
made  for  the  wheat  by  the  plaintiff"  or  Arm- 
strong previous  to  the  fire,  but  that  the  de- 
fendant, by  his  agent,  offered  the  plaintiff 
95  cents  per  bushel  on  the  Saturday  before 
the  fire.  In  Johnston  v.  Browne,  37  Iowa, 
20(J,  the  ticket  or  memorandum  given  by 
Browne  on  receiving  the  grain  in  the  ele- 
vator was  in  these  words:  "Bought  of  H. 
T.  Pickett,  for  W.  P.  Browne,  to  be  deliver- 
ed at  Browne's  elevator,  if  all  like  sample 
of  wheat,  at  $ .  in  store, buy- 
er,   bushels, lbs."     It  was  shown 

in  that  case,  by  extrinsic  evidence,  that  the 
understanding  of  the  parties  was  that 
Browne,  the  proprietor  of  the  elevator,  was 
to  ship  and  sell  the  grain  on  his  own  ac- 
<-ouut,  and,  when  the  depositor  desired  to 
sell,  Browne  was  to  pay  the  highest  price 
for  the  grain,  or  return  a  like  quantity  and 
quality.  That  transaction  was  held  to  be 
a  sale,  and  not  a  mere  storage  or  bailment 
of  the  grain.  In  Nelson  v.  Brown,  44  Iowa, 
455,  the  ticket  or  memorandum  delivered  to 


the  depositor  of  the  grain  was  in  these 
wol-ds:  "Received  of  C.  C.  Co  well,  for 
Thompson,  in  store,  for  account  and  risk  of 
C.  C.  Cowell,  one  hundred  and  eighty-three 
bushels  No.  3  wheat.  Loss  by  fire,  heating, 
and  the  elements  at  the  owner's  risk.  Wheat 
of  equal  test  and  value,  but  not  the  identical 
wheat,  may  be  returned."  It  was  held  In 
that  case  that  so  hmg  as  the  wheat  remain- 
ed in  the  elevator,  though  thrown  in  a  com- 
mon bin  with  wheat  of  like  (luality,  the 
transacHou  was  a  mere  bailment.  It  is  there 
said:  "But  the  warehouseman  is  not  under 
obligation  to  retain  the  wheat  of  the  de- 
positor in  his  warehouse.  He  may,  without 
breach  of  contract,  and  without  being  guilty 
of  conversion,  ship  the  wheat  away  on  his 
own  account.  "When  he  avails  himself  of 
this  privilege,  the  character  of  the  transac- 
tion and  the  relation  of  the  parties  change." 
In  the  case  at  bar  the  ticket  or  memoran- 
dum expresses  no  completed  contract  upon 
its  face.  In  this  respect  it  is  unlike  the 
contract  in  Marks  v.  Elevator  Co.,  43  Iowa. 
146,  where  it  was  held  the  contract  could 
not  be  explained  by  parol  evidence,  because 
it  was  complete  in  its  terms.  In  this  case 
no  action  can  be  maintained  upon  the  in- 
strument without  the  aid  of  extrinsic  evi- 
dence. Parol  evidence  is  necessary  to  fix 
ihe  price  agreed  to  be  paid  if  it  should  be 
held  to  be  a  contract  of  sale,  and,  whether 
a  sale  or  mere  l)ailmeut.  parol  evidence  is 
necessary  to  explain  the  figures  indorsed  on 
the  instrument.  It  was  admitted  the  grain 
was  delivered  in  pursuance  of  the  alleged 
custom  or  usage,  and  it  was  shown  that  it 
was  in  the  elevator  in  a  separate  bin  when 
it  was  burned,  and  that  tlie  defendant  of- 
fered to  purchase  it  on  the  Saturday  before 
the  fire.  These  facts,  when  taken  in  con- 
nection with  the  ticket,  show  clearly  that 
the  transaction  was  not  a  sale,  but  a  bail- 
ment. It  is  true  that  the  word  "bought"  in 
the  ticket,  unexplained,  would  import  a  sale, 
but,  when  taken  in  connection  with  the  ex- 
pression "at  owner's  risk  of  fire,"  and  in 
the  light  of  the  parol  evidence,  it  clearly  ap- 
pears that  a  sale  was  not  contemplated  by 
the  parties.  "At  owner's  risk  of  fire"  evi- 
dently means  that,  so  long  as  the  wheat 
should  remain  in  the  elevator,  the  jilaintiff 
should  bear  that  risk.  If  it  was  a  sale.  It  is 
not  at  all  probable  that  any  such  words 
would  have  been  used.  In  such  case,  the 
warehouseman  would  have  assumed  the  risk 
witliout  any  stipulation  to  that  effect. 

We  think  the  case  is  clearly  within  the 
rule  of  Nelson  v.  Brown,  supra,  and  that, 
as  the  identical  wheat  remained  in  the  ele- 
vator, and  was  consume«l  with  it,  the  de- 
fendant  is   not    liable.     Reversed. 


16 


SALE  DISTINGUISHED  FROM   BAILMENT. 


STURM  V.  BOKER  et  al. 

(14  Sup.  Ct.  99,  150  U.  S.  312.) 

Supreme  Court  of  the  United  States.      Nov.  20, 

ISO;?. 

Appeal  from  the  circuit  court  of  ttie  United 
States  for  tlie  district  of  Indiana.     Reversed. 

Solomon  Clayijool  and  Johu  M.  Butler,  for 
appellant.  Albert  Balder,  Wm.  D.  Guthrie, 
and  C.  A.  Seward,  for  appellees. 

.Mr.  Justice  JACKSON  delivered  the  opinion 
of  Iho  court. 

'I'liis  suit,  as  originally  instituted,  was  an 
action  at  law  l)y  the  appellant,  in  the  supe- 
rior court  of  Marion  county,  lud.,  against  the 
defendants,  to  recover  the  sum  of  $238,U(J0, 
with  interest  thereon,  for  which  sum,  the 
plaintiff  alleged,  they  were  indebted  to  him. 
The  defendants,  being  citizens  of  New  York, 
removed  the  cause  to  the  circuit  court  of  the 
United  States;  and,  as  the  claim  involved  va- 
rious matters  of  account,  rmuiiug  through  a 
period  of  several  years,  the  court,  on  motion 
of  the  defendants,  transferred  the  cause  to 
the  equity  docket,  and  required  the  plain- 
tiff to  reform  his  pleadings.  In  compliance 
with  tliis  order,  the  plaintiff  tiled  his  bill  of 
complaint,  setting  forth  various  transactions 
involving  matters  of  account  between  him- 
self and  the  defendants,  commencing  in  Sep- 
tember, 1867,  and  continuing  down  to  Sep- 
tember, 1876.  The  answer  of  the  defendants 
admitted  many  of  the  facts  charged,  and 
eillier  denied  others,  or  set  up  new  matter  in 
avoidance  diereof. 

The  several  items  of  account  presented  by 
the  pleadings  jieed  not  be  specially  men- 
tioned, or  separately  considered,  nor  is  it 
deemed  necessary,  in  the  view  we  entertain 
of  the  case,  to  review  the  immense  volume 
of  testimony  taken  in  the  course  of  the  liti- 
gation,— covering  about  4,000  printed  pages, — 
involving  irreconcilable  conflicts,  and  includ- 
ing much  that  is  wholly  irrelevant.  The  ma- 
terial facts  are  clearly  established  by  the 
written  agi'eement  of  tlie  parties,  and  by  the 
admissions  made  in  the  pleadings;  and  the 
controlling  question  of  law'  arising  thereon, 
and  upon  which  the  correctness  of  the  decree 
dismissing  the  bill  must  be  detennined,  is 
whether  the  court  below  placed  the  proper 
construction  upon  the  original  contract  en- 
tered into  between  the  parties,  under  which 
the  defendants  consigned  certain  arms  and 
numitions  of  war  to  the  complainant,  to  be 
by  him  shipped  to,  and  sold  in,  Mexico.  That 
c-ontract,  after  some  previous  verbal  negotia- 
ti(ms,  was  (embraced  in  the  following  corre- 
spondence: 

"Office  of  Hermann  Boker  Co.,  No.  50  Cliff 
Street. 

"New  York,  September  18th,  1867. 
'•General  H.  Stm-m,  present. 

"Dear  Sir:  Inclosed  please  liud  our  bill  of 
fetmdry  arms,  etc.,  amounting  to  $39,887.60, 
for  whicii  amount  please  give  us  credit  on 
consignment  account. 


"As  mutually  agreed,  we  consign  these 
arms  to  your  care,  to  be  shipped  to  Mexico^ 
and  to  be  sold  there  by  you  to  the  best  ad- 
vantage. Should  these  arms  not  be  dlsi.osed 
of  at  tlie  Avhole  amount  charged,  we  have  ta 
bear  the  loss.  Should  there  bo  any  profit 
realized  over  the  above  amount  of  bill,  such 
protit  shall  be  equally  divided  between  your- 
self and  us. 

"Also,  it  is  understood  that  all  these  goods 
are  sliipi>ed  by  you  free  of  any  expenses  to 
us,  and  that,  in  c;ise  all  or  any  of  them  should 
not  be  sold,  Uiey  shall  be  reiurued  to  us  free 
of  all  charges. 

"As  you  have  insured  these  goods,  as  well 
as  other  merchandise,  we  should  be  pleased 
to  have  the  aiiiouut  of  $40,000  transferred  to 
us.  Please  ackuowletlge  the  receipt  of  this, 
expressing  your  acquiescence  in  above,  and 
oblige, 

'"Yours,  truly,      Hermann  Boker  &  Co." 

Accompanying  this  letter  was  an  invoice, 
in  form  as  follows: 

"No  deduction  allowed  for  errors  or  dam- 
ages unless  claiiu  is  made  within  five  days 
after  the  goods  are  received. 

"Herman  Funke.     Folio . 

"F.  A.  Boker. 

"50  Cliff  Street.  New  York, 
"F.  Schumacher.  Sept.  18th,  1867. 

"Mr.  H.  Sturm  in  joint  acc"t  with  Hermann 
Boker  &  Co.: 

"Payable  in  gold. 
"Terms,  net  cash. 
"Forwarded  for  your  account  and  risk,  per 

1  12-DOunder  battery,  brass, 
ccmplete $  9,000 

1  3-i'ifled  battery,  iron,  com- 
pleto 8,000 

$17,000 

73  cases  of  20  ea.  |  1,470  Spring- 

>   field  R.  mus- 
1      "         10  «    )    kets,  8.00...  $11,760 

74  cases,  3.50 259 

13,019 

1,000  r'tis  fixed  ammunition.  12 

p.,  2.00 $  2,000 

504  r'ds  fixed  ammunition,  24 

pd.,  2.00 1,008 

209  boxes : 
lOD.OOO  Enfleld  cartridges,  12.00     1,203 

100  boxes : 
200,000  Maynards,  20.50 4,100 

8,308 

200  boxes : 

670    pare,   shell,  3    Hotchkiss, 

1.25 $  837  50 

680  time  fuse,  3  Hotchkiss,  1.25  S.'iO  00 

270  case  shot,  3           "            1.55  428  .50 

ISO  canister,  3             "            1.00  180  00 

153  boxes,  painted,  1.50 229  50 

27       "        not  painted.  130 35  10 

2,560  60 

$3'J.887  60" 
To  which  complainant  replied: 

"New  York,  Sept.  20th,  1867. 
"Messrs.  Hermann  Boker  &  Co. 

"Gents:  I  have  the  honor  to  acknowledge 
the  receipt  of  your  letter  of  the  18th  inst.,  in 


SALE  DISTINGUISHED  FKo.M  I'.A  1  L.MKNT. 


17 


which  you  inclose  bill  of  sundry  arms, 
amounting  to  $3'J,887.60,  consijiucd  to  me 
upon  certain  conditions  contained  in  said 
letter. 

"In  reply,  I  have  to  say  that  I  accept  the 
terms  of  said  conditions  of  consi.iininont,  and, 
as  soon  as  I  obtain  the  policies  of  insurance 
upon  said  goods,  will  transfer  them  to  you. 
"Very  respectfully,  your  ob't  servant, 

"H.  Sturm." 

There  was  another  consignment,  the  terms 
of  which  are  contained  in  the  letters  of  Oc- 
tober 24.  1807,  as  foUows: 

"New  York,  October  24th,  1867. 
"General  H.  Sturm,  present. 

"Dear  Sir:  Inclosed  we  b  g  to  hand  you 
our  bill  for  muskets,  amounting  to  $10,175, 
for  which  please  give  us  credit  on  consign- 
ment account. 

"As  mutually  agreed  we  consi.gn  these  arms 
to  your  care,  to  be  shipped  to  Mexico,  and 
to  be  sold  there  by  you  to  the  best  advan- 
tage. 

"Should  these  arms  not  be  disposed  of  at 
the  amount  charged  we  have  to  stand  the 
loss.  Should  there  be  any  profit  realized  over 
the  above  amount,  such  profit  shall  be  equal- 
ly divided  between  yourself  and  us. 

"It  is  also  understood  that  these  goods  shall 
be  shipped  by  you  free  of  any  expenses  to 
us,  and  that,  in  case  they  should  not  find  a 
ready  sale,  they  shall  be  returned  to  us  free 
of  all  charges. 

"Please  attend  to  the  insiu-ance  of  this  lot, 
and  have  the  amount  transferre<l  to  us  in 
one  policy;  also,  please  acknowledge  the  i*e- 
ceipt  of  this,  stating  your  acquiescence  in 
above.  We  likewise  beg  to  hand  you  in- 
closed the  San  Francisco  draft  of  Placido 
Vega,  $Go,G99.G0  gold,  with  protest  and  power 
of  attorney  to  collect,  with  legal  interest, 
same  attached.  V^^e  will  allow  you  a  commis- 
sion for  collecting  this  draft  and  interest  foi 
us,  of  ten  per  cent,  off  the  amount. 

"Be  kind  enough  to  acknowledge  the  re- 
ceipt of  this  draft. 

"Wishing  you  a  pleasant  trip,  and  pros- 
perous affairs,  we  beg  to  remain, 

"Yours,  truly,  *■ 

[Signed]  "Hermann  Boker  &  Co." 

"New  York,  October  24th,  1867. 
"CJeneral  H.  Sturm. 

"Dear  Sir:  We  beg  to  refer  to  our  annexed 
letter,  contents  of  which  we  expressed  ac- 
cording to  our  mutual  agreement.  We  now 
beg  to  say.  in  order  to  avoid  any  misunder- 
standing hereafter,  that  with  regard  to  the 
two  lots  of  new  Springfield  rifles  shipped  to 
your  care,  viz. 

"1,470  and  74  cases  and 

"1,000     "     50     " 
we  should  direct  as  follows: 

"Should  these  mentioned  arms  not  bring 
the  prices  as  charged  by  us,  viz.  .?8.00  apiece 
for  the  first  and  .$10.00  apiece  for  the  second 
lot,  then  we  would  I'espectfully  request  you 

VAN  ZILE  SEL.C-\S.SALES— 2 


to  have  ilicin  returned  to  us  free  of  expanses, 
as  agreed. 

"Please  e.xpress  your  acquiescence  In  above 
and  oblige, 

"Yours,  trulj', 

[Signed]  "Ilormann    Hok'-r   &   f'o." 

The   invoice   which   acconqianied    tliis   hist 
consignment  is  as  follows: 

"Office  of  Herman  Boker  &  Co., 

"No.  50  Cliff  Street,  New  York, 
"(October  24,  1807. 
"II.  Sturm,  Esq..  N.  Y.: 

"Bought  of  Herman  Boker  &  C ).,  in  joint 
account, 
"50  cases  containing: 

1,000  new  Springfield  muskets  @  $10 $10,000 

50  cases  (§  ^3.50 175 


$10,175" 


While  it  is  clearly  established  that  both  of 
these  consignments  were  made  upon  the  same 
terms  and  conditions,  the  invoices  which  ac- 
companied them  differed  in  some  respects. 
The  bill  accompanying  the  October  consign- 
ment was  entirely  in  writing,  while  the  in- 
voice accompanying  the  September  consign- 
ment was  written  under  a  printed  billhead 
of  the  defendants.  The  printed  heading  wa.s 
not  changed,  except  by  erasing  the  words, 
"bought  of,"  and  inserting  in  their  place  th«' 
words,  "Mr.  H.  Sturm  in  joint  acc't  with." 
The  words,  "Payable  in  gold,"  appear  to  have 
been  stamped  on  the  bill,  but  whether  this 
was  done  at  the  time  of  its  delivery  to  the 
complainant,  or  subseciuently,  when  the  de- 
fendants regained  possession  of  the  bill,  is  a 
question  of  di-spute  between  the  parties;  and 
under  the  testimony  it  is  a  matter  of  grave 
doubt  whether  they  formed  a  part  of  the  in- 
voice bill,  as  originally  rendered,  but  it  is 
not  deemed  necessary  to  dettn-mine  this  con- 
troverted question  of  fact. 

-i-ue  October  consignment,  which  was  in- 
.sured  by  the  defendants  themselves,  and  was 
shipped  by  the  .steamer  Wilmington,  reached 
Jlexico  safely,  and  causes  no  controversy  be- 
tAveen  the  parties  except  as  to  a  portion  of 
the  proceeds  arising  from  the  sale  thereof, 
which  was  received  by  the  defendants. 

The  September  consignment,  together  witJi 
similar  goods  of  the  value  of  $109,51tj,  be- 
longing to  the  complainant,  were  shipped  on 
the  schooner  Keese  and  brig  Blonde.  The 
Blonde  carried  of  the  consigned  goods,  $10,- 
.500.00,  and  of  the  complainant's  goods,  $17,- 
250,  while  the  Keese  canled  of  the  consigned 
goods,  .$29,327,  and  of  complainant's  goods, 
$1.52,2(50. 

The  goods  shipped  on  both  vessels  were  in- 
suretl  in  14  separate  policies.  These  policies 
were  made  out  in  the  name  of  Sturm,  "for 
account  of  whom  it  might  concern."  The 
whole  amount  of  insurance  on  the  goods 
carried  by  the  Blonde  was  $.30.(K»0.  while 
the  total  insurance  on  the  goods,  individual 
and  consigned,  can^ied  by  the  Keese,  was 
$L0o,000.      This      insurance    was      efifected 


38 


SALE  DISTINGUISHED  FIU^M   BAILMENT. 


thronfjh  an  insurance  broker,  who  was  in- 
formed that  rh^'  defciKhiiits  had  an  interest 
of  alwjut  $4i»,00U  in  the  goods  to  be  eovcn-ed 
by  the  policies,  and  who  was  directed  to 
eousiilt  Mr.  Funke,  tlie  member  of  defend- 
ants' firm  with  whom  the  coniplainant  liad 
chieflj-  condiictfMl  the  transaction  in  contro- 
versy, as  to  liow  tliose  policies  should  be 
made.  This  he  did,  and  with  the  consent, 
and  by  the  diri'ction,  of  Mr.  Funke,  he  took 
the  whole  lot  of  insurance  together,  in  the 
name  of  complainant,  "for  account  of  whom 
it  might  concern,"  and  appropriated  for  the 
benefit  of  the  defendants,  and  handed  over 
1o  tliem,  by  the  in.struction  of  the  complain- 
ant and  of  Funke,  fom*  policies  on  the  cargo 
of  the  Keese  amounting  to  $r)5,(K)0,  i.'-sued,  re- 
spectively, by  the  Sun,  the  New  York,  the 
Orient,  and  the  JNIercantile  Insurance  Com- 
panies, and  one  policy  for  $15,000  issued  by 
the  United  States  Lloyds  Insurance  Company 
on  the  cargo  of  the  Blonde.  These  four  pol- 
icies on  the  Keese,  together  with  the  one 
on  the  Blonde.  I  lie  insurance  broker  selected 
for  the  defendants  at  their  request,  as  be- 
ing issued  by  good  companies,  and  they 
were  delivered  to  the  defendants  about  the 
date  of  their  issuance. 

The  policies  thus  delivered  to  them,  as 
imderstood  by  the  broker  who  selected  and 
turned  them  over  to  the  defendants,  were 
intended  to  cover  their  intei-est  in  the  insured 
cargo  of  the  Kei'se  and  Blonde.  The  amount 
of  the  policies  so  delivered  to  defendants 
was  in  excess  of  the  invoice  prices  of  the 
consigned  goods,  for  the  reason,  as  alleged, 
that  policies  covering  the  exact  amount 
could  not  be  selected,  but  with  the  under- 
standing that  the  excess  was  to  be  held  for 
account  of  the  complainant. 

The  vessels  carrying  the  cargo  .sailed  for 
Mexico  in  September.  1867,— a  few  days 
after  the  insurance  was  effected.  On  the 
voyage  the  Blonde  was  caught  in  a  storm, 
and  part  of  her  cargo  was  thrown  overboard 
to  save  the  vessel.  The  insured  goods  had 
to  conti-ibute  to  the  general  average  the  sum 
of  .$1,403.84,  which  was  paid  by  the  com- 
plainant, who  also  paid  out  the  further  .sum 
of '.$072.78  for  repairing  part  of  the  con- 
signed goods,  which  reached  Mexico  in  a 
damaged  condition.  Half  of  the  amount 
paid  on  general  average,  and  the  amoimt 
paid  for  repaii-s  upon  the  consigned  goods, 
are  the  only  items  of  account  in  controversy, 
so  far  as  conctu'ris  the  shipment  made  upon 
the  Blonde,  nothing  having  been  recovered, 
either  by  complainant  or  defendants,  upon 
the  insm'ance  polici(^s  taken  out  on  the  cargo 
which  she  carried.  That  shipment,  except 
in  respect  to  the  itt  nis  paid  on  general  aver- 
age and  for  repairs,  may  therefoi'e  be 
di'opped  out  of  further  consideration. 

The  Keese,  cariying  $29,327  of  the  con- 
signed goods,  and  $1.">2,200  of  complainant's 
individual  goods,  and  covered  by  12  policies 
of  insurance,  amounting  to  .$103,000,  was 
wrev-ked    ou    her    voyage,    without    fault    or 


negligence  on  the  part  of  complainant,   and 
her  cargo  was  totally  lost. 

The  complainant  had  reached  Havana,  on 
his  way  to  ^Mexico,  when  he  learned  of  the 
loss  of  the  Keese  and  her  cargo,  and  promptly 
notified  the  defendants,  by  telegram,  of  the 
fact.  The  defendants  thereupon  called  fo^ 
and  received  frosn  the  complainant's  agent  ii-. 
New  York  city  the  invoice  which  accom- 
panied the  consignment  of  September  18, 
1867,  for  the  purpose  of  preparing  and  mak- 
ing proof  of  the  loss.  The  insurance  com- 
panies refused  to  pay  the  policies,  on  various 
grounds,   which  need   not  be  noticed  here. 

The  complainant  returned  to  New  York  in 
March.  1808,  and,  leai-ning  that  the  insur- 
ance companies  contested  their  liability  for 
the  loss,  arranged  with  the  defendants  'to 
institute  suits  against  the  companies  to  re- 
cover on  the  policies  held  by  them,  respec- 
tively. The  def'Midants  employed  Mr.  D:i 
Costa  to  sue  upon  the  policies  held  by  them, 
while  the  complainant  employed  Mr.  Parsons 
to  sue  upon  his.  and  the  lawyers  were  to 
co-operate  and  a.ssist  each  other  in  the  pros- 
ecution of  all  the  suits. 

About  the  time  this  arrangement  was  made, 
the  complainant  opened  a  bank  account  with 
the  defendants,  and  thereafter  made  deposits 
with  and  drew  checks  and  drafts  upon  them, 
as  his  bankers,  down  to  the  latter  part  of 
187.5. 

The  litigation  against  the  insurance  com- 
panies continued  until  September  13,  1876, 
when  the  last  collection  upon  the  policies 
was  made.  During  the  progress  of  the  liti- 
gation, the  complainant  tiu'ned  over,  or  as- 
signed, to  the  defendants  such  judgments  as 
he  had  obtained,  and  such  policies  standing 
in  his  name  as  had  not  been  reduced  to 
judgment,  as  alleged,  for  the  purpose  of 
convenience  in  collection  and  settlement,  and 
with  the  view  of  having  the  amounts  col- 
lected thereon  placed  to  his  credit.  The 
fimds  collected  upon  all  the  policies,  amount- 
ing to  about  $109,000.  went  into  the  hands 
of  the  defendants.  The  complainant  claims 
that  his  interest  and  that  of  defendants 
in  the  amounts  recovei'ed  is  in  the  ratio  of 
$152,200  to  $29,327,— that  being  their  rela- 
tive pi-oportion  in  the  total  amount  of  in- 
sm'ance,— and  that  the  defendants  ought  to 
account  to  him  according  to  that  proportion, 
and  pay  their  just  share  of  the  expenses  in- 
cident to  the  collection  thereof,  as  well  as 
compensate  him  for  his  services  in  connection 
with  the  suits.  These,  and  other  smaller 
items  of  account,  constitute  the  matters  in 
controversy. 

While  admitting  the  general  facts  in  re- 
spect to  the  transaction,  the  defendants  .set 
up  in  their  answer  that  by  the  terms  of  the 
contract  the  <'omplainant  became  the  in 
surer  of  the  goods,  and  was  boxmd  thereby 
to  either  sell  them  in  Mexico,  and  accoimt 
for  the  proceeds,  or  to  return  them  to  New 
York  free  of  all  exi>en.se  to  the  defendants, 
and  that,  recognizing  such  liability,  the  com- 


SALE   DISTIXGriSriED  FRO.M  BAILMENT. 


19 


plain.ant  insured  all  the  goods,  making  no 
distinction  in  tlio  manner  of  such  insm-unce 
between  his  indiviihial  goods  and  the  con- 
signed goods,  and  that  the  policies  trans- 
ferred to  the  defendants  by  the  complainant 
were  transferred  as  collateral  se;in'it.v  for 
the  performance  of  the  contract,  which  was 
upon  a  gold  valuation,  and  that  no  part  of 
the  policies  was  held  in  trust  for  the  com- 
phiinant. 

On  this  theory,  the  defendants  kept  their 
account  of  the  transaction  in  the  name  of 
the  "Mexican  Arms  Account,"  in  which  the 
goods  consigned  were  charged  at  the  price  of 
f.SD.SST.GO,  and  to  this  was  added  the  pre- 
mium upon  gold  at  45  per  cent.,  amounting 
to  .$1T,!»4!>.42;  and,  on  the  aggregate  of  thesu 
two  sums,  interest  was  computed  from  Sep- 
tember, 1807,  to  May  1,  18S2,  amounting  to 
$r)8,S01.28.  This  account  was  also  charged 
with  the  expenses  connected  with  the  suits 
on  the  policies  turned  over  to  them,  amount- 
ing, with  interest,  to  $16,710.72.  Thevse  ex- 
p(>nses  consisted  of  attorneys'  fees  and  sun- 
dry oiitlays  for  witnesses  in  connection  with 
the  suits.  These  various  items  were  not 
charged  or  entered  as  debits  against  Sturra 
until  187G,  when  they  were  transferred  from 
the  ?dexican  arms  account  to  his  account. 

The  defendants'  coustiTiction  of  the  con- 
tract, and  method  of  keeping  the  account, 
was  not  communicated  to  the  complainant 
until  some  time  in  1876,  when  he  promptly 
denied  its  correetness.  The  court  below 
adopted  the  defendants'  inteipretation  of  the 
contract,  holding  that  the  consigned  goods 
were  at  the  risk  of  complainant;  that  he 
was  responsible  for  their  loss,  although  aris- 
ing from  inevitable  accident,  t)ecause  he  had 
undertaken  to  I'eturn  them  if  not  sold;  and 
that,  being  so  responsible,  the  defendants 
had  a  right  to  charge  him  with  the  value 
thei-eof,  and  treat  the  policies  turned  over 
to  them  as  collateral  security  for  this  lia- 
bility, and  were,  furthermore,  entitletl  to 
charge  him  with  the  expenses  of  collecting 
such  policies,  so  that  the  complainant  was 
entitled  to  credit  only  for  the  net  amounts 
collected  thereon.  For  .this,  and  the  further 
reason,  as  the  court  assumed,  that  the  com- 
plainant had  given  testimony  in  the  insur- 
ance cases,  and  made  admissions  under  oath, 
which  were  inconsistent  with  his  present 
claim,  and  which  should  repel  him  from  a 
court  of  equity,  his  bill  was  dismissed. 

If,  by  the  terms  of  the  contract,  as  em- 
bodied in  the  lettere  of  September  IS  and 
October  24.  1867,  the  title  to  the  goods  vest- 
ed in  the  complainant,  or  they  were  to  be  at 
his  risk  dui-ing  their  transit  to  ^Mexico,  then 
it  is  conceded  that  upon  an  adjustment  of 
the  accoimts  between  the  parties  on  that  ba- 
sis, with  the  allowance  to  the  defendants  of 
a  premium  of  45  per  cent,  for  gold,  tliere  is 
little  or  nothing  due  to  the  complainant,  and 
no  substantial  error  in  the  decree  dismissing 
his  bill.  On  the  other  hand,  if  the  title  to 
the  goods  delivered  did  not  vest  in  the  com- 


plainant under  the  terms  of  the  consign- 
ment, or  he  was  not  responsible  for  the  loss 
of  the  sjime  by  inevital)le  accident,  then  the 
court  below  was  in  error  in  dismi.ssing  his 
bill,  and  denying  the  account  sought. 

It  is  too  clear  for  disciLssion,  or  tlie  citation 
of  authorities,  that  the  contract  was  not  a 
sale  of  the  goods  by  the  defendants  to  Sturm. 
Tlie  terms  and  conditions  under  which  the 
goods  were  delivered  to  him  import  only  a 
consignment.  The  words  "consign"  and 
"consigned,"  employed  in  the  letters,  were 
iLsed  in  their  commercial  sense,  which  meant 
that  tiie  i)rop('rty  was  committed  or  iutiiist- 
ed  to  Sturm  for  care  or  sale,  and  did  not,  by 
any  expre.ss  or  fair  implication,  mean  the 
sale  by  the  one,  or  purchase  by  the  other. 
The  words,  "Mr.  H.  Sturm  in  joint  account 
with  Hermann  Boker  &  Co.,"  or  "I'xmght  of 
Hermann  Boker  &  Co.,  in  joint  ac((;unt,"  in 
the  billhead,  cannot  be  allowed  to  control  the 
express  written  terms  contained  in  the  con- 
tract, as  set  forth  in  the  lettei-s.  A  printed 
billhead  can  have  little  or  no  influence  in 
changing  the  clear  and  explicit  language  of 
the  lettei*s,  and  it  in  no  waj'  controls,  modi- 
fies, or  altei-s  the  terms  of  the  contract. 
The  purpose  and  object  of  the  bill  were  to 
give  a  description  and  valuation  of  the  arti- 
cles to  which  the  contract,  as  embraced  in 
the  letters,  had  reference;  their  description 
being  important,  if  the  articles  had  to  be  re 
timied.  and  their  price  or  valuation  neces 
saiy,  if  they  were  sold,  and  profits  weiv 
made  for  division.  The  contract  being  chnir- 
ly  expressed  in  writing,  the  printed  billhead 
of  the  invoice  can,  upon  no  well-s<'ttle<i  nile, 
control,  modify,  or  alter  it.  That  the  invoice 
was  not  intended  to  have  that  effect  is 
shown  by  the  fact  that  the  invoice  of  the 
consignment  of  October  24th  differed  in  sev- 
eral respects  from  the  invoice  of  September 
18th.  although  the  tenns  and  conditions  in 
respect  to  each  consignment  were  the  same. 

In  Schenck  v.  Saunders.  13  Gray,  37,  there 
was  a  written  agreement  in  these  terms: 

"The  said  Schenck,  Wood  &  Pond,  of  the 
tii-st  part,  agree  to  funiisli  the  stock,  consist- 
ing of  upper  and  sole  k^ather  and  linings  and 
bindings,  of  sufficient  amount  to  make  at 
least  eight,  and  not  to  exceed  twenty,  cases 
per  week.  And  the  said  Cliarles  Howe,  of 
the  second  part,  is  to  take  the  stock,  and 
make  it  up,  to  the  best  of  his  abilities,  into 
women's  boots,  and  further  agrees  to  consign 
all  the  goods  he  makes  to  the  said  Schenck, 
Wood  &  Pond,  of  the  lii-st  part,  to  be  sold  by 
them  on  commission  of  Ave  per  cent.;  the 
goods  to  be  sold  for  cash,  and  the  retiu-n.s 
made  to  the  sjiid  Charles  Howe  as  fast  as 
made.  And  the  s;iid  Charles  Howe,  of  the 
second  part,  agrees  to  put  up  and  ship  to  the 
said  Schenck,  Wood  &  Pond,  at  their  store 
in  New  York,  at  least  eight  cases  of  boots 
per  week,  each  case  containing  sixty  pairs, 
commencing  the  first  week  in  May,  JS5(»." 

With  each  shipment  of  leather  to  Howe, 
Schenck,   Wood  &  Pond  sent  him   unsigned 


20 


SALE  DISTINGUISHED  FROM   BAILMENT. 


bills,  like  those  in  the   present  c:ise,  in  this 
form : 

"Boot,  Shoe  and  Leather  Warehouse. 
"New  York,  May  15,  1856. 
"Mr.   Charles  Howe, 
"Bought  of  Schenck,  Wood   &  Pond, 
"Manufacturera  and  Commission  Merchants, 
"No.  25  Beekmau  Street. 
"Terms  6  months. 


'52  sides,  sole  leather  B.  A.,  644,  26)-^. 
'  Inspection  and  cartage 


. .  $170  66 
90 


"$171  56" 

In  a  contest  as  to  the  title  of  these  goods 
(boots)  between  Schenck,  Wood  &  Pond  and 
an  assignee  of  Howe,  it  was  contended, 
among  other  things,  that  the  invoices  show- 
ed that  the  transaction  was  a  sale  to  Howe, 
and  the  heading  of  the  bills  was  relied  upon 
to  give  such  construction  to  the  contract. 
The  supreme  court  of  Massachusetts,  speak- 
ing by  Bigelow,  J.,  held  that  the  transaction 
was  not  a  sale,  and  that  "the  bills  of  par- 
cels which  were  sent  from  time  to  time  with 
the  merchandise  were  susceptible  of  ex- 
planation by  parol  evidence,  and  did  not 
change  the  terms  of  the  written  agreement 
under  which  the  property  was  sent  to  Howe. 
They  were  sent  only  as  memoranda  of  the 
amovmt  and  value  of  the  merchandise  trans- 
mitted.    Hazard  v.  Loring,  10  Cush.  2G7." 

"An  invoice,"  as  said  by  this  court  in  Doavs 
V.  Bank,  91  U.  S.  630,  "is  not  a  bill  of  sale, 
nor  is  it  evidence  of  a  sale.  It  is  a  mere 
detailed  statement  of  the  nature,  quantity, 
or  cost  of  the  goods,  or  price  of  the  things 
invoiced,  and  it  is  as  appropriate  to  a  bail- 
ment as  a  sale.  Hence,  standing  alone,  it  is 
never  regarded  as  evidence  of  title." 

Was  the  contract,  as  claimed  by  counsel 
for  the  defendants,  a  contract  of  "sale  or  re- 
turn?" We  think  not.  The  class  of  con- 
tracts known  as  contracts  of  "sale  or  return" 
exist  where  the  privilege  of  purchase  or  re- 
turn is  not  dependent  upon  the  character  or 
quality  of  the  property  sold,  but  rests  en- 
tirely upon  the  option  of  the  purchaser  to 
retain  or  return.  In  this  class  of  cases  the 
title  passes  to  the  purchaser,  subject  to  his 
option  to  return  the  property  within  a  time 
specified,  or  a  reasonable  time;  and  if  be- 
fore the  expiration  of  «uch  time,  or  the  ex- 
ercise of  the  option  given,  the  property  is  de- 
stroyed, even  by  inevitable  accident,  the  buy- 
er is  responsil)le  for  the  price. 

The  true  distinction  is  pointed  out  by 
Wells,  J.,  in  Hunt  v.  Wyman,  100  ]Mass.  200, 
as  follows:  "An  option  to  purchase  if  he 
liked  is  essentially  different  from  an  option 
to  return  a  purchase  if  he  should  not  like. 
In  one  case,  the  title  will  not  pass  until  the 
option  is  determined.  In  the  other,  the  prop- 
erty passes  at  once,  sxibject  to  the  right  to 
rescind  and  return." 

The  cases  cited  and  relied  on  by  the  defend- 
ants (:Moss  v.  Sweet,  16  Q.  B.  493,  494;    Mar- 


tineau  v.  Kitching,  L.  K.  7  Q.  B.  436,  455; 
Schlesinger  v.  Strattou,  9  li.  I.  578,  .581)  in- 
volved contracts  of  "sale  or  return,"  in  which 
there  was  a  sale  followed  by  a  destruction 
of  the  property  before  the  option  of  the  pur- 
chaser had  expired,  or  had  been  exercised. 
It  was  properly  held  in  these  cases  that  the 
goods  were  at  the  risk  of  the  purchaser  pend- 
ing the  exercise  of  the  option,  and  that  he 
was  responsible  for  the  loss  of  the  goods,  or 
the  price  to  be  paid  therefor.  Thesp  author- 
ities are  not  in  point  in  the  present  case. 

The  contract  under  consideration  did  not 
confer  upon  the  complainant  the  privilege  of 
purchasing  or  returning  the  goods  within  any 
specified  or  reasonable  time,  for  the  defend- 
ants retaineil.  by  express  stipulation,  a  right 
to  share  in  the  profits  made  on  the  sale  of 
the  goods  in  Mexico,  and,  if  they  were  not 
sold,  to  have  the  specific  goods  returned  to 
them  without  expense.  In  the  letter  of  Oc- 
tober 24th,  they  specially  direct  that  the 
Springfield  rifles,  including  those  covered  by 
the  consignment  of  September  18th  as  well 
as  those  covered  by  the  consignment  of  Octo- 
ber 24th,  should  be  returned  if  they  did  not 
realize  the  prices  indicated  in  the  invoices. 

The  conti-act,  in  its  terms  and  conditions,, 
meets  all  the  requirements  of  a  bailment. 
The  recognized  distinction  between  bailment 
and  sale  is  that,  when  the  identical  article 
is  to  be  returned  in  the  same  or  in  some 
altered  form,  the  contract  is  one  of  bail- 
ment, and  the  title  to  the  property  is  not 
changed.  On  the  other  hand,  when  there  is 
no  obligation  to  return  the  specific  article, 
and  the  receiver  is  at  liberty  to  return  an- 
other thing  of  value,  he  becomes  a  debtor 
to  make  the  return,  and  the  title  to  the  prop- 
erty is  changed.  The  transaction  is  a  sale. 
This  distinction  or  test  of  a  bailment  is  rec- 
ognized by  this  court  in  the  case  of  Powder 
Co.  V.  Burkhardt,  97  U.  S.  116. 

The  agency  to  sell  and  return  the  proceeds, 
or  the  specific  goods  if  not  sold,  stands  upon 
precisely  the  same  footing,  and  does  not  in- 
volve a  change  of  title.  An  essential  inci- 
dent to  trust  property  is  that  the  trustee  or 
bailee  can  never  make  use  of  it  for  his  own 
benefit,  nor  can  it  be  subjected  by  his  cred- 
itors to  the  payment  of  his  debts. 

Testing  the  present  case  by  these  estab- 
lished principles,  it  admits  of  no  question 
that  the  contract  was  one  of  bailment,  and 
that  the  title  to  the  goods,  with  the  corre- 
sponding risk  attached  to  ownership,  remain- 
ed with  the  defendants.  Suppose  a  cred- 
itor of  Stm-m  had  levied  upon  or  seized  these 
goods  after  they  reached  his  possession.  It 
cannot  be  doubted  that  the  defendants  could 
have  recovered  them  as  their  property. 

That  the  contract  between  the  parties  in 
reference  to  the  goods  in  (luestion  was  a  bail- 
ment upon  the  t(n-ms  stated  in  the  letters 
is  clearly  established  by  the  authorities. 
Among  others,  see  Hunt  v.  Wyman.  100 
Mass.   198;    Walker  v.  Butter ick,   105  Mass. 


SALE  DISTINGUISITED  FROM  BAILMENT 


21 


2.*:57;  Middloton  v.  Stone,  111  Ta.  St.  5S9,  4 
Atl.  Rop.  r)23. 

Tlie  complainant's  common-law  rosponsi- 
bilily  as  bailee  exempted  him  from  liability 
for  loss  of  the  consigned  goods,  arising  from 
inevitable  accident.  A  bailee  may,  howev- 
er, enlarge  his  legal  responsibility  by  con- 
tract, express  or  fairly  implied,  and  render 
himself  liable  for  the  loss  or  destruction  of 
the  goods  committed  to  his  care;  the  bail- 
ment or  compensation  to  be  received  there- 
for being  a  suHicient  consideration  for  such 
an  undertaking. 

This  brings  us  to  the  question  whether,  by 
the  terms  and  conditions  of  the  contract,  as 
eml)raced  in  the  letter  of  September  ISth, 
consigning  the  goods,  it  can  be  held  that  the 
complainant  assumed  such  a  risk  in  the  pres- 
ent case.  He  assumed  the  expenses  of  trans- 
porting the  goods  to  Mexico,  the  duty  of  sell- 
ing them  to  the  best  advantage  after  they 
reached  there,  the  obligation  to  account  to 
the  defendants  for  the  price  at  which  they 
might  be  sold,  less  one-half  of  the  profits 
in  excess  of  the  invoice  price;  and,  if  not 
sold,  he  was  to  return  the  specific  articles 
to  the  defendants  free  of  expense.  This 
agreement  to  return  the  goods  in  the  event 
they  should  not  be  sold,  it  is  urged,  imposes 
upon  him  the  risk  of  their  destruction  before 
he  had  an  opportunity  to  sell  or  dispose  of 
them  under  or  in  accordance  with  the  terms 
of  the  consignment.  We  cannot  accede  to 
the  correctness  of  this  proposition.  The  de- 
struction of  the  goods,  without  fault  or  neg- 
ligence on  his  part,  terminated  his  obliga- 
tion to  make  either  a  return  thereof,  or  pay 
for  their  loss.  Such  a  liability  could  only  be 
imposed  upon  him  by  a  contract  clearly  ex- 
pressing his  assumption  of  the  risk  of  de- 
struction, or  his  liabilitj'  for  the  loss. 

In  the  ease  of  Himt  v.  \Yymau,  100  Mass. 
lUS,  the  bailee  was  to  return  the  property  (a 
horse)  in  as  good  condition  as  he  received  it, 
by  a  designated  time.  The  property  was  so 
injured,  without  favilt  on  his  part,  that  it 
could  not  be  returned  within  tht?  time  agreed 
upon,  and  no  attempt  was  made  to  return  it. 
Still,  it  was  held  tiiat  he  was  not  responsi- 
ble for  the  property.  The  court  said:  "A 
mere  failure  to  return  the  horse  within  the 
time  agreed  may  be  a  breach  of  contract, 
upon  which  the  plaintiff  is  entiUcd  to  an  ap- 
jjropriate  remedy,  but  has  no  such  legal  ef- 
fect as  to  convert  the  bailment  into  a  sale. 
It  might  be  an  evidence  of  a  determination 
by  the  defendant  of  his  option  to  purchase, 
but  it  would  be  only  evidence.  In  this  case, 
the  accident  to  the  hoi-se,  before  an  oppor- 
tunity \^'as  had  for  trial  in  order  to  deter- 
mine the  option,  deprives  it  of  all  force,  even 
as  evidence." 

In  Walker  v.  Butterick,  lOf)  Mass.  'I'M,  the 
following  contract  was  presented: 

"Boston,  November  25th,  ISGS. 
"Alexander  &  Company,  of  the  first  part, 
are  to  take  goods  from  Walker  &  Company, 


of  the  second  part,  and  to  return  to  them, 
the  said  Walker  &  Company,  everj*  thirty 
days,  the  amount  of  sales,  at  the  i)rice8 
chai-ged  liy  the  said  Walker  &  Company,  who 
will  furnish  Alexander  &  Company  all  g  lods 
in  their  line.  Alexander  &  Company  are 
worth,  in  real  estate  and  money,  $."),0<Kj.  of 
which  they  hereby  certify. 

[Signed]  "Alexander  &  Co. 

"We  agree  to  the  conditions  of  the  within 
instrument. 

[Signed]  "Walker  &  C." 

It  appears  that,  some  months  after  the 
date  of  this  contract,  Alexander  &  Co.  ab- 
sconded, and  one  of  their  creditors  levied 
upon  goods  which  had  been  furnished  by 
Walker  &  Co.  Tlie  court  held  that  the  c(jn- 
tract  under  which  Walker  &  Co.  claimed 
title  to  tlie  goods  levied  upon  importcnl  a  con- 
signment of  the  goiMls  for  sale,  and  not  a 
sale  of  them  by  Walker  &  Co.  to  Alexander 
&  Co.,  so  that  the  title  remained  in  Walker 
&  Co. 

In  Middleton  v.  Stone,  111  Pa.  St.  oS'.*.  4 
Atl.  Rep.  523,  A.  delivered  to  B.  two  colts, 
under  a  contract  that  B.  should  safely  keep 
and  sell  them,  if  possible,  before  a  certain 
date,  for  A., — he  fixing  a  mininuim  price  to 
be  received  by  him,  and  in  addition  there- 
to one-half  of  all  money  obtained  above  that 
price,  to  the  extent  of  i?25,— and,  if  not  sold, 
to  return  the  animals  in  good  condition. 
Held,  that  this  was  not  a  sale,  but  a  bail- 
ment, and  it  was  error,  therefore,  to  over- 
rule the  offer  of  B.  to  show  that  the  colts 
were  sick  when  they  were  delivered  to  him: 
that  one  of  them  died;  and  that  he  then  of- 
fered to  return  the  other  to  A.,  who  n-^fused 
to  receive  it.  It  was  held  that  the  horses 
were  at  the  risk  of  A. 

It  is  next  urged,  on  behalf  of  the  defend- 
ants, that  the  taking  of  the  insurance  in  the 
name  of  complainant  was  a  recognition  of 
his  responsibility  for  the  loss  of  the  goods, 
and  that  the  policies  of  insiu-ance  were  turn- 
ed over  to  them  to  secure  this  liability  of 
the  complainant.  This  position  cannot  be 
sustained,  for  the  reason  that  defendants, 
tlirough  their  partner,  Funke,  directed  that 
all  the  insurance  should  be  taken  out  to- 
gether in  the  name  of  Sturm,  and  also  in- 
structed the  insurance  broker  to  select  f.>r 
them  the  policies  which  they  wisluxl  appro- 
priated to  secure  their  interest.  The  act  of 
taking  out  the  insurance,  in  the  manner  in 
which  it  Avas  done,  was  their  act.  as  much 
as  it  was  the  act  of  Sturm;  and  the  insur- 
ance having  been  thus  effected  in  no  way 
tends  to  establish  the  contention  that  it  war^ 
a  recognition  of  Sturm's  liability  for  the  los.s 
of  the  goods. 

It  is  not  material  to  determine  whether  the 
complainant  ever  indorsed  and  transfen-ed 
these  four  policies  to  the  defendants,  or.  if  so. 
whether  it  was  dcme  at  tlie  time  of  their  de- 
livery,  or  subseciuently,  for  no  such  assign- 


22 


SALE  DISTINGUISHED  FROM   BAILMENT. 


mont  or  transfer  thereof  was  necessary  to 
have  I'liabh'd  the  defendauts  to  recover  on  the 
policies  for  the  loss  of  cargo,  to  the  extent  of 
their  interest  in  the  same;  it  being  well  set- 
tled that  under  a  policy  running  to  Sturm, 
"for  account  of  whom  it  might  concern," 
the  defendants  could  show  and  recover  their 
interest,  in  the  event  of  loss.  It  was  so  ruled 
by  this  court  in  Hooper  v.  Robinson,  98  U. 
S.  r)28,  where  it  was  said  "that  a  policy  up- 
on a  cargo  in  the  name  of  A.,  'on  account  of 
whom  it  may  concern,'  or  with  other  e(iuiva- 
lent  terms,  will  inure  to  the  interests  of  the 
party  for  whom  it  was  intended  by  A.,  pro- 
vided he,  at  the  time  of  effecting  the  insur- 
ance, had  tlie  requisite  authority  from  such 
party,  or  the  latter  subsequently  adopted  it." 

In  the  present  ease,  Sturm  had  the  requi- 
site authority  of  the  defendants  to  make  the 
insurance  on  the  consigned  goods,  as  was  tes- 
tified to  by  the  insurance  broker,  and  as 
shown  in  their  letter  of  September  18,  1867, 
in  which  thej'  say:  "As  you  have  insured 
these  goods,  as  weU  as  other  merchandise, 
we  should  be  pleased  to  have  the  amount  of 
$40,000  transferred  to  us."  It  is  clear  that 
the  insurance,  to  the  extent  of  $40,000,  was 
intended  to  cover  the  interests  of  the  defend- 
ants in  the  consignment  of  September  18, 
1807;  and,  in  tlie  absence  of  any  delivery 
or  tran.sfer  of  policies  representing  that  in- 
terest, this  could  have  been  shown  by  them, 
so  a.s  to  entitle  them  to  the  benefits  of  such 
insurance. 

It  is  next  urged — and  the  court  below  seems 
to  have  taken  the  same  view  of  the  matter- 
that  the  complainant  is  estopped  from  deny- 
ing his  responsibility  for  the  loss  of  the 
goods  because  of  alleged  statements  made  by 
him  as  a  witness  in  the  suits  upon  the  insur- 
ance poUcies.  It  is  claimed  that  in  those 
suits  he  testified  under  oath  that  he  wa.s  the 
owner  of  the  goods,  and  thereby  precluded 
himself  from  asserting  anything  to  the  con- 
trary in  this  case,  under  the  wise  and  salu- 
taiy  doctrine  which  binds  a  party  to  his  ju- 
dicial declarations,  and  forbids  him  from 
subsequently  contradicting  his  statements 
thus  made.  We  do  not  controvert  the  sound- 
ness of  this  general  rule,  as  laid  down  in 
the  cases  cited  by  the  defendants.  Dent  v. 
Ferguson,  132  U.  S.  50,  10  Sup.  Ct.  Rep.  1-3; 
Creath's  Adm'r  v.  Sims,  5  How.  192;  Wheel- 
er v.  Sage,  1  Wall.  518;  Seltz  v.  Unnn,  C. 
Wall.  .327;  Kitchen  v.  Rayl)urn,  19  Wall. 
2.54;  Bartle  v.  Coleman,  4  Pet.  184;  Sample 
V.  Barnes,  14  How.  70;  Hannauer  v.  Wood- 
ruff, 15  Wall.  4:59;  Higgins  v.  McCrea,  116 
U.  S.  671.  6  Sup.  Ct.  Rep.  557;  Cragin  v. 
Powell,  128  U.  S.  091,  9  Sup.  Ct.  R-p.  203; 
Prince  Manuf'g  Co.  v.  Prince's  Metallic  Paint 
Co..  135  N.  Y.  24,  31  N.  E.  Rep.  990;  Ste- 
phens V.  Robinson,  2  Cromp.  &  J.  209;  Har- 
mer  v.  Westmacott,  6  Sim.  284;  De  Metton 
V.  De  Me'lo,  12  East,  234;  Post  v.  Marsh,  10 
Ch.  Div.  395;  In  re  Great  Berlin  Steamboat 
Co.,  26  Ch.  Div.  616.    But  the  question  here 


is  whether  the  statements  made  by  the  com- 
plainant in  the  insurance  suits  bring  him 
within  the  operation  of  this  w'holesome  rule. 
We  think  not,  for  it  would  be  pi-essing  his 
language  to.)  far  to  hold  that  he  made  any 
positive'  statement  to  the  effect  that  he  was 
tlie  absolute  owner  of  the  goods,  or  that  he 
admitted  as  a  matter  of  fact,  rather  than  of 
opinion,  that  he  was  responsible  for  their 
loss.  What  he  did  state,  when  his  testimony 
is  read  as  a  whole,  was  that  he  was  the  own- 
er on  consignment,  for  when  the  direct  ques- 
tion Avas  put  to  him,  "What  do  you  mean  by 
being  the  owner  for  the  time  being?"  his 
reply  was:  "That  they  were  delivered  to  me 
by  Hermann  Boker  &  Co.  under  that  agree- 
ment, and  I  was  responsible  for  those  goods 
until  they  were  returned,  or  until  I  deliv- 
ered the  money  to  them.  This  is  what  I 
mean."  And,  in  reply  to  another  question, 
he  stated  that  "the  terms  on  which  I  was  the 
owner  were  expressed  in  the  papers  I  fui'- 
nislied,"  referring  to  the  letters  of  September 
18  and  October  24,  1867.  And  to  the  further 
question  whether  he  unilerstood  that  those 
contracts  made  the  goods  his  property,  hi& 
answer  was,  "I  understood  so  at  the  time, 
certainly,  and  I  believe  so  yet." 

This  language  did  not  mislead  or  induce 
either  the  defendants  or  the  insiu'ance  com- 
panies to  alter  or  change  their  position  in  any 
respect  whatever,  nor  influence  their  conduct 
in  any  way.  Both  the  defendants  and  the 
iiusm'ance  companies  had  the  written  con- 
tracts before  them,  and  were  presumed,  as  a 
matter  of  law,  to  know  their  legal  effect  and 
operation.  What  the  complainant  said  in  his 
testimony  was  a  statement  of  opinion  upon 
a  question  of  law,  where  the  facts  were 
equally  well  known  to  both  parties.  Such 
statements  of  opinion  do  not  operate  as  an 
estoppel.  If  he  had  said,  in  express  terms, 
that  by  that  conti'act  he  was  responsilde  for 
the  loss,  it  would  have  been,  under  the  cir- 
cumstances, only  the  expression  of  an  opinion 
as  to  the  law  of  the  contract,  and  not  a  dec- 
laration or  admission  of  a  fact,  such  as  would 
estop  him  from  subsequently  taking  a  differ- 
ent position  as  to  the  true  interpretation  of 
the  written  instrument. 

In  Brant  v.  Iron  Co.,  93  U.  S.  326,  it  was  sad: 
"Where  the  condition  of  the  title  is  known 
to  both  p:u"ties,  or  both  have  the  same  means 
of  ascertaining  the  truth,  there  can  be  no 
equitable  estoppel." 

So  in  Brewster  v.  Striker,  2  N.  Y.  19,  and 
Norton  v.  Coons,  6  N.  Y.  33,  and  approved  in 
Chatfield  v.  Simonson,  92  N.  Y.  218,  where  it 
was  ruled  "that  the  assertion  of  a  legal  con- 
clusion, where  the  facts  were  all  stated,  did 
not  operate  as  an  estoppel  iipon  the  party 
making  such  assertion." 

In  Bigelow,  Estop.  (5th  Ed.)  §  2,  p.  573.  it 
is  properly  said:  "The  rule  we  apprehend  to 
be  this:  That  where  the  statement  or  con- 
duct is  not  resolvable  into  a  statement  of 
fact,  as  distinguished   from  a  statement  of 


SALE   DISTINGUISHED  FROM   HAIL.MK.NT 


23 


opinion  or  of  law,  and  does  not  amount  to 
a  contract,  tlio  party  making  it  is  not  bound, 
unless  he  was  j?uilty  of  dear  moral  fraud, 
or  unless  he  stotxl  in  a  relation  of  conlidence 
towards  him  to  whom  it  Avas  made.  If  the 
stat(»ment,  not  being  contracted  to  be  true, 
is  und(;rsto(Kl  to  be  opinion,  or  a  conclusion 
of  law,  from  a  comparison  of  facts,  proposi- 
tions, or  the  like,  and  a  fortiori  if  it  is  the 
declaration  of  a  supposed  rule  of  law,  the 
l)arties  may,  with  the  (lualilic'ation  stated  in 
the  last  sentence,  allege  its  incorrectness." 
And  again,  (section  2,  p.  571:)  "A  representa- 
tion in  pais,  in  writing,  when  not  a  part  of 
a  deed,  or  made  the  subject  of  a  contract, 
though  on  oath,  is  no  more  efficacious,  so  far 
UiS  the  question  of  estoppel  is  concerned,  than 
a  verbal  statement." 

These  authorities  lay  down  the  correct  rule 
to  be  applied  in  the  present  case,  and,  tested 
by  the  principle  they  announce,  the  com- 
plainant is  not  estopped  from  claiming  his 
rights  under  a  proper  construction  of  the  con- 
tract, notwithstanding  what  he  said  in  the 
insiu-ance  cases. 

The  grounds  of  estoppel  against  the  com- 
plainant are  not  nearly  so  strong  as  tliey  are 
against  the  defendants.  It  is  clearly  shown 
that  Funke,  a  member  of  defendants'  firm, 
in  March,  187G,  on  the  trial  of  the  suit  against 
the  New  York  Mutual  Insm'ance  Company 
upon  one  of  the  policies  in  question,  distinct- 
ly swore  that  the  complainant  was  indebted 
to  them  only  to  the  extent  of  $32,000,  and 
that  they  had  no  security  whatever  for  the 
payment  of  that  indebtedness.  In  his  testi- 
mony in  the  present  case,  he  fails  to  explain 
that  sworn  statement.  That  sworn  staten.ent 
is  inconsistent  with  the  claim  now  made,— 
that  the  complainant  was  at  that  time  in- 
debted to  the  defendants  to  the  amoimt  of 
over  $140,000,— and  it  is  furthermore  incon- 
sistent with  the  position  now  taken,— that 
they  held  all  tiie  insurance  policies,  amount- 
ing to  $1G;>,000.  as  collateral  security  for 
complainant's  indebtedness.  These  sworn 
statements  of  Funke  related  to  facts  which 
were  as  well,  if  not  better,  known  to  the 
witness  at  that  time  than  in  1SS2,  and  subse- 
quently, when  he  testitied  in  this  case. 
TTiose  statements  are  unexplained,  and  if 
they  do  not  operate  as  an  estoppel  upon  the 
defendants  from  now  claiming  a  larger  in- 
debtedness than  was  then  stated,  and  from 
claiming  that  all  the  policies  were  turned 
over  to  them  as  collateral  security,  they  cer- 
tainly cast  suspicion  and  discrt'dit  upon  their 
testimony  in  the  present  case.  The  question 
of  estoppel  need  not  be  fiu-ther  discussed. 

Upon  the  written  contract,  and  all  the  rel- 
evant and  competent  evidence  connected 
therewith,  we  are  of  opinion  that  the  con- 
struction which  the  lower  com't  placed  upon 
the  contract  was  incoiTect;  that  the  com- 
plainant was  not  an  insurer  of  the  goods; 
that  he  was  not  responsible  for  their  lo.ss; 
that  the  policy  of  $1.5.000  on  the  cargo  of  the 
Blonde,  turned  over  to  the  defendants,  was 


intended  to  cover  tlieir  interest  in  that  con- 
signment, amounting  to  $10,."itjO,  and  that  the 
four  policies  on  flie  Kcese's  cargo,  delivered 
to  them,  were  to  jjrotect  tlieir  inie.-est  in  the 
consigned  goods  eai-riisl  by  that  vessel,  to  the 
extent  of  $2!»,;527;  that  they  held  these  poli- 
cies to  pay  tliat  amount  in  case  of  loss,  and 
that  the  surplus,  if  any,  was  to  Ix-  held  in 
trust  for  the  complainant.  But  if  there  wen- 
any  doubt  on  this  question  Exhibits  H  and 
F,  which  were  produced  by  the  comi)laiiiant 
during  the  progre.ss  of  the  suit,  i)lac<'  the 
matter  beyond  all  dispute.  Said  exhibits  are 
a.s  follows: 

"Exhibit  H. 

"New  York,  October  11th,  1807. 
"Memorandum. 

"We  have  received  from  John.son  &  Ilig- 
gins  $103,000  policies  on  the  schooner  Keese, 
and  $30,000  on  the  brig  Blonde,  as  per  state- 
ment attached.  We  directed  them  to  insure 
our  goods  for  $40, WO,  which  covers  our  bill 
of  Septend)er  18th,  and  premium,  but  no 
profit.  To  enable  us  to  sel(H.-t  our  policies, 
Genei-al  Sturm  has  indorsed  in  blank  five 
policies,  amounting  to  $70,000,  as  follows: 

On  Keese,  the  Orient  Mutual,  $1.".000, 
and  New  York  Miitual.  .S12..'ion;  Sun 
JNIutual,  $12,.j00,  and  Mercantile  .Mutual. 
$lo,0(X). 

On  Blonde,  the  United  States  Lloyds 
policy  for  $l.j,000,  which  we  have  taken 
as  ours.     Leaving  a  balance  for  us  to 
select  on  Keese  of  $2.">,()i><),  of  which  we 
have  so   far  selected   only   the   Orient, 
and,  as  we  cannot  divide  the  policies 
to  suit  us,  we  hereby  agi'ee  this  day  to 
j  keej)  all  the  fom-  policies  on  the  Keese 
g       for  the  joint  acc(mnt  of  om'selves  and 
-^       General  H.  Sturm,  and.  in  case  of  any 
§   j  accident   or    loss,    we    will    collect    the 
amount  of  the  policies  from  the  com- 
panies, and  pay  over  to  General  Sturm 
his    share,     viz.     30-.J.')    of    the     whole 
amoimt    collected;  and    Ave    also    agree 
to  paj'  the  premium  notes  for  our  share 
of  the  policies,  and   to  stand   all  loss, 
if    any    should    happen    to    our    goods. 
General  Sturm  is  to  bear  the  shipping 
expenses,  only,  and   in  no  event   shall 
he  be  held  responsible  for  any  accident 
or  damage,  or  any  act  of  the  Mexie.in 
government;  but  in  case  he  cannot  sell 
the  arms  at  the  price  agreed  upon,  and 
has    to    return    them,    he    shall    insure 
I  them  for  our  account. 
"The   foregoing   is   hereby    fully   approved 
and  agreed  to.  Hermann  Boker  &  Co." 

"Exhibit  F. 

"Memoranduin.  We  have  insured  our 
goods  on  tlie  Keese  and  Blonde  for  a  maxi- 
mum of  $40,000,  which  includes  the  pre- 
mium, which  we  have  to  pay.  In  case  of 
accident,  we  select  ovu-  policies,  and  we 
stand  all  loss,  and  Gl.  Stm-m  pftTS  sMnpt"" 


SALE   DISTIXcniSlIEl)   FKOM    BAIL^EENT. 


expousi'S.  only.  We  hold  iu  trust  for  (Ji'iil. 
Sturii]  .$;i(),(KK)  policies  on  the  Keose,  and  also 
a  package  of  ^Mexican  bonds  left  over  from 
the  $10r),000  delivered  to  us  Septbr.  2()tli. 
We  also  now  direct  Gl.  Sturm  to  dispose  of 
the  batteries  at  any  price. 
'•Steamer  Wilniinjrton,  October  2."),  '07. 

"Hermann  Bolcer  «&  Co." 

Tliese  exhibits  were  vigorously  attacked  by 
the  defendants,  w'ho  at  first  claimed  that 
botli  the  body  and  signatiu'es  of  the  docu- 
ments were  forgeries.  Tliey  afterwards  ad- 
mitted that  the  signatures  were  genuine, 
but  insisted  that  the  writing  above  them  was 
lV)rged.  A  great  deal  of  proof  was  taken 
to  establish  this  contention,  but  it  fails,  in 
om-  opinion,  to  show  that  these  documents 
were  forgeries.  The  signatures  being  gen- 
uine, the  burden  of  proof  was  clearly  upon 
the  defendants  to  estabhsh  that  the  written 
part  above  the  signatures  was  forged.  The 
d(>lay  in  the  pi'oduction  of  these  documents 
is  fairly  accounted  for  by  the  complainant, 
and  they  are  in  harmony  with  what,  we 
tliink,  was  the  true  nature  and  character  of 
the  contract  and  agreement  of  the  parties. 

Some  reliance  is  i)laced  upon  what  is  called 
a  statement  of  his  accoimt  made  to  Sturm 
in  Indianapolis  in  May,  IST.j.  by  Boker-,  »me 
of  defendants'  firm.  This  account  was  clear- 
ly a  partial  one.  It  was  made  up  by  Rabing, 
the  bookkeeper  of  defendants,  —  not  from 
their  books,  but  from  memoranda  furnished 
him  by  Boker,— but  from  what  source  he  ob- 
tained it  does  not  appear.  The  correctness 
of  the  account— shown  by  loose  slips  of  pa- 
per and  imperfect  memoranda— was  dis- 
puted by  Sturm,  and  it  is  now  conceded  by 
defendants  that  it  was  not  a  full  and  ac- 
curate statement.  Sturm  claimed  that  they 
had  not  given  him  credit  for  money  collected 
on  his  insurance  policies,  and  that  when 
they  were  all  included  the  defendants  would 
be  indebted  to  him.  The  circumstances  at- 
tending the  presentation  of  this  account, 
made  at  a  time  when  Sturm  was  contem- 
plating going  into  bankruptcy,  tends  strongly 
to  show  that  the  defendants  were  endeavor- 
ing to  induce  him  to  admit  a  much  larger 
indebtedness  to  them  than  really  existed. 
in  order  to  give  them  an  advantage  in  the 
event  of  bankruptcy.  But,  however  that 
may  l)e,  there  was  no  stated  account  ac- 
cei)ti'd  or  acquiesced  iu  by  Sturm,  such  as 
would  either  conclude  or  require  him  to  stu-- 
charge  and  falsify  the  same. 

We  have  not  deenunl  it  necessaiy  to  de- 
termine whether  the  September  invoice  had 
on  it  the  printed   words  "Payable  in  Gold" 


when  it  was  delivered.  Those  words  form 
no  part  of  the  contract,  as  en)bodied  in  the 
letter  of  September  IS,  ISi'.T,  and  complain- 
ant's acceptance  therc^of.  They  do  not  im- 
pose upon  the  complainant  the  liability  to 
account  for  the  value  of  the  goods,  in  gold, 
in  the  event  of  loss  by  inevitable  accident; 
and  not  being  resi)onsible  for  the  goods,  nor 
liable  for  the  loss  thereof,  neither  he,  nor  the 
jjroceeds  of  his  insurance  policies,  can  prop- 
erly be  sul)jected  tO'  the  burden  of  making 
good  either  the  defendants'  loss,  or  paying 
such  losses  in  gold.  The  insurance,  as  de- 
fendants admit,  was  not  on  a  gold  basis, 
but  only  for  the  invoice  price  of  the  goods 
in  cmTency.  The  complainant  was  not  an 
insurer,  nor  in  any  way  liable  for  even  the 
currency  value  of  the  consigned  goods,  and 
it  would  be  a  perversion  of  the  contract,  and 
inequitable,  to  require  either  him  or  his  pol- 
icies to  compensate  the  defendants  for  their 
loss  in  gold. 

We  think  the  complainant  has  failed  to 
make  out  a  claim  to  compensation  for  his 
services  in  attending  to  the  suits  against  the 
insm-ance  companies. 

In  our  opinion  the  complainant  is  entitled 
to  the  account  he  seeks  by  his  bill,  in  which 
he  should  be  credited  with  the  amounts  re- 
ceived by  the  defendants  on  the  insurance 
policies  in  the  proportion  of  $1."'/2,2GG  to  $29,- 
327,  that  being  their  relative  interest  in  the 
cargo  of  the  Keese;  that  the  expenses  of 
the  litigation,  including  counsel  fees,  shoiild 
be  divided  between  the  parties  on  the  same 
basis;  that  the  complainant  is  entitled  to 
one-half  of  the  sum  of  .$l,4ij3.84.  paid  by  way 
of  general  average  on  the  goods  shippfMl  on 
the  Blonde;  to  the  further  sura  of  $072.08, 
for  r(>pairing  the  goods  w^hich  reached  Mex- 
ico in  a  damaged  condition;  and  for  what- 
ever defendants  realized  on  complainant's 
life  insurance  policies,  and  on.  the  notes  aris- 
ing from  the  sale  of  the  Indianapolis  lots,  if 
the  amount  so  realized  did  not  have  to  be 
repaid  in  taking  up  the  notes;  and  with  such 
other  amounts  as  he  may  have  placed  in 
the  hands  of  the  defendants,  either  in  the 
bank  account  or  in  the  transaction  connected 
with  the  insurance  policies;  and  the  defend- 
ants will  be  credited  with  all  the  amoimts 
paid  to  and  for  the  account  of  complainant 
not  covered  by  the  foregoing  rulings.  The 
account  will  be  stated  up  to  the  filing  of  the 
bill,  and  any  balance  shown  in  favor  of 
either  side  will  bear  interest  from  that  date. 

The  decree  is  reversed,  and  the  cause  is 
remanded  to  the  court  below,  to  be  proceed- 
ed with  in  conformity  with  this  opinion. 

So  ordered. 


SALE  DISTINGUISHED  FROM  BAILMENT. 


26 


<"IJOSBY  et  al.  v.  DELAWAItE  &  II.  CANAL 
CO. 

(23  N.  E.  736,  119  N.  Y.  ;«4.t 

Totirt  of  Appeals  of  New  York.      Eeh.  2."».  ISOO. 

Appeal  from  supreme  court,  general 
term,  third  department. 

.\ftion  ))y  Abel  A.  Crosby  and  others 
!i;iainst  tlie  prewident,  manaj^'er.  and  coui- 
l^any  of  the  Delaware  &  llud.sc>n  Canal 
Company,  for  conversion  of  lumber.  The 
lumber  had  been  ordered  from  defendant 
by  the  firm  of  <;.  &  E.  Harnden.  who  had 
a  rontrart  to  build  boats  for  defendant, 
and  this  firm  thereafter  executed  a  bill  of 
sale  of  the  lumber  to  plaintiffs  in  consider- 
ation of  an  indebtedne.ss  to  them.  Delend- 
ant  afterwards  took  the  lumber.  A  juaj?- 
ment  for  plaintiffs  was  reversed  by  the 
general  term,  and  a  new  trial  ordered,  (40 
Hun,  G37,  mem.,)  and  on  the  new  trial  the 
complaint  was  dismissed.  The  judgment 
of  dismissal  was  affirmed  at  general  term, 
an<l  plaintiffs  appeal. 

Lnwtou  &  Stehhins,  (S.  L.  Stebbins,  of 
counsel, J  for  appellants.  F.  L.  Westbvook, 
for  respondent. 

.ANDREWS,.!.  The  transaction  between 
the  defendant  and  the  Hamdenswas  either 
a  liailment  of  the  lumber  or  a  sale.  Re- 
garding it  as  a  bailment,  it  was  a  bail- 
ment to  be  transmuted  into  a  sale  when 
the  Harndens  shouhl  use  the  lumber  in 
building  the  boats,  and  thereby  incorpo- 
rate it  with  otlier  hnnber  and  materials 
required  in  their  construction.  It  was 
not  c«mtemplated  that  the  title  to  the 
boats  should  vest  in  the  defendant  until 
■comj)letion  and  acceptance.  The  consent 
of  the  defendant  that  the  Harndens  might 
use  the  lumber  in  the  construction  of  the 
boats  must  be  conceded.  The  bailment 
would  necessarily  terminate,  and  the  title 
to  the  lumber  would,  hy  oi)eration  of  law, 
A'est  in  the  Harndens,  when  it  l)ecame  by 
tlie  consent  of  the  defendant  mingled 
with  the  lumber  and  materials  of  the 
Harndens  in  the  process  of  constructing 
the  boats.  If,  after  the  boats  had  been 
constructed,  the  Harndens  had  refused  to 
perform  their  contract,  or  to  deliver  the 
boats  to  the  defendant,  the  latter  could 
not  have  asserted  title  to  them  on  the 
ground  that  the  lumber  furnished  by  the 
<ro!ii])aiiy  went  into  their  construction. 
The  Harndens  would  in  the  case  supy>osed 
be  lial)le  for  the  value  of  the  lumber  as 
ujion  a  purchase  and  sale,  and  possibly 
the  defendant  might  enft>rce  a  lien  on  the 
boats  to  the  extent  of  such  value,  in  view 
of  the  circumstances.  There  was  no  ob- 
jection in  law  to  an  arrangement  between 
the  defenrlant  and  the  Harndens  that,  un- 
til the  lumber  was  actually  used  for  the 
purpose  intended,  the  title  should  remain 
in  the  defendant.  The  point  is  whether 
the  evidence  conclusively  establishes  this 
to  have  been  the  arrangement,  or  could 
the  jur3-  have  been  permitted,  if  the  case 
had  been  submitted  to  them,  to  find  that 
the  t  ransaction  at  the  outset  was  a  sale  to 
the  Harndens.  The  contract  for  the  boats 
was  made  November  8,  1882,  by  the  accept- 
ance by  the  Harndens  of  a  written  prop 


osition  of  the  defendant  that  if  they 
would  build  two  boats  during  the  folhjw- 
ing  winter,  for  delivery  in  the  spring, "the 
company  will  lake  them  at  twelve  hun- 
dred dollars,  ($l,20(j,)  subject  to  insp(*tion 
and  approval  by  the  company  inspwtor.  " 
The  lumber  in  question  was  (ordered  by  the 
Harndens  of  the  defendant's  agent,  No- 
vember 21,  l^*x2,  and  was  delivered  on  or 
about  the  24th.  The  conti-act  for  building 
the  boats  did  not  reijuire  the  defendant  to 
furnish  any  of  the  lumber,  nor  did  it  re- 
quire the  Harndens  to  procure  any  from 
the  defendant.  The  order  for  the  lumber 
specified  kinds  and  quantities,  but  no 
prices.  The  defendant's  agent,  on  for- 
warding the  lumber,  sent  a  bill  fcjr  the 
lumber,  commencing.  "  Messrs.  O.  &  E. 
Harnden,  to  the  Delaware  &  Huds<ju  Ca- 
nal Co.,  Dr.;"  and  this  is  followed  by  a 
specification  of  the  quantity,  kind,  and 
jjrice  of  each  desciiption  of  lumber  sent, 
the  prices  aggregating  $412.77.  The  bill 
was  partly  written  and  partly  printed,  the 
ordinary  bill-head  of  the  cfjinpany  being 
used,  and  the  wcjrds.  "to  the  Delawai-c  & 
Hudson  Canal  Co..  Dr.,"  were  printerl.  It 
does  not  appear  that  there  were  any  ne- 
gotiations between  the  parties  jjrior  to 
the  delivery  of  the  lumber,  as  to  the  terms 
and  conditions  on  which  it  was  to  be  fur- 
nished. The  defendant,  however,  gave 
evidence  showing  that  it  kept  c)n  hand 
pine  lumber  for  building  boats,  including 
j)ieL-es  specially  shaped,  which  it  used  in 
l)uilding  boats  at  its  own  yards,  and  also 
furnished  to  boat-builders  having  c(jn- 
tracts  to  build  boats  for  the  defendant, 
but  it  was  furnished  to  third  persons  <<nly 
for  the  purpose  of  having  the  same  used  in 
such  boats,  and  that  the  value  (jf  the  lum- 
ber furnished  was  deducted  fnjm  the  i)rite 
of  the  boat,  and  that  this  custom  was 
known  to  the  Harndens.  The  bill  of  items 
is  some  evidence  that  the  transaction  was 
understood  as  a  sale,  although  not  con- 
clusive. Whether  a  sale  or  a  bailment,  in 
either  case  the  sum  to  be  charged  for  the 
lumber  was  a  matter  in  which  both  the 
Harndens  and  the  ctmipany  were  interest- 
ed. The  custom  of  the  defendant  to  sup- 
ply lumber  only  for  use  in  its  boats,  and 
to  take  the  value  out  of  the  |)rice  of  the 
boat,  does  not  seem  necessarily  inconsist- 
ent with  a  sale.  The  Harndens  testitied 
that  formerly  they  paid  cash  on  delivery 
of  lumber  furnished  by  the  defendant  for 
boats  which  they  built  for  the  company, 
and  that  later  the  custom  was  to  ded\ict 
the  value  of  lumber  so  furnished  fnmi  the 
price  to  be  paid  for  the  boat  when  com- 
pleted, on  delivery.  It  is  insisted  by  the 
counsel  for  the  plaintiffs  that  the  jury 
might  have  found  that  the  change  was 
made  from  cash  to  credit  sales,  the  credit 
extending  to  the  time  when  by  the  con- 
tract the  boat  was  to  be  completed.  We 
think  it  would  not  be  u.seful  to  go  further 
into  the  details  of  the  evidence.  There 
seems  to  be  but  little  equity  in  the  claim 
of  the  plaintiffs  to  have  thelumber  applied 
on  their  debt.  Rut  we  think  the  question 
whether  there  wasa  bailment  ora  sale  was 
for  the  jury.  Thejudgment  should  therefore 
be  reversed,  and  a  new  trial  ordered.  All 
concur, except  PECKH.VM,  J.,  not  sitting. 


26 


SALE  DISTINGUISHED  FROM    BAILMENT. 


JONES  V.  KEMP. 

(12  N.  W.  S90,  49  Mich.  9.) 
Supreme  Court  of  Michi^ifan.      June  21,  1SS2. 
Error  to  Kent. 

Blair,  Kingsloy  &  Kleiuhaus,  for  appellant. 
Frank  (J.  Holmes,  for  appellee. 

CAMl'BELL,  J.  This  was  an  action  on  the 
ease,  for  fraud  in  the  purchase  of  wheat.  The 
(leclaratiun  contains  three  counts,  all  of  which 
under  various  forms  set  out  tliiit  defendant  by 
false  representations  as  to  his  credit  procured 
plaintiff  to  sell  and  deliver  certain  wheat  to 
him.  The  facts  found  by  the  amended  finding 
are  that  in  October,  1875,  an  arrangement  was 
made  whereby  plaintiff  was  to  dehver  to  de- 
fendant, who  was  a  miller,  4.j0  bushels  of 
wheat,  to  be  paid  for  o-i  delivery  or  at  any 
subsequent  time  when  plaintiff  demanded  pay- 
ment, at  the  (Jrand  Rapids  price  current  at  the 
time  of  demand.  It  was  understood  that  de- 
fendant might— as  he  did— use  the  wheat  in  his 
milling  business  to  mix  with  other  wheat  of 
a  different  character  for  innnediate  grinding. 
In  .Tune,  1876,  plaintiff  demanded  his  pay  at 
the  current  rates,  and  was  mduced  to  take  a 
bank  check  at  10  da^^s,  by  representations  of 
solvency  and  prompt  payment.  In  that  in- 
terim defendant  stopped  business  and  made  an 


assignment,  having  been  insolvent,  for  some  pe- 
riod not  named,  but  earlier  than  June  1st. 
The  court  on  this  held  the  deposit  a  bailment 
and  the  transaction  of  June  1st  the  only  .sale, 
and  gave  judgment  for  plaintiff. 

We  think  this  was  erroneous,  'ihe  plaintiff 
n^served  no  right  lo  /e<'all  his  wheat  or  any 
wheat  or  flour  in  its  place.  Defendant  re- 
served no  right  to  return  it  actually  or  in  kind. 
He  was  bound  at  all  events  to  keep  it,  and  to 
pay  for  it  on  demand,  while  the  money  was 
payable  without  contingency.  This  was  a  sale 
and  delivery  at  once,  and  witliout  any  credit 
on  which  defendant  could  rely.  He  was  bound 
to  have  his  money  always  ready,  and  to  paj- 
when  called  on.  There  was  no  fraud  shown  in 
tlie  original  dealings.  If  any  fraud  was  com- 
mitted at  al'  it  was  in  getting  an  extension  of 
time  on  a  matured  debt.  This  is  not  the  fraud 
charged.  Had  defendant  refused  on  the  first 
of  June  to  make  payment.  plaintift"s  only  rem- 
edy would  have  been  by  action  for  the  price. 
He  could  not  have  reclaimed  the  property. 

The  action  thei-efore  was  misapprehended. 
Judgment  must  be  reversed,  and  judgment  en- 
tered for  defendant  on  the  finding,  with  costs 
of  both  courts. 

GRA\ES.  C.  J.,  and  COOLEY,  .1.,  concurred. 

INIARSTON,  J.,  did  not  sit  in  this  case. 


INTANTS. 


27 


WELCH  V.  OLMSTEAD. 

(51  N.  W.  541,  90  Mich.  492.) 

Supreme  Court  of  Michigan.      March  4.   1S1»2. 

Error  to  circuit  court,  Ionia  county;  Ver- 
non H.  Smith,  Judge. 

Tills  was  an  action  brought  by  Burt  ^^'elc•h. 
an  infant,  by  Charles  Burhans,  his  next 
friend,  against  Melvin  Olmslead,  to  I'oeover 
for  work  done.  From  a  judgment  for  plain- 
tiff, defendant  appeals.     Affirmed. 

A.  A.  Ellis  and  F.  C.  Miller,  for  appellant. 
Davis  &  Nichols,  for  appellee. 

MONTGOMERY,  .J.  The  plaintiff  recov- 
ered below  for  work  and  labor  performed  for 
the  defendant  as  a  farm  hand  at  the  rate 
of  ."?12  per  month.  AVhile  it  is  suggested 
here  that  the  court  erred  in  instructing  the 
jury  that  the  rate  was  fixed  at  ^12  per 
month,  and  it  is  claimed  that  the  bargain 
was  conditional  on  the  plaintiff's  being  able 
to  earn  that  amount,  yet,  as  the  defendant 
in  his  plea  set  out  the  contract  as  a  positive 
one  to  pay  .$12  per  month,  and  as  he  subse- 
quently tendered  the  plaintiff  payment  at 
that  i-ate,  we  think  the  instiaiction  was  cor- 
rect. The  real  question  involved  is  whether 
the  defendant  was  entitled  to  set  off  against 
the  claim  of  the  infant  plaintiff"  the  purchase 
price  of  a  watch  and  chain  sold  him  while 
he  was  in  his  employ.  The  price  of  the 
watch  and  chain  agreed  on  was  !?20.  There 
was  evidence  tending  to  show  that  it  was  not 
worth  more  than  .$10  to  .$12,  while  the  testi- 
mony offered  on  behalf  of  the  defendant 
showed  that  when  new  the  watch  would  be 
worth  .$14  to  $15,  and  the  chain  about  $4. 
There  was  also  evidence  that  the  defendant 
and  liis  brother  were  constantly  praising  the 
watch  to  the  plaintiff",  and  that  it  was  as  a 
resiilt  of  this  persuasion  that  he  made  the 
purchase.  The  plaintiff,  after  keeping  the 
watch  for  some  time,  tendered  it  back  to  the 
defendant,  and  when  he  quit  the  defendant's 
service  left  the  watch  with  him.  The  cii'- 
cuit  judge  also  charged  the  juiy  as  follows: 
"It  has,  we  believe,  always  been  held  that 
the  minor  might  bind  himself  by  contract 
for  necessaries,  and  that  such  contract,  when 
executed,  when  completed,  if  reasonable  \in- 


der  the  circumstances,  or  not  so  unreasona- 
ble as  to  be  evidence  of  fraud  or  undue  ad- 
vantage, cannot  be  repudiated  by  him.  Now, 
there  is  no  presumption  that  any  one  acts 
fraudulently  towards  a  minor.  It  cannot  be 
said  that  Olmstead  committed  a  fraud  in  sell- 
ing a  watch,  without  evidence;  and  whether 
everything  was  fair,  or  whether  he  commit- 
ted any  fraud  or  deception,  is  for  the  jury  to 
saj-;  it  cannot  be  presumed  without  evidence. 
The  party  that  comes  into  a  case,  and  .says 
that  a  fraud  has  been  perpetrated,  or  undue 
advantage  taken,  or  deception  practiced, 
must  produce  evidence  to  sustain  that  point. 
Thex'e  is  no  presumption  of  fraud;  so  that, 
gentlemen,  if  this  watch  was  not  a  necessity, 
or  clearly  to  the  boy's  prejudice,  and  not 
for  his  benefit,  then  he  could  avoid  it,  and 
he  should  not  be  charged  with  the  watch; 
and  the  defendant  shoiUd  deal  in  good  faith 
with  the  infant  if  it  was  not  a  necessity; 
and,  if  any  unfair  advantage  was  taken  of 
the  boy,  then  he  might  avoid  the  contract. 
— then  this  contract  as  to  this  watch,  under 
the  circumstances  of  this  case,  might  be 
avoided  and  repudiated  by  the  boy."  We 
think  this  instruction  sufficiently  favorable 
to  the  defendant.  There  was  evidence  which, 
in  view  of  the  boy's  age,  tended  to  show  that 
an  unfair  advantage  was  taken  of  him  by  thb 
plaintiff.  While,  ordinarily,  representations 
as  to  value  are  not  evidence  of  fraiid.  yet  in 
a  case  like  this,  where  one  is  dealing  wFth  an 
infant,  who  is  presumed  by  law  to  be  unfa- 
miliar with  values  of  property  of  this  char- 
acter, we  think  it  is  proper  to  submit  to  the 
jury  the  question  of  whether  good  faith  was 
observed.  If  the  jury-  found,  imder  the  in- 
structions, that  the  watch  was  not  a  neces- 
sity, the  defendant  was  clearly  not  entitled 
to  offset  the  claim  for  the  watch  against  the 
demand  of  the  plaintiff".  The  question  of 
whether,  if  the  consideration  had  been  paid 
by  the  plaintiff",  he  could,  before  reaching  his 
majority,  repudiate  the  contract,  is  not  in- 
A'olved.  It  is  the  defendant  who  here  in- 
vokes the  aid  of  the  court  to  enforce  the  con- 
tract, and  the  case  comes  within  Wood  v. 
Losey,  50  Mich.  475,  15  N.  W.  557.  .Judg- 
ment will  be  affirmed,  with  costs,  'i'he  other 
justices  concurred. 


28 


INFANTS. 


JOHNSON  T.   NOinriWESTERN  MUT. 
LIFE  INS.  CO.i 

(59  N.  W.  992.  56  Minn.  3G5.) 

Supreme  Court  of  Minnesota.     July  10,   1894. 

Appeal  from  district  court,  Hennepin  coun- 
tj-;   Sea^rave  Smith,  Juclf?o. 
On  reliearing.    Atlirmod. 
For  former  report,  see  57  N.  W.  934. 

Lusk,  Bann  &  Hadley,  for  appellant.  F.  P. 
Lane  and  W.  H.  Briggs,  for  respondent. 

MITCHELL,  J.  This  case  was  argued  and 
decided  at  the  last  term  of  this  court.  57  N. 
W.  034.  A  reargument  was  granted  for  the 
reasons  that  although  the  amount  was  small 
the  legal  principles  involved  were  very  im- 
portant; the  time  permitted  for  argument  un- 
der our  rules  was  brief;  the  case  was  de- 
cided near  the  end  of  the  term,  without,  per- 
hap.s.  the  degree  of  consideration  that  its  im- 
portance demanded;  and,  on  fm'ther  reflec- 
tion, we  are  not  satisfied  that  our  decision 
was  correct. 

The  former  opinion  laid  down  the  following 
prop()sition.s,  to  which  we  still  adhere:  (1) 
That  the  contract  of  insurance  was  of  benefit 
to  the  infant  himself,  and  was  not  a  contract 
for  the  benefit  of  third  parties.  (2)  The  con- 
tract, so  far  as  appears  on  its  face,  was  the 
usual  and  ordinary  one  for  life  insurance,  on 
the  customary  terms,  and  was  a  fair  and  rea- 
sonable -ne,  and  free  from  any  fraud,  unfair- 
ness, or  undue  influence  on  part  of  the  de- 
fendant, unless  the  contrary  is  to  be  pre- 
sumed from  the  fact  that  it  was  made  with 
the  infant.  It  is  not  correct,  however,  to  say 
that  the  plaintiff  has  received  no  benefit  from 
the  contract,  or  that  the  defendant  has  parted 
with  nothing  of  value  under  it.  True,  the 
plaintiff  has  received  no  money,  and  the  de- 
fendant has  paid  none  to  the  plaintiff;  but 
the  life  of  the  former  was  insured  for  fom' 
years,  and  if  he  died  during  that  time  the  de- 
fendant would  have  had  to  pay  the  amount 
of  the  policy  to  his  estate.  The  defendant 
carried  the  risk  all  that  time,  and  this  is  the 
essence  of  the  contract  of  insurance.  Nei- 
ther does  it  follow  that  the  risk  has  cost  the 
defendant  nothing  in  money  because  plaintiff 
himself  was  not  one  of  those  insm-ed  who 
died.  The  case  is  therefore  one  of  a  void- 
able or  re.5cindable  contract  of  an  infant, 
partly  performed  on  both  sides,  the  benefits 
of  which  the  infant  has  enjoyed,  but  which 
he  cannot  retm-n,  and  where  there  is  no 
charge  of  fraud,  unfairness,  or  undue  in- 
fluence on  the  part  of  the  other  party,  unless, 
as  ah-eady  suggested,  it  is  to  be  presumed 
from  the  fact  that  the  contract  was  made 
with  an  infant.  The  question  is,  can  the 
plaintiff  recover  back  what  he  has  paid,  as- 
suming that  the  contract  was  in  all  respects 
fair  and  reasonable V  The  opinion  heretofore 
filed  held  that  he  can.     Without  taking  time 


1  Dissenting 
omitted. 


opiniun     of     Gilfillan,     C.     J., 


to  cite  or  discuss  any  of  our  former  decisions, 
it  is  sufficient  to  say  that  none  of  them  com- 
mit this  court  to  such  a  doctrine.  That  such 
a  rule  goes  further  than  is  necessary  for  the 
protection  of  the  infant,  and  would  often 
work  gross  injustice  to  those  dealing  with 
him,  is,  to  our  minds,  clear.  Suppose  a  minor 
engaged  in  agriculture  should  hire  a  man  to 
work  on  his  farm,  and  pay  him  reasonable 
wages  for  his  services.  According  to  this 
rule  the  minor  might  recover  back  what  he 
paid,  although  retaining  and  enjoying  the 
fruits  of  the  other  man's  labor.  Or,  again, 
suppose  a  man  eng.ig(>d  in  mercantile  busi- 
ness, with  a  capital  of  .$5,000.  should,  from 
time  to  time,  buy  and  pay  for  .$100,000  worth 
of  goods,  in  the  aggi'egate,  which  he  had  sold, 
and  got  his  pay.  According  to  this  doctrine, 
he  coidd  recover  back  the  $100,(JO0  which  he 
had  paid  to  the  various  parties  from  whom 
he  hiid  bought  the  goods.  Not  only  would 
such  a  rule  work  great  injustice  to  others,  but 
it  would  be  positively  injurious  to  the  infant 
himself.  The  policy  of  the  law  is  to  shield 
or  protect  the  infant,  and  not  to  debar  him 
from  the  privilege  of  contracting.  But,  if  the 
rule  suggested  is  to  obtain,  there  is  no  foot- 
ing on  which  an  adult  can  deal  with  him,  ex- 
cept for  necessaries.  Nobody  could  or  would 
do  any  business  with  him.  He  could  not  get 
his  life  insm-ed.  He  could  not  insure  his 
property  against  fire.  He  could  not  hire 
servants  to  till  his  farm.  He  could  not  im- 
prove or  keep  up  his  land  or  buildings.  In 
short,  however  advantageous  other  contracts 
might  be  to  him,  or  however  much  capital  he 
might  have,  he  could  do  absolutely  nothing, 
except  to  buy  necessaries,  because  nobody 
would  dare  to  contract  wi«th  him  for  any- 
thing else.  It  cannot  be  that  this  is  the  law. 
Certainly,  it  ought  not  to  be. 

The  following  propositions  are  well  settled, 
everywhere,  as  to  the  resciudable  contracts 
of  an  infant,  and  in  that  category  we  include 
all  contracts  except  for  necessaries:  First. 
That,  in  so  far  as  a  contract  is  executory  on 
pait  of  an  infant,  he  may  always  interiwse 
his  infancy  as  a  defense  to  an  action  for  its 
enforcement.  He  can  always  use  his  infancy 
as  a  sliield.  Second.  If  the  contract  has  been 
wholly  or  partly  performed  on  his  part,  but 
is  wholly  executory  on  part  of  the  other 
party,  the  minor  therefore  having  received 
no  benefits  from  it,  he  may  recover  back 
what  he  has  paid  or  parted  with.  Third. 
Where  the  contract  has  been  wholly  or  partly 
performed  on  both  sides,  the  infant  may  al- 
ways rescind,  and  recover  back  what  he  has 
paid,  upon  restoring  what  he  has  received. 
Fourth.  A  minor,  on  arriving  at  full  age, 
may  avoid  a  conveyance  of  his  real  estate 
without  being  required  to  place  the  gi-antee 
in  statu  quo.  although  a  different  rule  has 
sometimes  been  adopted  by  courts  of  equity 
when  the  former  infant  has  applied  to  them 
for  aid  in  avoiding  his  deeds.  Whether  this 
distinction  between  conveyances  of  real  prop- 
erty and  personal  contracts  is  founded  on  a 


INFANT?!. 


29 


technical  rule,  or  upon  considerations  of  ixjli- 
cy  gi-owinj?  out  of  the  difference  between  real 
and  personal  property,  it  is  not  necessary 
here  to  consider.  Filth.  Wliere  the  contract 
has  been  wholly  or  partly  performed  on  both 
sides,  the  infant,  if  he  sues  to  recover  back 
what  he  has  paid,  must  always  restore  what 
he  has  received,  in  so  far  as  he  still  retains 
it  in  specie.  Sixth.  The  courts  will  always 
l^Tant  an  infant  relief  where  the  other  party 
has  been  suilty  of  fraud  or  undue  influence. 
As  to  what  would  constitute  a  sutticieut 
fe'round  for  relief  under  this  licad,  and  what 
relief  the  courts  would  grant  in  such  cases, 
we  will  refer  to  hereafter. 

But  suppose  that  the  contract  is  free  from 
all  e  >ments  of  fraud,  unfairness,  or  over- 
reach .ig,  and  the  infant  has  enjoyed  the 
benelits  of  it,  but  has  spent  or  disposed  of 
what  he  has  received,  or  the  benetits  received 
are,  as  in  this  case,  of  such  a  nature  that 
they  cannot  be  restored.  Can  he  recover 
back  what  he  has  paid?  It  is  well  settled  in 
England  that  he  cannot.  This  was  held  in 
the  leading  case  of  Holmes  v.  Blogg,  8 
Taunt.  .jOS,  approved  as  late  as  ISOU  in  \vd- 
eutini  v.  Caiiali,  24  Q.  B.  Div.  106.  Some 
obiter  remarks  of  the  chief  justice  in  Holmes 
v.  Blogg,  to  the  effect  that  an  infant  could 
never  recover  back  money  voluntarily  paid, 
were  too  broad,  and  have  often  been  disap- 
proved,— a  fact  which  has  sometimes  led  to 
the  erroneous  imprt^ssion  that  the  case  itself 
has  been  overruled.  Corke  v.  Overton,  10 
Bing.  252  (decided  by  the  same  court),  held 
that  the  infant  might  recover  back  what  he 
had  voluntarily  paid,  but  on  the  ground  that 
the  c-ontract  in  that  case  remained  wholly  ex- 
ecutory on  part  of  the  other  party,  and  hence 
the  infant  had  never  enjoyed  its  benefits.  In 
Chitty  on  Contracts  (volume  1,  p.  222),  the 
law  is  stated  in  accordance  with  the  decision 
in  Holmes  v.  Blogg.  Leake,— a  most  accu- 
rate writer, — in  his  work  on  Contracts  (page 
.■>53),  sums  up  the  law  to  the  same  effect. 
In  this  country.  Chancellor  Kent  (2  Kent, 
Comm.  240),  and  Reeves  in  his  work  on  Do- 
mestic Relations  (chapters  2  and  3,  tit.  "Par- 
ent and  Child"),  state  the  law  in  exact  ac- 
cordance with  what  we  may  term  the  "Eng- 
lisli  rule."  Parsons,  in  his  work  on  Contracts 
(volume  1,  p.  322).  undoubtedly  states  the 
law  too  broadly,  in  omitting  the  qualification, 
"and  enjoj-s  the  benefit  of  it."  At  least  a  re- 
spectable minority  of  the  American  decisions 
are  in  full  accord  with  what  we  have  termed 
the  "English  rule."  See.  among  others.  Riley 
V.  Mallory,  SJ  Conn.  20G;  Adams  v.  Beall,  07 
Md.  53,  8  Atl.  004;  Breed  v.  Judd,  1  Gray. 
455.  But  many — perhaps  a  majority— of  the 
American  decisions,  apparently  thinking  that 
the  English  rule  does  not  sutliciently  protect 
the  infant,  have  modified  it;  and  some  of 
them  seem  to  have  wholly  repudiated  it,  and 
to  hold  that  although  the  contract  was  in  all 
respects  fair  and  reasonable,  and  the  infant 
had  enjoyed  the  benefits  of  it,  yet  if  the  in- 
fant had  spent  or  parted  with  what  he  had 


received,  or  if  tlie  benefits  of  it  were  of  such 
a  nature  that  they  could  not  be  restored,  .still 
he  miglit  recover  back  what  he  had  paid. 
The  pnjblem  with  the  courts  seems  to  have 
been,  on  the  one  hand,  to  protect  the  infant 
from  the  improvidence  incident  to  his  youth 
and  inexperience,  and  how,  on  the  other  hand, 
to  compel  him  to  conform  to  the  principles 
of  tx>mmon  honesty.  The  result  is  that  the 
American  authorities— at  least  the  later  ones 
— have  fallen  into  such  a  condition  of  conflict 
and  confusion  that  it  is  difficult  to  draw  from 
them  any  definite  or  uniform  rule.  The  dis- 
satisfaction with  what  we  have  termed  the 
"English  rule"  seems  to  be  generally  based 
upon  the  idea  that  the  courts  would  not  grant 
an  infant  relief,  on  the  ground  of  fraud  or 
undue  influence,  except  where  they  would 
grant  it  to  an  adult  on  the  same  grounds, 
and  then  only  on  the  same  conditions.  Many 
of  the  cases,  we  admit,  would  seem  to  sup- 
port this  idea.  If  such  were  the  law,  it  is 
obvious  that  there  would  be  many  cases 
where  it  would  furnish  no  adequate  protec- 
tion to  the  infant.  Cases  may  be  readily 
imagined  where  an  infant  may  have  paid  for 
an  article  several  times  more  than  it  was 
worth,  or  where  the  contract  was  of  an  im- 
provident character,  calculated  to  result  in 
the  squandering  of  his  estate,  and  that  fact 
was  known  to  the  other  party;  and  yet  if  he 
was  an  adult  the  court  would  grant  him  no 
relief,  but  leave  him  to  stand  the  con.se- 
quences  of  his  own  foolish  bargain.  But  to 
measure  the  right  of  an  infant  in  such  casus 
by  the  same  rule  that  would  be  applied  in 
the  case  of  an  adult  would  be  to  fail  to  give 
due  weight  to  the  disparity  between  the  adult 
and  the  infant,  or  to  apply  the  proper  stand- 
ard of  fair  dealing  due  from  the  former  to 
the  latter.  Even  as  between  adults,  when  a 
transaction  is  assailed  on  the  ground  of 
fraud,  undue  influence,  etc.,  their  disparity 
in  intelligence  and  experience,  or  in  anj-  other 
respect  which  gives  one  an  asc-endency  over 
the  other,  or  tends  to  prevent  the  latter  from 
exercising  an  intelligent  and  unbiased  judg- 
ment, is  always  a  most  vital  consideration 
with  the  courts.  Where  a  contract  is  im- 
provident and  unfair,  courts  of  equity  have 
frequently  inferred  fraud  from  the  mere  dis- 
parity of  the  parties.  If  this  is  true  as  to 
adults,  the  rule  ought  certainly  to  be  applied 
with  still  greater  liberality  in  favor  of  in- 
fants, whom  the  law  deems  so  incomjietcnt 
to  care  for  them.selves  that  it  holds  them 
incapable  of  binding  themselves  by  contract, 
except  for  necessaries.  In  view  of  this  dis- 
parity of  the  parties,  thus  recognized  by  law, 
eveiy  one  who  assumes  to  contract  with  an 
infant  should  be  held  to  the  utmost  good  faith 
and  fair  dealing.  We  further  think  that  this 
disparity  is  such  as  to  raise  a  presuiniition 
against  the  fairness  of  the  contract,  and  to 
cast  upon  the  other  party  the  burden  of  prov- 
ing that  it  was  a  fair  and  reasonable  one, 
and  free  from  any  fraud,  undue  influence,  or 
overreaching.     A  similar  principle  applies  to 


30 


INFANTS. 


all  the  relations,  where,  from  disparity  of 
years,  intellect,  or  knowledge,  one  of  the  par- 
ties to  the  contract  has  an  ascendency  which 
prevents  the  other  from  exercising  an  un- 
biased judgment,— as,  for  example,  parent 
and  child,  husband  and  wife,  guardian  and 
ward.  It  is  true  that  the  mere  fact  that  a 
person  is  dealing  with  an  infant  creates  no 
"fiduciary  relation"  between  them,  in  the 
proper  sense  of  the  term,  such  as  exists  be- 
tween guardian  and  ward;  but  we  think  that 
he  who  deals  with  an  infant  should  be  held 
to  substantially  the  same  standard  of  fair 
dealing,  and  be  charged  with  the  burden  of 
proving  that  the  contract  was  in  all  respects 
fair  and  reasonable,  and  not  tainted  with 
any  fraud,  undue  influence,  or  overreaching 
on  his  part.  Of  course,  in  this  as  in  all  other 
cases,  the  degree  of  disparity  between  the 
parties,  in  age  and  mental  capacity,  would 
be  an  important  consideration.  Moreovei*,  If 
the  contract  was  not  in  all  respects  fair 
and  reasonable,  the  extent  to  which  the  in- 
fant should  recover  would  depend  on  the 
nature  and  extent  of  the  element  of  unfair- 
ness which  characterized  the  transaction.  If 
the  party  dealing  with  the  infant  was  guilty 
of  actual  fraud  or  bad  faith,  we  think  the 
infant  should  be  allowed  to  recover  back 
all  he  had  paid,  without  making  restitu- 
tion, except,  of  course,  to  the  extent  to 
which  he  still  retained  in  specie  what  he 
had  received.  Such  a  case  would  be  a  con- 
tract essentially  improvident,  calculated  to 
facilitate  the  squandering  the  infant's  estate, 
and  which  the  other  party  knew  or  ought  to 
have  known  to  be  such,  for  to  make  such  a 
contract  at  all  with  an  infant  would  be  fraud. 
But  if  the  contract  was  free  from  any  fraud 
or  bad  faith,  and  otherwise  reasonable,  ex- 
cept that  the  price  paid  by  the  infant  was  in 
excess  of  the  value  of  what  he  received,  his 
recovery  should  be  limited  to  the  difference 
between  what  he  paid  and  what  he  received. 
Such  cases  as  Medbury  v.  Watrous,  7  Hill, 
110;  Sparman  v.  Keim,  S3  N.  Y.  24.5;  and 
Heath  v.  Stevens,  48  N.  H.  251,— really  pro- 
ceed upon  this  principle,  although  they  may 
not  distinctlj'  announce  it.  The  objections  to 
this  rule  are,  in  our  opinion,  largely  imag- 
inary, for  we  are  confident  that  in  practice  it 
can  and  will  be  applied  by  courts  and  juries 
so  as  to  Avork  out  substantial  justice. 

Our  conclusion  is  that  where  the  personal 
contract  of  an  infant,  beneficial  to  himself. 
has  been  wholly  or  partly  executed  on  both 
sides,  but  the  infant  has  disposed  of  what  he 
has  received,  or  the  benefits  recovered  by 
him  are  such  that  they  cannot  be  restored, 
ho  cannot  recover  back  what  he  has  paid,  if 
the  contract  was  a  fair  and  reasonable  one. 


and  free  from  any  fraud  or  bad  faith  on  part 
of  the  other  pai'ty,  but  that  the  burden  is  on 
Ilu>  other  part.v  to  prov(»  that  such  was  the 
character  of  the  contract;  that,  if  the  con- 
tract involved  the  element  of  actual  fraud  or 
bad  faith,  the  infant  may  recover  all  he  paid 
or  parted  with,  but  if  the  contract  involved 
no  such  elemc^nts,  and  was  otherwise  reason- 
able and  fair,  except  that  what  the  infant 
l)aid  was  in  excess  of  the  value  of  what  he 
received,  his  recovery  should  be  limited  to 
such  excess.  It  seems  to  us  that  this  will 
sutliciently  protect  the  infant,  and  at  the 
same  time  do  justice  to  the  other  party.  Of 
course,  in  speaking  of  contracts  beneficial  to 
the  infant,  Ave  refer  to  those  that  are  deemed 
such  in  contemplation  of  laAV. 

A])plying  these  rules  to  the  case  in  hand, 
we  add  that  life  insurance  in  a  soh'ent  com- 
pany, at  the  ordinary  and  usual  rates,  for  an 
amount  reasonably  commensurate  Avith  the 
infant's  estate,  or  his  financial  ability  to  car- 
ry it,  is  a  provident,  fair,  and  reasonable  con- 
tract, and  one  Avhich  it  is  entirely  proper  for 
an  insiu-ance  company  to  make  with  him,  as- 
suming that  it  practices  no  fraud  or  other 
unlaAA'ful  means  to  secure  it;  and  if  such 
should  appear  to  be  the  character  of  this  con- 
tract the  plaintiff  could  not  recover  the"  pre- 
miums which  he  has  paid  in,  so  far  as  they 
Avere  intended  to  cover  the  current  annual 
risk  assumed  by  the  company  under  its  pol- 
icy. But  it  appears  from  the  face  of  the  pol- 
icy that  these  premiums  covered  something 
more  than  this.  The  policy  provides  that 
after  payment  of  three  or  more  annual  pre- 
miums the  insured  Avill  be  entitled  to  a  paid- 
up,  nonparticipating  policy  for  as  many 
tA\-entieths  of  the  original  sum  insured  (.$1,- 
000)  as  there  have  been  annual  premiums  so 
paid.  The  complaint  alleges  the  payment  of 
four  annual  premiums.  Hence,  the  plaintiff 
was  entitled,  upon  surrender  of  the  original 
policy,  to  a  paid-up,  nonparticipating  policy 
for  $200;  and  it  therefore  seems  to  us  that, 
having  elected  to  rescind,  he  Avas  entitled  to 
recover  back,  in  any  event,  the  present  cash 
"surrender"  value  of  such  a  policy.  For  this 
reason,  as  Avell  as  that  the  burden  was  on 
the  defendant  to  prove  the  fair  and  honest 
character  of  the  contract,  the  demurrer  to 
the  complaint  Avas  properly  overruled.  The 
result  arrived  at  in  the  former  opinion  Avas 
therefore  correct,  and  is  adhered  to,  although 
on  somcAvhat  different  grounds.  Order  af- 
firmed. 

BUCK,  J.,  absent,  sick,  took  no  part. 
GILFILLAN,  C.  J.,  dissents. 


INFANTS. 


31 


BLOOMINGDALE  v.  CIIirTENDEN. 

(42  N.  W.  l()<j.  74  Midi.  (;O.S.i 
Suiircuic   Court    of  Michigan.      April   24,    l.SSi». 

Case  made  I'loni  circuit  couit,  Ionia  county; 
Vkknon  H.  Smith,  Judge. 

J{('})levin  by  George  lJlooinin;Td;de  by  Al- 
vira  JJlooniingdale,  liis  next  Iricnd,  against 
Leonard  Cliittenden,  to  recover  possession  of 
a  colt.  The  court  found  tlie  facts  as  follows: 
"(1)  The  property  fur  which  tliis  action  was 
brought,  prior  to  .January  oO,  188G,  belonged 
to  and  was  the  property  of  the  plaintiff  in 
this  cause.  (2)  Tiiat  about  that  date,  Janu- 
ary 30.  1880,  it  was  included  with  other 
property  in  a  bill  of  sale  to  defendant,  which 
bill  of  sale  was  signed  by  plaintiff  and  his 
mother,  and  her  husband,  John  Blooming- 
dale.  (3)  That  plaintiff  included  this  prop- 
erty in  the  bill  of  sale  to  defendant,  intending 
to  keep  it  from  the  hands  of  John  Blooming- 
dale's  creditors;  that  he  never  intended  to 
transfer  the  title  to  defendant,  and  he,  the  de- 
fendant, did  not  understand  that  he  was  to 
become  owner  of  same.  (4)  That  it  (the 
property)  belonged  to  plaintiff  before  the 
bill  of  sale  to  defendant;  that  it  was  not  in- 
tended to  pass  title  to  same  to  defendant,  and 
the  plaintiff'  was  the  owner  of  the  same  at 
the  time  of  the  commencement  of  this  suit, 
and  hence  entitled  to  possession  thereof. 
(5)  That  plaintiff  was  a  minor  under  the  age 
of  twenty-one  years  at  the  date  of  bill  of 
sale,  January  30,  1886,  and  still  under  twen- 
ty-one years  of  age  at  time  of  trial  of  this 
■cause,  and  no  consideration  was  paid  by  de- 
fendant to  the  plaintiff'  for  said  property.  I 
conclude,  as  a  matter  of  law,  that  as  John 
Bloomingdale's  creditors  would  have  no  right 
to  take  this  plaintiff's  property  to  satisfy 
John  Bloomingdale's  debts,  that  this  plaintiff 
is  not  estopped  or  prevented  from  asserting 
his  right  to  its  possession;  and  that  judgment 


should  be  for  plaintiff  for  six  cents  damages, 
and  costs  to  be  taxed."  Defendant  con- 
tended that  an  infant's  voidalde  contract 
cannot  be  disallirmed  during  infancy,  either 
liy  himself  or  any  one  for  him.  It  can  only 
i)e  done  by  himself,  and  that  after  he  becomes 
of  age. 

Frank  A.  liothfers,  for  plaintiff".  (Jlcason 
&  Bandy,  for  defendant. 

CAMl'BKLL,  J.  lieplevin  was  brougiit 
against  defendant  for  a  colt  belonging  to  the 
infant  plaintiff.  It  appears  by  the  special 
finding  tliat  the  colt  belonged  to  the  boy,  and 
was  included  in  a  bill  of  sale  signed  by  him 
with  his  father  and  mother,  made  to  defend- 
ant, without  consideration,  and  with  no  in- 
tention of  passing  title.  The  purpose  of  the 
parties  was  to  keep  it  from  being  seized  by 
the  father's  creditors.  There  could  be  no 
fraud  in  preventing  creditors  from  seizing 
what  they  had  no  right  to  seize.  lint  this 
infant  could  not  be  bound  by  a  transfer  of 
his  pro2)eity  which  could  not  possibly  be  for 
his  benelit,  and  still  less  by  a  formality  whicli 
no  one  supposed  was  meant  to  divest  his 
title.  Such  a  transfer  is  not  presumed  to  be 
binding  for  any  purpose,  and  an  action  lies 
at  once  to  resume  the  property  from  the  un- 
authorized holder,  and  it  is  properly  brought 
in  the  infant's  name  by  his  next  friend. 
There  is  nothing  in  the  finding  to  invalidate 
the  proceeding  as  brought,  and  the  objec- 
tions urged  on  the  argument  are  of  no  ac- 
count. It  may  be  remarked  that  the  printed 
record  shows  neither  exceptions  nor  assign- 
ments of  error.  If  none  were  filed,  there  is 
nothing  to  review.  But  we  see  no  error 
which  could  have  been  relied  on.  Thejudg- 
ment  must  be  athrmed,  with  costs. 

SHKllWOOD.  ('.  J.,  and  CHAMl'MX, 
MOiiSE,  and  LONG,  JJ..  concurred. 


32 


INFANTS. 


I'EMKHKTON  BUII.DIN(;  &  LOAN  ASS'N 
V.   ADAMS. 

(31  Atl.  280,  53  N.  J.  E(i.  i2').S.) 

Court  of  Chancery  of  Now  .Torsoy.      March   C, 
1  S!>."). 

Bill  by  the  Pemberton  BnihliiiR  &  Loan 
Associiitlon  ajjaiiKst  George  L.  Adams.  De- 
cree for  complainant. 

Joseph  H.  Gaskill,  for  complainant.  John 
W.  Wharton,  for  dolVndaut. 

BIRD,  V.  C.  The  principal  question  in 
this  case  is  whether  the  defendant,  George 
L.  Adams,  represented  hims'elf  to  be  of  age, 
and  on  such  representations  secured  the  loan 
of  the  moneys  named  in  the  mortgage.  The 
evidence  sho\vs  that  when  the  parties  were 
neg.)tiating  the  person  making  the  loan  ask- 
ed Adams  if  he  was  of  age,  to  which  Adams 
replied  that  he  was.  That  such  inquiry  was 
made  is  not  only  established  by  the  testi- 
mony of  the  person  who  made  it,  but  by  a 
bystander,  who  distinctly  heard  the  inquiiy, 
but  did  not  hear  the  answer  thereto,  although 
he  swears  that  something  was  said  by  way 


of  replj-.  Adams  says  he  made  no  represen- 
tations concerning  his  age.  I  have  no  doubt 
but  the  inquiry  was  made,  and  that  the  an- 
swer was  purposely  false.  It  is  equally  '-loar 
that  the  statement  that  he  was  of  age  was 
relied  upon;  and  that  the  loan  would  not 
have  been  made  if  the  answer  had  been  ac- 
cording to  the  fact.  The  law  will  not,  under 
such  circumstances,  allow  a  frauddoer  to 
protect  himself  imder  the  plea  of  infancy. 
Jones,  Mortg.  §  (i31;  Herm.  Estop,  p.  1232, 
§S  1100,  1118;  Id.  p.  ]2.->3.  §  119;  Parker  v. 
Hayes,  39  N.  J.  Eq.  478,  479;  Id.,  41  N.  J. 
E(i.  631,  G33.  7  Atl.  511;  2  Pom.  Eq.  Jur. 
§§  780,  945.  In  the  next  place,  Adams,  after 
coming  of  age,  retained  the  possession  of 
this  property,  and  claimed  and  enjoyed  all 
the  benefits  of  a  conveyance  thereof,  and 
now  raises  this  defense  of  infancy  without 
offering  to  return  the  consideration  money. 
L-nder  these  circumstances,  his  liability  con- 
tinues, even  though  there  had  been  no  fraud. 
Jones,  Mortg.  §§  104,  105;  Herm.  Estop,  p. 
1257,  §  1121;  3  Wait,  Act.  &  Def.  44.3,  and 
many  cases  there  cited;  1  Story,  Eq.  Jur. 
§  385.  The  complainant  is  entitled  to  a  de- 
cree, with  costs.     I  will  so  advise. 


1. NT  A. NTS. 


33 


STACK  V.  CAVA.\Ar(H  ct  al. 

(30  Atl.  :;.-)(•.) 

Supremo  Court   of  New  Hauipshin'.      Ilillslior- 
ough.      March  11,  l,s;)-_'. 

Assumpsit  by  Timothy  Stack  ajiainst  Cav- 
auaiif^li  Bros,  to  recover  money  i)ai(l  in  tlie 
I)urchase  of  a  horse.     Juilfjment  for  phiiiitiff. 

At  an  auction  sale  of  hors«*s  by  tlie  defend- 
ants October  11'.  ISSt!.  the  plaintiff  bid  off  a 
Lor.se  at  the  price  of  $112.51),  Avhich  was  de- 
livered to  him  on  payment  of  .$2r».  and  upon 
the  uuderstandins  tliat  the  balance  of  the 
price  was  to  be  secured  by  note  and  a  niort- 
yajie  upon  the  horse.  The  plaintiff  took  the 
horse  away,  and,  upon  harnessiufj  him  to 
a  wagon,  found  that  he  wtus  unable  to  drive 
him.  The  plaintiff  took  the  horse  back  to 
the  defendants'  stable  that  niiiht,  told  tliem 
the  horse  woidd  not  go,  and  ask(>d  them  to 
refund  the  $2r>.  The  defendants  declined  to 
pay  back  the  money,  but  offered  to  exchange 
horses  witli  tlie  plaintiff;  and  another  horse, 
which  they  bought  in  the  west,  had  had  but 
a  few  days,  and  had  driven  two  or  three 
times,  was  harnessed,  and  the  plaintiff  rode 
after  him,  but  concluded  not  to  take  him. 
The  plaintiff  left  the  horse  at  the  defend- 
ants' stable,  and  requested  them  to  do  the 
best  they  could  with  him.  Upon  harnessing 
the  horse  the  next  morning,  he  was  foiuid  to 
be  toutrax-y  and  unmanageable,  and  some 
time  afterwards  he  was  sent  to  Boston  and 
sold,  and  the  c)efendauts  received  $7U  for 
him.  after  de<luctiug  expenses.  The  horse 
was  six  years  old,  and  had  been  broken  to 
travel  with  another  hor.se.  but  had  li'en  driv- 
en to  a  single  can-iage  only  once  or  twice  be- 
fore the  day  of  the  sale.  A  person  accus- 
tomed to  handle  horses  could  drive  him. 
The  plaintiff  had  no  experience  in  driving  or 
1:  mdling  horses,  and  was  unable  to  drive  or 
u'.anage  him.  The  horse  was  fretted  and 
worried,  and  made  balky  and  unmanageable 
by  the  plaintift"'s  unskillful  management  in 
attempting  to  drive  him.  and  was  depreciated 
in  value  thereby  to  an  amount  exceeding  the 
sum  paid  by  the  plaintiff"  to  the  defendants. 
The  plaintiff  had  the  horse  in  his  possession 
four  or  five  hours.  The  plaintiff'  was  a  mi 
nor  when  he  bought  the  horse  and  when  this 
suit  was  commenced.  He  never  told  the  de- 
fendants that  he  was  an  infant,  and  they  did 
not  know,  and  had  no  reason  to  suppose,  that 
such  was  the  fact  until  the  plaintiff's  mother 
informed  them,  and  i-eciuested  them  to  pay 
back  the  $2.j,  six  or  eight  months  after  the 
transaction.  The  contract  for  the  purchase 
of  the  horse  was  not  a  contract  for  necessa- 
ries, nor  did  the  plaintiff  derive  any  beneflt 
from  it. 

Burnham,  Brown  &  Warren,  for  plaintiff. 
0.  E.  Branch  &,  J.  F.  Briggs,  for  defendants. 

ALLEX.  J.  It  is  the  settled  law  of  this 
stiite  that  an  infant  may  avoid  his  contract 
of  sale  by  rescinding  the  contract  and  re- 
storing the   property   to  the  vendor.     If   he 

YAK  ZILE  SEL.CAS.SALES — 3 


does  SO.  he  may  recover  tlie  price  paid  by 
him  for  th(>  property.  Heath  v.  Stevens.  48 
N.  H.  2."'>1.  If  he  does  not  restore  the  gomls. 
and  has  not  i)aid  for  theui,  he  is  liable  in  a 
suit  by  the  vendor  for  so  much  of  the  price 
as  is  c(|ual  to  the  benefit  derived  from  the 
purchas  •.  Hall  v.  Butterfi<-ld.  .">!)  N.  H.  :;.')4; 
B.irtlett  V.  Bailey.  Id.  40.S.  In  this  case  th  • 
plaintiff'  returned  the  horse  to  the  defend- 
ants, red-.ccd  in  value  by  th(>  i)l;iintift"s  in- 
exiK'rience  and  want  of  skill  in  driving. 
Though  r(  tuned  on  the  same  day.  and  with- 
in a  few  hoius,  of  the  purchase,  it  was  not 
the  same  hoi-se  in  character  and  value.  But 
the  acts  of  the  plaintiff  in  dealing  with  the 
horse  were  th;'  result  of  ignorance  and  want 
of  skill  in  the  management  of  horses,  rather 
than  of  willful  abuse.  Being  an  infant  un- 
der full  age.  the  same  conduct  towards  a 
horse  bailed  to  him  for  hire  would  have 
given  the  owner  no  ground  for  n-covery. 
Eaton  V.  Hill.  .lO  N.  H.  2;r>.  It  is  only  for 
positively  tortious  acts  willfully  committed 
that  an  infant  is  liable  in  an  action  of  tres- 
pass or  case.  If  the  management  and  driv- 
ing of  the  horse  by  the  plaintiff  in  this  case 
were  not  of  such  a  character  as  to  give  the 
defendants  a  right  of  action  had  the  plaintiff 
hired  the  horse,  they  cannot  make  the  fact 
of  injury  from  the  same  treatment  by  him 
as  owner  of  the  horse  a  ground  for  recorp- 
ment  of  damages.  To  give  them  this  right 
the  claim  mu.st  rest  upon  a  basis  which 
would  enable  them  to  recover  for  an  injury 
to  their  own  property,  and  this  they  cannot 
do  in  a  case  of  this  kind  against  an  in- 
fant. The  plaintiff's  incapacity  of  infancy 
vas  known  to  the  defi'iidants  before  the  suit 
vas  brought,  and  his  treatment  of  the  horse 
vas  not  malicious  nor  willful  abu.se.  Tjion 
he  facts  stated  the  defendants  have  no  de- 
■nse.     .Tudgment  for   the   plaintiff. 

CLARK,   .L,   did   not  sit.      Tlie  otlirrs  con- 
•urred. 

On   Rehearing. 

SMITH.  .1.  The  former  di'cision  in  thi.s 
case,  it  is  claimed,  was  based  uiion  the  erro- 
neous a.ssumption  of  fact  that  the  plaintiff 
had  rescinded  the  contract,  when  in  fact  he 
only  proposed  to  rescind,  ami.  instead  of  re- 
scinding, ratified  the  contract  by  leaving 
the  horst^  with  the  defendants  to  be  sold.  It 
is  further  claimed  that  when  repayment  of 
the  purcha.se  money  was  requested,  rescission 
had  become  impossible,  because,  the  horse 
liaving  biH'n  sold  on  the  plaintiff's  account, 
the  property  could  not  be  returned  in  specie. 
Whether  what  took  place  when  the  {ilaintiff 
returned  the  horse  was  a  rescission,  a  propo- 
sition for  a  rescission,  or  a  ratitication  of  the 
contract  of  purchas<>.  it  is  not  nect-ssary  to 
consider.  The  plaintiff's  right  of  rescission 
remained  during  his  minority,  and  was  not 
defeated  by  the  defendants'  refusal  to  refund 
the  purclia.se  money,  nor  by  his  retiuest  to 
them  to  do  the  best  they  could  with  the  prop- 
erty.    The  contract  and  subswiuent  alleged 


34 


INFANTS. 


ratification  were  voidable  at  his  election, 
and  wore  repudiated  when  he  brought  this 
suit.  The  bringing  of  the  suit  was  an  elec- 
tion to  ri^sfiud.  Eaton  v.  Hill.  .">0  N.  H. 
2H5.  241  Hie  fact  that  the  horse  had  been 
injured  bv  the  i»laintiff's  unskillful  driving 
did  not.  as  shown  in  tlu'  former  ()i)inion.  di>- 
prive  the  plaintiff  of  his  right  to  return  it. 
Ho  derived  no  benefit  from  the  contract.  It 
was  not  necessary  to  renew  his  offer  to  re- 
turn the  property.  It  went  into  the  defend- 
ants' possession  when  the  plaintiff  first  at- 
tempted to  rescind,  and  was  sold  by  them. 
The  money  received  by  them  from  the  sale 
stood  in  place  of  the  horse.  The  presump- 
tion is  that  they  acted  in  good  faith  in  the 
sale,  and  got  the  most  they  could  for  the 
property.      If   they   did    not,   they   are   in   no 


position  to  complain.  If  the  plaintiff's  mother 
was  acting  iu  his  behalf  when  she  re- 
quested the  return  of  the  purchase  money,^ 
what  was  then  done  was  etiuivalent  to  a 
rescission,  and  the  result  is  the  same.  The 
defendants  are  not.  as  contended,  entitl  d  to 
Judgment  upon  the  ground  that  they  had  no 
reason  to  su])pose  the  plaintiff  was  an  infant. 
He  did  not  affirm  himself  to  be  of  full  age. 
and  there  is  nothing  in  Ihe  case  that  shows 
thai  at  the  time  he  made  the  purchase  he 
intended  to  elude  the  contract.  The  case  fin 
this  resprct  differs  from  Fitts  v.  Hall.  9  N. 
H.  441  (see  page  440).  .Tudgment  for  the 
plaintiff. 


CLARK,  J.,  did  not  sit. 
curred. 


The  others  con- 


INFANTS. 


•s: 


GKE(JORY  V.  LEE. 

(30  Atl.  .-.3,  04  Conn.  407.) 

Snprome  Coiir*^  of  Error.s  of  CoinuH-ticut.      .Tvino  i 
20.  l.S!)4. 

Appeal  from  court  of  oomnion  pleas,  Now 
Haven  coutity;    Stiulley.  .Tudjie. 

Action  by  :Mary  E.  Gret,'ory  against  Frank 
Lee  for  rent  of  a  leased  room.  Judgment  for 
defendant,  and  plaintiff  appeals.     Aflirmed. 

Talcott  H.  Russell,  for  appellant.  Edward 
G.  Buekland  and  Harry  G.  Day,  for  appellee. 

TORRANCE,  .1.  The  complaint  in  this  case 
alleges  that  on  the  1st  of  .lune.  IS'Ji',  the 
defendant,  being  a  student  in  Yale  College, 
entered  into  a  contract  witli  the  plaintiff,  by 
which  he  leased  a  room  for  the  ensuing  col- 
lege year  of  40  weeks,  at  an  agreed  rate  of 
$10  per  week,  i)ayable  weekly,  and  immedi- 
ately entered  into  possession  of  said  room, 
and  has  neglectc^d  and  refused  to  pay  the 
rent  of  said  room  for  the  10  weeks  ending 
February  7,  1893.  The  answer,  in  substance, 
is  as  follows:  On  or  about  Sv'ptember  15, 
18'J2.  the  defendant  agreed  to  lease  a  room 
in  the  house  of  the  plaintiff  for  the  ensuing 
college  year  of  40  weeks,  at  the  agi'eed  rate 
of  $10  per  week,  payable  weekly;  that  he 
then  entered  into  possession  of  said  room, 
and  occupied  it  till  December  20,  1802;  that 
on  said  day  he  gave  up  possession  of  said 
room,  and  ceased  to  occupy  the  same,  and 
then  paid  to  the  plaintiff  all  he  owed  her  for 
such  occupation  and  possession  up  to  that 
time;  that  immediately  thereafter  he  en- 
gaged at  a  reasonable  price  another  suitable 
room  elsewhere,  and  continued  to  possess  and 
occupy  the  same  till  the  end  of  said  college 
year;  that  during  all  of  said  period  he  was 
a  minor,  and  a  student  in  said  college;  and 
tliat  on  December  20,  1802.  he  refused  to  ful- 
fill said  agi'eement  with  the  plaintiff  to  oc- 
cupy or  pay  for  said  room  for  the  remainder 
of  said  40  weeks,  and  has  always  refused  to 
pay  for  the  time  during  which  he  did  not  pos- 
sess or  occupy  said  room.  The  reply  to  the 
answer  was  as  follows:  "raragi-aph  1.  Plain- 
tiff admits  all  the  allegations  of  said  defense. 
Par.  2.  Defendant,  at  the  time  of  making 
said  contract,  was  between  nineteen  and 
twenty  years  of  age.  Par.  3.  Defendant  and 
his  parent.s  are  residents  of  the  island  of 
Trinidad.  His  father  makes  him  an  annual 
allowance,  out  of  which  he  is  expected  to 
defray  all  his  college  e.xpenses.  including 
room  and  board,  transacting  the  business 
incidental  thereto  in  his  own  name,  and  not 
on  account  of  his  father.  Par.  4.  It  is  the 
general  custom  among  stiidents  and  lodging- 
house  keepers  to  rent  rooms  for  the  college 
year  of  forty  weeks,  and  students  also  usu- 
ally contract  for  and  pay  tuition  by  the  year. 
Defendant,  at  the  time  of  renting  said  rooms, 
had  contracted  for  his  tuition  during  the  col- 
lege year.  Par.  .j.  The  rent  charged  for  tlie 
room  was  fair  and  reasonable,  and  was  suit- 
alile  to  his  necessities  as  a  student  and  to 


his  condition  in  life.  It  was  also  necessary 
for  him  to  have  a  room  as  a  place  of  lodging 
and  study  during  his  college  year.  Par.  (». 
Defendant  could  not  have  obtained  a  room 
(•qually  suitable  for  his  purpose,  nor  on  such 
advantageous  term.s,  if  he  had  not  contracti-d 
for  the  year,  «'xcept  by  going  to  a  hotel,  and 
paying  tlie  usual  cliarges  made  l>y  hotels  for 
such  periinl  as  he  wished  to  slay.  The  cost 
of  this  would  havi-  been  considerably  greater. 
Par.  7.  Owing  to  the  custom  above  noted, 
plaintiff  cannot  rent  her  room  for  tlie  balance 
of  the  year,  and  will  be  subjected  to  great 
lo.ss,  unless  defendant  is  compelled  to  j)ay 
rent  for  the  balance  of  said  period."  Ther.- 
was  also  tiled  in  the  case  a  .second  defi'Use 
and  a  reply  to  the  same,  which,  in  view  of 
the  conclusion  reaclunl  upon  the  lirst  defense 
and  the  rei)ly  tliereto.  need  not  be  consid- 
ered. To  the  reiily  above  set  out  the  defend- 
ant demurred  specially,  the  court  below  sus- 
tained the  demurrer,  and  judgment  was  ren- 
dered for  the  defendant.  Tlu-  sole  reason  of 
api)eal  is  the  clainied  error  of  the  court  in 
sustaining  the  dennn-rer. 

Upon  this  ai)peal  the  facts  stated  in  the  an- 
swer, and  also  in  the  reply  so  far  as  the  same 
are  well  ])leaded.  must  be  taken  to  be  true. 
It  thus  appears  that  the  defendant,  a  minor, 
agreed  to  hire  the  plaintiff's  room  for  -V) 
weeks  at  .$10  per  week,  and  that  he  euteivd 
into  ixxss«'ssion  and  occui)iiHl  it  a  part  of 
said  period;  that  he  gave  up  and  quit  posses- 
sion of  the  room,  and  refused  to  fultill  said 
agi-eement,  on  the  20th  of  December,  1802. 
paying  in  full  for  all  the  time  he  had  occu- 
pied it;  that  he  has  never  occupied  it  since, 
but  has  been  paying  for  and  occupying  a 
suitable  room  elsewhere.  Under  the  facts 
stated,  it  must  be  conee<led  that  this  room,  at 
the  time  the  def«'ndant  hired  it.  and  during 
the  time  he  occupietl  it,  came  within  the 
class  CiUled  "necessaries,"  and  also  that  to 
h'.m  dm-ing  said  period  it  was  an  actual  nec- 
essary, for  lodging  comes  clearly  within  the 
class  of  necessaries;  and  the  room  in  question 
was  a  suitalile  and  pmiK  r  one.  and  during  tlie 
period  he  occupii'd  it  was  his  only  lodging 
room.  "Things  necessary  are  those  without 
which  an  individual  cannot  reasonably  exist 
In  the  first  place,  food,  rainu-nt,  lodging,  and 
the  like.  About  these  there  is  no  doubt." 
Chappie  v.  Cooper.  13  Mees.  &  W.  2.52;  1 
Swift.  Dig.  r.2.  So  long,  then,  as  the  de- 
fendant actually  occupied  the  room  as  his 
sole  lodging  room  it  was  clearly  a  necessary 
to  him.  for  the  use  of  which  the  law  woiUd 
compel  him  to  pay;  but.  as  he  pai<l  the  agreed 
price  for  the  time  he  actually  occiipietl  it,  no 
(juestion  arises  upon  that  part  of  the  transac- 
tion between  these  jiarties.  The  question 
now  is  whether  he  is  bound  to  pay  for  the 
room  after  December  20.  1802.  The  obliga- 
tion of  an  infant  to  pay  for  ne^.e.'^s.iries  actual- 
ly furnished  to  him  does  not  seem  to  arise  out 
of  a  contract  in  the  legal  sense  of  that  term, 
but  out  of  a  transaction  of  a  quasi  contrac- 
tual nature;   for  it  may  be  imposed  on  an  in- 


ye 


INFANTS. 


i'ant  too  youiis  to  niidcrstand  the  nature  of  a 
coutnict  at  all.  Ilyman  v.  Cain,  3  Jones  (N. 
C.)  111.  And  wlu>re  an  infant  aj?i-ees  to  pay 
a  stipulated  price  for  sucli  necessaries,  the 
partj-  furnishing  them  recovers  not  necessari- 
ly that  price,  but  only  the  fair  and  rea.sonable 
value  of  the  nectsssaries.  P^arle  v.  Reed,  10 
Mete.  (Mass.)  387;  Hanies  v.  Barnes,  50  Conn. 
r>72;  Trainer  v.  Trumbull,  141  Mass.  527,  G 
N.  E.  7G1;  Keen.  Quasi-Cont.  p.  20.  This  be- 
in.u  so,  no  binding  obligation  to  pay  for  nec- 
essaries can  arise  imtil  they  have  been  sup- 
plied to  the  infant:  and  he  cannot  make  a 
binding  executory  agreement  to  purchase  nec- 
essaries. For  the  purposes  of  this  case,  per- 
haps, we  may  regard  the  transaction  which 
took  place  between  these  parties  in  Septem- 
bei%  l.S'.i2,  either  as  an  agreement  on  tlie 
I)art  of  the  plaintiff  to  supply  the  defendant 
with  necessary  lodging  for  the  college  year, 
and  on  the  part  of  the  defendant  as  an  exec- 
utory agi-eeiueut  to  pay  an  agreed  price  for 
the  same  from  Aveek  to  week;  or  we  may 
regard  it  as  what,  on  the  whole,  it  appears 
the  parties  intended  it  to  be,  a  parol  lease, 
under  which  possession  was  taken,  and  an 
executory  agreement  on  the  part  of  the  de- 
fendant to  pay  rent.  If  we  regard  it  in  the 
former  light,  then  the  defense  of  infancy  is  a 
good  defense;  for  in  that  case  the  suit  is 
upon  an  executory  contract  to  pay  for  nec- 
essaries which  the  defendant  refused  to  take, 
and  never  has  had.  and  which,  thei'efore,  he 
may  avoid.  If  we  regard  the  transaction  as 
a  lease  under  which  possession   was   taken. 


execute{l  on  the  part  of  the  plaintiff,  with 
a  promise  or  agreement  on  tlie  part  of  tli<' 
defendant  to  pay  rent  weekly,  we  think  in- 
fancy is  equally  a  defense.  Asa  general  rule, 
with  but  few  exceptions,  an  infant  may  avoid 
his  contracts  of  every  kind,  whether  bene- 
ficial to  him  or  not,  and  wliether  executed  or 
executory.  Kiley  v,  Mallory,  33  Comi.  201. 
The  alleged  agreement  in  this  case  does  not 
come  within  any  of  the  recognized  exception^ 
to  this  general  nile.  "An  infant  lessee  may 
also  avoid  a  lease,  although  it  is  always  avail- 
able for  the  purpose  of  vesting  the  estate  in 
him  so  long  as  he  thinks  proi^er  to  hold  it. 
*  *  *  As  to  his  liability  for  rent,  or  the 
jterformance  of  the  stiimlations  contained  in 
the  lease,  he  is  in  the  same  situation,  with  re- 
spect thereto,  as  in  case  of  an.v  other  contract; 
for  he  may  disaffirm  it  when  he  comes  of  age, 
or  at  any  time  previous  thereto,  and  thus 
avoid  his  obligation."  Tayl.  Landl.  &  Ten. 
§  9G.  In  this  case  the  defendant  gave  up  the 
room  and  repudiated  the  agreement,  so  far  as 
it  was  in  his  power  to  do  .so,  in  the  most  posi- 
tive and  imeciuivocal  manner.  The  plea  .if 
infancy,  then,  under  tue  circumstances,  must 
prevail,  imless  the  matters  set  up  in  the  re- 
plj'  make  the  facts  set  up  in  the  answer  una- 
vailable in  this  case.  Upon  this  point,  wi*:h- 
out  dwelling  in  detail  upon  the  matters  set  up 
in  the  differeut  paragi'aphs  of  the  reply,  we 
deem  it  sufficient  to  say  that  neither  singly 
nor  combined  do  the  matters  so  set  up  consti- 
tute a  sufficient  reply  to  the  answer.  There 
is  DO  error.     The  other  judges  concuri'ed. 


INFANTS. 


37 


I.ANCJDON  V.   CI.AVSON  ot   al. 

{4-J  N.  W.  SO.-),  75  Mi.li.  l;(»4.) 

Snpnano   Court  of   Michigan.     .Iiinc     14,    IHSl). 

Apppal  from  circuit  court,  Montcalm  coun- 
ty; Smith,  Judge. 

Lemuel  Clute,  for  complainant.  \V  C. 
Be<:l;with  and  Daois  &  Niclioln,  for  defend- 
ant I'aluier. 

CII  AMI'LIX,  .T.  Complainant  filed  liis  bill 
January  4,  1887,  to  foreclose  a  niuit<^age. 
As  originally  tih-d  it  contained  only  the  usual 
statements  of  liills  of  that  kind.  It  alleged 
that  xMay  Clayson  and  Charles  D.  Clayson 
made  their  two  promissory  notes  payable  to 
conijilainant,  dated  March  28,  1882, --one  for 
."*4Uii  due  three  years  from  date,  and  (heotiier 
for  .•?50l)  due  six  yiars  from  date,  with  inter- 
est payable  annually  at  7  per  cent.  The 
mortji:age  was  of  even  date,  and  was  exe- 
cut'd  by  May  Clayson,  and  covered  -40  acres 
of  land  in  Montcalm  county.  Luce  and 
Palmer  were  made  [)arties  as  siibsef]nent 
purchasers  or  incumbrancers.  Palmer  was 
the  only  defendant  who  answered.  He  set 
up  that  May  Clayson  was  an  infant  under  21 
years  of  age  at  the  time  she  executed  the 
mortgage,  and  that  it  was  given  to  secure 
the  debt  of  her  husband,  Charl  s  I).  Clayson. 
He  alleged  that  he  piucluised  the  premise's  on 
or  about  August  80,  ]8^'4,  from  May  Clay- 
son, paying  therefor  a  valuable  lonsideration, 
and  oitaining  a  quitclaim  deed,  and  after- 
wards, about  the  22d  day  of  Oclolier,  1884, 
after  said  May  Clayson  became  of  aire,  and 
for  a  valuable  consideration  to  the  sai  1  May 
Clayson  in  hand  paid,  she  made,  ext  cuted, 
and  delivered  to  him  a  v.arranty  deed,  and 
also  revoked  all  former  deeds  and  mortgages 
by  her  made  befnre  she  became  21  years  of 
age  by  inserting  therein  the  following:  "It 
being  the  intention  of  the  tirst  party  to  con- 
vey to  the  second  party  all  the  title  I  had  to 
the  premises  at  the  time  I  became  twenty- 
one  years  of  age,  and  to  ex[iressly  revoke  all 
former  deeds  and  mortgages  l)y  me  made  be- 
fore I  became  twenty-one  years  of  age." 
That  the  mortgage  to  complainant  is  void, 
and  constitutes  a  cloud  upon  his  title,  which 
he  asks  to  have  removed,  and  he  prays  for 
reliff  and  the  beiielit  of  a  cross-bill.  The 
complaiuant  then  amended  his  bill  of  com- 
plaint, stating  therein  that  May  Clayson 
purchased  the  land  from  John  il.  AVakely 
February  11,  1881,  and  took  from  hira  a 
warranty  deed  in  which  the  conveyance  to 
her  was  made  sul)ject  to  two  mortgages, — 
one  for  .<]00,  given  by  James  l^ich  and  wife 
to  Thomas  Fuller,  guardian  of  May  Fuller, 
and  the  other  for  .5500,  given  by  John  Q. 
Wakely  and  wife  to  James  Rich,-  which 
mortgages  were  to  be  paid  by  ]\Iay  Clayson 
as  part  of  the  consideration  for  the  land  on 
her  purchase  from  Wakely,  and  that  she  ob- 
tained the  loan  of  the  money  from  complain- 
ant for  which  said  notes  and  mortgage  were 
given  to  pay  the  above-mentioned   mortga- 


ges, that  she  stated  when  she  purchased  of 
Wakely,  tliat  such  indcble  mess  was  iipr 
own,  and  that  Charles  1).  Clayson  merely 
signed  the  notes  as  surety;  that  she  repre- 
sented hcrsi'lf  to  be  21  years  old,  and  that 
ctunplainant  woidd  not  have  loaned  the  money 
to  lier  had  he  supposed  that  she  w;is  an  in- 
fant. He  fartht-r  stated  that  afterwards,  and 
on  the  L.^th  of  Pebruary,  18s:5,  May  Clayson 
sold  and  conveyed  said  land  to  John  Q. 
Wakfly  by  warranty  (b  ed,  which  C(Uitained 
this  clause:  "The  above  is  subject  to  a  cer- 
tain mortgage  given  to  Langdon  .March  28, 
1882,  for  .S'.lOO;"  and  on  September  2,  1884, 
said  John  (^  Wakely  executed  a  deed  of  the 
land  to  V.  li.  Luce,  and  aftirwards,  on  July 
22  and  October  22,  lb84,  said  May  Clayson 
executed  the  deeds  above  referred  to.  The 
bill  charges  Luce  and  Palmer  w.tli  combii.iug 
and  confederating  Willi  May  Clayson  tocheat 
couip'ainant:  chargfs  on  belief  that  she  was 
of  full  age  wilt  II  she  execute  i  the  deed  to 
Wakely,  and  therein  ratihed  the  nmrti^aire; 
states  that  May  Chnson  and  Charles  D.  Clay- 
son have  removtd  to  and  are  risidents  of 
Dakota,  and  are  jiecuniarily  irrespons  ble; 
that  the  facts  and  ciicu instances  of  the  trans- 
action entitle  him,  if  she  was  a  minor,  to  be 
subrogated  to  the  rights  of  the  mortgagees 
named  in  the  deed  to  her  from  Wakely,  and 
which  she  piocuied  to  be  d.scharged  witli 
the  money  obtained  from  him. 

The  bill  of  complaint  was  taken  as  con- 
fessed against  all  of  the  defendants  except 
l^ilmer.  who  answered  the  amended  ttlll,  in 
which  he  sets  up  substantially  the  same  de- 
fense as  in  the  answer  to  tlie  original  bill, 
and  denies  all  confederacy  and  connivance  to 
cheat  and  defraud  complainant;  claims  that 
he  is  the  owner  in  fee:  and  claims,  further, 
the  benefit  of  a  cross-bill,  and  that  his  title 
may  be  quieted.  Proofs  have  been  taken 
from  which  it  appears  that  May  Clayson. 
whose  maiden  name  was  ^lay  Fuller,  was 
born  May  1.5,  18(32.  Tl.at  she  was  married 
to  Chailes  1).  Clayson  prior  to  Feliruary  11, 
1881.  On  February  11,  18sl,  John  (I  Wakely 
conveyed  to  May  Clayson  by  warranty  deed 
the  land  in  question,  in  which  deed  is  con- 
tained the  following:  "Said  second  party  tak- 
ing said  premises  subject  to  two  certain  mt)rt- 
gages, — oneof  .S;}00.  given  by  .James  liich  and 
wife  to  Thomas  F.  Fuller,  giianlian  of  May 
Fuller,  minor,  etc.,  the  other,  ."?500.  given  by 
John  (I.  Wakt  ly  ami  wife  to  .lames  Kich,  to- 
gether with  accrued  interest  on  the  sanit>; 
the  amount  of  said  mortgages  being  deducted 
from  the  purchase  price  of  said  premises  on 
this  puicliase."  The  mortgage  to  Fuller, 
gnarilian,  bears  date  June  80,  1879,  and  is 
given  to  secure  the  itayinent  of  .^oOO  on  the 
;id  day  of  April,  1888.  with  interest  at  7  per 
cent.,  payable  annually.  The  mortgage  to 
James  M.  Rich,  given  by  Wakely,  bears  date 
the  1st  day  of  October,  1880,  and  is  given  to 
secure  the  payment  of  ."i?500  on  the  1st  day  of 
April,  1884,  with  interest  at  the  rate  of  10 
per  cent.,  payable  semi-annually  on  the  1st 
days  of  October  and  April.     No  question  is 


38 


INFANTS. 


made  ;is  to  the  validity  of  these  mortgages. 
The  next  conveyance  in  the  order  of  time  is 
tlie  mortgage  to  complHinant  dated  Marcli  28, 
1882,  executed  by  May  Clayson  to  secure  the 
payment  of  tiie  notes  set  forth  in  the  l)ill  of 
comphiint.  On  the  same  day,  i.  e.,  Marcli 
28,  1882,  Kiith  l\Opp,  the  assignee  of  the 
moitgage  executed  by  James  M.  Rich  to 
Tiiomas  F.  Fuller,  guardian,  dated  June  13, 
1879,  executed  a  full  satisfaction  and  dis- 
charge tiiereof,  and  also,  on  the  sam  •  day, 
James  M.  Kich  executed  a  full  satisfaction 
and  discharge  of  the  mortgage  given  by 
Wakely  to  him  on  October  1,  1880.  The 
mortgage  to  complainant  and  the  two  dis- 
cliarges  above  mentioned  were  each  recorded 
in  the  register's  office  on  the  29th  of  March, 
1882,  at  13  o'clock  p.  M.  On  the  28th  da.', 
of  February,  1883,  May  Chiyson  executed  a 
statutory  vvarr.nity  deed  of  the  land  to  John 
Q.  Wakely,  which  contains  this  sentence: 
"The  above  is  subject  to  a  certain  mortgage 
given  to  Langdon  March  28,  1882,  for  nine 
liundred  dollars."  This  deed  was  placed  on 
record  February  12,  1884.  On  the  22d  day 
of  Jidy,  1884,  May  Clayson  exeL-uted  a  quit- 
claim deed  of  the  premises  to  Don  E.  Palmer. 
Tliis  was  acknowledged  before  a  notary  pub- 
lic in  Montcalm  county,  and  was  placed  on 
record  the  30th  dav  of  August,  1884.  On  the 
2d  day  of  Septenilier,  1884,  John  Q.  Wakely 
and  liis  wife  executed  a  quitclaim  deed  to  V. 
i5.  Fuce,  which  was  placed  on  record  Se[i- 
tember  3,  1884.  The  next  deed  is  dated  Oc- 
tober 22,  1884.  It  is  a  warranty  deed  from 
May  Clayson  to  Don  E.  Palmer,  and  contains 
the  clause  following:  "This  deed  is  executed 
and  delivered  1)V  first  party  for  the  purpose 
of  supplementing  and  ailding  to  a  quitclaim 
deed,  previously  given  by  first  parly  to  sec- 
ond party  heiein,  and  conveying  the  above 
premises,  and  adding  thereto  covenants  of 
title;  it  being  the  intention  of  the  (irst  party 
to  convey  to  second  party  all  the  title  1  had 
to  the  premises  at  the  lime  I  became  twenty- 
one  years  of  age,  and  to  expressly  revoke  all 
former  deeds  and  mortgages  made  by  me  be- 
fore I  became  twenty -one  years  of  age." 
This  deed  was  not  acknowledged  until  the 
4th  day  of  November,  1884,  before  a  notary 
public  of  JJrown  county,  teriitory  of  Dakota, 
and  was  [daced  of  re(H)rd  on  the  14th  of  No- 
vember, 1884.  The  only  proof  introduced 
on  the  part  of  the  defendant  was  his  title 
det'ds  from  May  Clayson,  and  testimony  t'Mid- 
ing  til  prove  her  age,  and  that  about  !n;30  of 
the  8900  loaned  was  used  in  jiaying  either  a 
store  account  or  note  of  Charles  D.  Clayson. 
The  second  deed  executed  by  May  Clayson  to 
defendant  Palmer  conveyed  no  title  or  inter- 
est in  the  land  whatever,  and  there  was  noth- 
ing to  which  the  covenants  of  warranty  could 
attacii.  As  independent  covenants  for  title 
they  were  woithless,  for  the  reason  that  the 
defendant  was  a  married  woman,  and  the 
coverumts  had  no  connection  with  any  sep- 
arate property  owned  by  her.  The  com- 
plainant showed  that  the  loan  was  obtained 
by  May  Clayson  to  take  up  and  discharge  the 


two  mortgages  that  were  valid  liens  upon 
her  property,  and  that  it  was  used  for  that 
purpose,  with  the  exception  of  a  few  dollars. 
Thearrangement  made  was  beneficial  to  May 
Clayson.  The  time  for  payment  was  extend- 
ed, and  the  interest  on  i^b()0  reduced  from  10 
to  7  per  cent.  The  money  was  loaned  Ijy  the 
complainant  in  good  faith,  and  upon  the  sun- 
position  that  May  Clayson  was  of  full  age. 
Mr.  Rogers,  the  agent  of  com[)lainaiit,  who 
made  the  loin,  testihes  that  to  appearance 
May  Clayson  was  at  tiiat  time  25  years  uld, 
and  he  got  the  impression  fmni  what  was 
said  and  done  that  she  was  then  of  full  age. 
When  the  defendant  obtained  his  quitclaim 
deed  from  May  Clayson  he  had  record  notice 
of  complainant's  mortgage,  and  that  it  ap- 
p  -.ired  to  be  the  tirstlieu  upon  the  land.  lie 
had  rei-ord  notice  that  th<'  legal  title  had  been 
conveyed  from  May  Claysou  to  Wakely  by 
warranty  deed  exir<ssly  made  subject  to 
complainant's  mortgage.  More  than  a  year 
had  elapsed  since  May  Claysun  had  attained 
her  ma,oi  ity,  aTid  by  no  word  or  act  had  she 
repudiated  or  revoked  the  mortgage  to  com- 
plainant, or  hei-  deed  to  Wakely.  Defendant 
Palmer  is  not  sworn  as  a  witness,  and  there 
is  nothing  in  this  record  which  shows  that  he 
ever  paid  a  dollar  consideration  lor  the  land 
in  question.  He  places  himself  upon  a  pure- 
ly legal  defense,  and  shows  himself  entitled 
to  no  equities  whatever.  The  claim  s.  t  up 
in  the  defense  tl  at  this  $9!j0  was  obtained, 
and  the  security  given,  to  pay  the  debts  of 
the  husband  of  May  Cla  s  n,  Ir  s  failed  sub- 
stantially, and  1  think  entirely.  It  is  true 
that  May  C.ayson  in  her  deposition  taken  in 
Dakota  says:  "The  mortgage  was  given  to 
secure  my  husbaiul's  indebtedness.  Part  of 
the  money  obtained  on  that  mortgage  went 
to  pay  off  a  first  mortgage,  and  the  balance 
went  to  pay  other  indebiedness  of  my  hus- 
band." i>ut  the  proof  is  satisfactory  that 
she  is  m  staken.  The  money  was  not  ob- 
tained to  pay  her  husband's  indebtedness, 
but  to  pay  off  incumbrances  on  her  j)roperly. 
That  siie  represented  that  to  be  the  puri)ose 
when  she  obtained  the  loan,  and  that  all  but 
a  very  small  fraction  was  then  and  there  ap- 
plied to  that  pur[)ose.  More  unsatisfactory 
is  the  testimony  of  E.  Barrett  and  Mr.  Hock- 
afellow.  Barrett  is  askC'l  if  he  knows  any- 
thing about  what  was  done  with  the  money 
that  was  borrowed  of  J^ir.  Rogers,  the  wit- 
ness spoken  of,  and  he  replies:  "Well,  I 
think  it  went  to  Mr.  Rockafellow,— what  she 
owed  him.  I  suppose  it  was  a  family  debt.  I 
don't  know  whether  hi-r  contracts  or  his  con- 
tracts,— store  bills.  He  kept  a  store  there  at 
that  time."  Mr.  Rockafellow  is  asked  if  he 
recollected  the  transaction  of  the  giving  the 
moitgage  to  Langdon,  and  if  he  knows  any- 
tiiing  about  what  was  done  with  the  balance 
of  this  money  spoken  of.  He  testified  that 
part  of  it  was  j)aid  to  him, — that  he  ditl  not 
remember  the  amount, — for  a  note  he  held 
against  Charles  Clayson.  He  could  not  say 
positively.  He  had  quite  a  good  deal  to  do  with 
Clavson,  and  he  thought  the  note  was  foi'  a 


INFANTS. 


39 


lioise,  and  tliought  it  was  somewhere  in  tiie 
neighlioiiiood  of  $25  to  $30.  Tliat  he  knows 
where  he  got  the  money  because  he  (llocUa- 
I'ellow)  tried  to  make  a  loan  for  tlicni  to  an- 
other party  before  that  one.  Tiiey  wanted 
to  get  the  money  partly  to  pay  off  the  mort- 
gages and  partly  to  pay  him.  They  owed 
him  a  store  account  besides  the  note.  Kog- 
ers  testified  that  they  computed  the  amount 
due  upon  the  mortgage  indebtedness,  and  it 
came  to  nearly  $'J00,  and  they  said  they 
would  take  .$900.  There  was  a  small  bal- 
ance over,  probably  one  or  two  dollars. 
Wiiatever  it  was,  was  paid  to  May  Clayson, 
and  he  does  not  know  wliat  was  done  with 
it.  1  do  not  tliink  that  this  small  balance, 
whether  !$1  or  .$80,  that  was  paid  to  Mrs. 
Clayson  alter  paying  the  mortgages,  has  any- 
thing to  do  with  the  validity  of  the  mortgage 
in  (jnestion. 

It  is  evident  that  the  object  and  purpose 
of  making  the  loan  of  Mr.  Lani^don  was  to 
pay  off  and  discliarge  the  existing  incum- 
brances upon  May  Clayson's  land,  and  to 
substitute  the  lien  of  the  I/mgdon  mortgage 
for  those,  and  ol)tain  a  longer  time  for  pay- 
ment at  a  lower  rate  of  interest.  Upon  wliat 
principle  of  equity  or  justice  can  the  validity 
of  this  mortgage  be  attacked  and  set  aside  as 
invalid?  The  infant  was  by  her  own  oath 
then  nearly  20  years  of  age.  More  than  a 
year  previously  she  had  purchased  this  land, 
and  taken  the  title  in  lier  own  name,  subject 
to  the  incumbrances  which  she  assumed  and 
agreed  to  pay  as  part  of  the  purchase  price. 
She  lias  never  refiudiated  this  transaction, 
but  has  ratified  and  attirmed  it  after  her  ma- 
jority by  dealing  with  the  title  she  thus  ac- 
quired as  owner.  She  could  not  ratify  the 
purchase  without  ratifying  the  agreement  to 
pay  the  existing  liens  as  part  of  the  purchase 
money,  nor  without  ratifying  the  manner  in 
which  she  dealt  with  those  liens.  She  vol- 
untarily sought  complainant,  and  borrowed 
the  u)oney  from  him  to  pay  off  these  incum- 
brances by  placing  another  upon  the  prem- 
ises.    By  this  she  only  shifted  her  obligation 


to  pay  Itopp  and  liich  to  pay  the  same  pur- 
chase price  to  complainant.  She  is  not 
harmed  by  this  transaction,  but  is  benelited. 

While  tliere  is  no  absolute  time  in  which 
an  infant  must  act  after  he  has  arrived  at 
the  age  of  21  to  prevent  the  presumption  of 
ratilication  arising  from  lapse  of  time,  ami 
while  courts  will  not  be  curious  to  inquire 
whether  the  act  was  benelicia!  or  not.  or  oth- 
erwise, or  stringent  in  applying  the  rule  that 
he  must  act  in  a  reasonable  time  when  it  is 
proper  to  protect  his  rights,  yet  when  he 
has  a  right  to  repudiate  a  transaction  in 
which  he  has  not  been  defrauded  or  over- 
reached, and  where  he  has  received  and  re- 
tained the  benelit  of  the  transaction,  he 
must  act  with  reasonable  promptness,  or  he 
will  be  deemed  to  have  ratified  the  act  by  ac- 
quiescence. 

Under  the  facts  of  this  case,  iiulependent- 
ly  of  other  considerations  under  which  this 
mortgage  must  be  treated  and  held  as  a  valid 
secuiity,  a  right-minded  person  never  wouhl 
have  attempted  to  repudiate  the  mortgage 
executed  for  the  purpose  and  under  the  cir- 
cumstances of  this  case,  and,  after  the  lapse 
of  more  than  one  year  after  she  reached  ma- 
jority, she  will,  in  aid  of  justice  and  equity, 
and  to  prevent  fraud,  be  deemed  to  have  in- 
tended to  ratify  the  trai\saction  by  her  si- 
lence and  ac(|uiescence.  It  would  be  a  re- 
proach upon  the  administration  of  justice  if 
a  scheme  so  inequitable  and  unconscionable 
as  tiiis  appears  to  be  from  the  record  should 
succeed.  Courts  of  equity  will  always  view 
with  special  favoi',  and  guard  with  jealous 
care,  tlie  rights  of  infants,  but  they  will  not 
lend  their  aid  to  intants,  or  those  wlu)  en- 
trench themselves  behind  them,  to  perpetrate 
wrong  upon  innocent  parties,  or  aid  in  de- 
priving such  parties  of  their  just  lights. 
The  decree  of  the  circuit  court  is  honest,  and 
should  be  attirmed. 

SHERWOOD,  C.  J.,  CAMPBELL  and 
MORSE,  JJ.,  concurred.  LONG,  J.,  did 
not  sit. 


40 


INFANTS. 


TYLIOR  V.  GALLOP'S  ESTATE. 

(35  N.  W.  902.  G8  Mich.  185.) 

Supremo  Court  of  Michigan.      Jan.  12,  1888. 

Error  to  circuit  court,  Chuv  county;  Henry 
Hart,  ,lu(l;j;e. 

Action  by  Jt.  Smith  Tyler  again.st  Joliu 
Flcniin.i;-,  administrator  of  the  estate  of 
Franlvlin  (hiHop,  upon  a  note  executed  by  the 
deceased  during;  liis  lifetime.  There  was  a 
verdict  and  Judgment  for  phiintift,  and  de- 
fendant l)rinj;s  error.      Reversed. 

C.  W.  I'erry,  for  appellnnt.  Browne  iK:  Cum- 
mins, for  appellee. 

MORSE,  J.  The  plaintifl'  presented  a  claim 
against  the  estate  of  Franklin  Gallop,  deceas- 
ed, based  upon  a  promissory  note  for  $110, 
dated  August  22,  1882,  payable  in  one  year 
from  date,  with  interest  at  10  per  cent.  The 
note  was  signed  by  William  Gallop  and 
Frank  Gallop,  (the  deceased,)  as  makers.  The 
I'laim  was  disallowed  by  the  commissioners. 
Plaintilf  appealed  to  the  circuit  court  for  the 
county  of  Clare.  Upon  the  trial  in  that  court, 
testimony  was  given  on  behalf  of  the  defend- 
ant tending  to  show  that  the  note  in  question 
was  given  in  place  of  another  note  made  by 
Daniel  Gallop,  and  also  signed  by  William 
(iallop,  to  plaintiff;  and  that  said  Daniel 
Gallup  had  offered  to  pay  the  tirst  or  original 
note  given  by  him  to  plaintiff,  and  had  al- 
ways been  ready  and  willing  to  pa.v  the  same 
at  any  time,  but  said  plaintiff'  had  never  of- 
fered to  deliver  said  original  note  up  to  Dan- 
iel; and  that  said  note  was  past  due  when 
the  note  in  suit  was  executed.  And  fiu'ther 
evidence  was  given  on  the  part  of  defendant 
tending  to  show  that  at  the  time  this  note  was 
made,  Franklin  (xailop  was  a  minor,  and  had 
never  been  emancipated  by  his  father,  the 
said  Daniel  Gallop,  and  that  the  contract  con- 
tained in  said  note  had  never  been  ratitied  b.v 
Frank  after  attaining  his  majority;  that  Dau- 
itl  had  no  knowledge  of  the  note  in  suit  being 
given  to  take  up  the  original  note.  In  re- 
liuttal.  the  plaintiff'  introduced  testimony 
tending  to  show  that,  when  the  note  niaile  by 
Frank  and  William  was  received  by  him,  the 
original  note  was  delivered  over  to  them,  and 
that  it  was  not  in  his  possession  at  the  tiuie 
of  the  tiial,  and  never  had  been  since  the  note 
in  suit  was  executed  and  delivered  to  him. 
Also  evidence  tending  to  prove  that,  at  the 
time  the  note  in  question  here  was  given,  the 
deceased,  Franklin  Gallop,  had  been  eman- 
cipated, and  was  doing  business  in  his  own 
name  for  his  own  benefit,  with  the  consent 
and  ai)]iroval  of  his  father,  and  that  Daniel 
authorized  Frank  to  take  up  the  original  note, 
and,  at  the  time,  Frank  and  William  were  in 
partnership,  and  the  said  note  was  given  iu 
the  course  of  their  partnership  transaction. 
The  circuit  .judge  instructed  the  .iury,  in  sub- 
stance and  effect,  that  tlie  deceased  failing  to 


givi'  notice  to  the  plaintiff'  during  his  life- 
time, after  he  became  of  age,  (he  haA  ing  lived 
.some  two  years  after  he  became  twenty-one 
years  of  age,)  that  he  could  not  and  would  not 
1)<>  boinid  by  his  signature  to  said  note,  his  le- 
gal representatives  after  his  death  could  not 
take  advantage  of  his  silence  without  ottering 
some  proof,  at  least,  that  the  deceased  did 
not  intend  to  be  bound  by  his  contiact:  and 
directed  a  verdict  for  the  plaintiff'  for  the  face 
of  the  note  and  interest. 

The  judgment  entry  in  the  circuit  court  is 
not  correct,  or  applicable  to  proceedings  of 
this  kind.  No  error  is  assigned  upon  it,  but 
a  commou-laAV  judgment  cannot  run  against 
the  administrator,  or  against  the  property  in 
his  hands  as  such,  as  it  does  in  this  case.  The 
entry  should  be  an  allowance  or  disallowance 
of  the  claim,  which  allowance  or  disallow- 
ance is  to  be  certified  to  the  probate  court. 
See  La  Roe  v.  Freeland,  8  Mich.  031-534. 

The  only  errors  assigned  in  the  record  are 
to  the  charge  of  the  court.  We  think  the 
case  should  have  been  submitted  to  the  jury. 
If  the  deceased  was  a  minor  at  the  time  of  the 
execution  of  this  note,  the  burden  of  proof 
was  upon  the  plaintiff'  to  show  that  he  had 
ratilied  it  after  he  attained  his  majority.  It 
seems  from  the  record  that  there  was  evi- 
dence tending  to  prove  that  deceased  had  not 
ratified  the  contract.  The  circuit  judge  was 
not  authorized  iu  law  to  presume  a  ratitica- 
tion  because  of  the  mere  silence  of  the  de- 
ceased for  two  years.  There  must  have  been 
an  express  promise  after  he  became  of  age, 
or  such  acts  as  would  have  been  eciuivalent 
to  a  new  contract.  Goodsell  v.  Myers.  3 
Wend.  470;  Wilcox  v.  Roath,  12  Conn.  5,50; 
Tucker  v.  Moreland,  10  I'et.  .58;  Ford  v.  I'hil- 
lips.  1  I'ick.  202;  Fetrow  v.  Wiseman.  40  ind. 
148;  Tyler,  Inf.  (2d  Ed.)  84-92;  Miuock  v. 
Shortridge.  21  Mich.  304;  I'rout  v.  Wiley,  28 
Mich.  1(J4. 

The  record  iu  this  case  is  blind  and  uncer- 
tain. It  appears  that  there  was  evidence 
tending  to  show  that  the  original  note  was  de- 
livered over  to  William  Gallop  and  the  de- 
ceased, but  which  one  of  them  took  and  kept 
possession  of  it  we  are  not  informed;  nor 
does  it  appear  whether  the  relation  of  the  de- 
ceased to  the  note  sued  upon  was  that  of 
maker  or  surety  for  William.  We  do  not  pro- 
pose, therefore,  to  discuss  what  might  be  the 
law  applicable  to  facts  which  may  not  be 
facts  in  the  case. 

The  (luestion  whether  or  not  the  deceased 
was  emancipated  by  his  father  at  the  time  he 
signed  this  note  had  no  relevancy  to  the  is- 
sue. It  could  not  affect  his  liability  upon  this 
note. 

The  judgment  of  the  coiu't  lielow  is  reverse«l. 
and  a  new  trial  granted,  with  costs  of  this 
court  to  defendant. 

CHA.MI'LIN  and  SHERWOOD.  .T.T.,  concur- 
red.     CAMl'KELL,  C.  .1..  did  not  sit. 


INFANTS. 


41 


DURFEE  V.  ABBOTT  ot  al. 

(28  N.  W.  521,  Gl  Mich.  471.) 

Supiome  Court  of  Michigan.      Juno  10,  188G. 

EiTor  to  circuit  court,  Wayne  county. 

Alex.  D.  P^'owler,  for  niipclhiiits.  Frascr  & 
(latcs.  for  appellee. 

CHAMPLIN,  J.  This  suit  is  hroufiht  upon 
a  residuary  legatee's  1)on(l  to  recover  a  le.tiacy 
given  by  Ihe  last  will  "and  testament  of  .Toliii 
T.  McKeown,  deceased,  to  Kate  I^antz.  The 
case  was  before  this  court  at  the  April  term, 
188.'?,  and  is  reported  in  ">()  Mich.  479,  ir>  N. 
W.  5.j!).  Sophia  Lautz,  who  was  one  of  the 
legatees  for  whose  use  the  suit  was  then  prose- 
cuted, has  since  dropped  out  of  the  case  as  a 
part.v  ln<"erestfd.  Under  the  facts  as  they  ap- 
peared in  the  record  iM^fore  the  court,  she  had 
no  I'iglit  to  recover. 

it  appeared,  as  it  now  ai)pcars,  that  on  Oc- 
tober 20.  1.S77.  the  executor  gave  to  these  lega- 
tees his  individual  notes  for  the  legacies,  pay- 
able to  them  two  .years  from  that  date,  with 
interest.  The  legacies  were  payable  when  the 
uotes  were  given,  and  they  signed  and  gave  to 
the  executor  receipts,  stating  that  tluw  had  re- 
ceived from  the  executor  of  the  estate  of  John 
T.  McKeown.  deceased,  .$250,  being  the  legacy 
bequeathed  to  them,  respectivel.y.  It  was  held 
that,  by  this  extension  of  the  time  of  payment 
without  the  sureties'  assent,  they  were  dis- 
charged fi-om  liability.  But  it  also  appeared- 
that  Kate  Lantz  was  not  21  years  of  age  at 
the  time  the  note  to  her  was  given,  and  there- 
fore she  stood  in  a  different  position;  that  she 
had  no  power  to  extend  the  time  for  payment, 
and  she  did  not  become  of  age  until  after 
the  note  giveu  her  became  due.  and  unless  she 
did  some  act,  after  she  came  of  age,  extend- 
ing the  time,  or  in  some  other  way  changing 
McKeowu's  liability,  she  is  not  barred  of  her 
action;  and,  iuasnuich  as  the  note  in  her  hands 
was  past  due  when  she  came  of  age,  the  time 
was  not  extended  by  her  retaining  the  note. 
and  that  it  should  not  be  held  as  payment  until 
so  treated  in  fact. 

It  will  readily  be  seen  that  tlie  contest  upon 
the  retrial  centered  upon  the  question  of  the 
age  of  Kate  Lantz.  On  the  part  of  the  plain- 
tiff, Kate  Lantz  testitied  that  she  was  born 
November  5,  1S58.  and  that  her  full  name  is 
Catherine  Sophia  Barbara  Lantz:  tluit  her 
father's  name  is  Jacob  Lantz.  and  lier  mother's 
Barbara  Lantz;  and  that  lier  [)ai'ents  lived  on 
Clinton  street,  in  Detroit,  when  she  was  born. 
Sophia  Smith,  a  sister,  testitied  that  Kate  was 
born  in  IS.'S.  Caroline  M.  Lantz.  another  sis- 
ter, testitied  that  Kate  was  born  in  1858,  aud 
that  her  birthday  was  November  5th.  She 
stated,  that  she  had  seen  the  entry  in  the  fami- 
ly record  made  in  the  family  Bible,  aud  had 
last  seen  it  seven  or  eight  .years  ago;  that 
the  entry  read,  "Sophia  Catherine  Barl)ara 
Lantz,  born  18.58;"  that  the  record  of  her  own 
birth  was  entered  there,  and  read,  "Caroline 
Matilda  Lantz,  born  in  18.5(5;"  aud  that  the 
entry    of    the    birth    of    Sophia    read,    "Sopliia 


Catlieiine  Lautz.  1.S4!)."  .Mrs.  H:irliara  I>antz, 
the  mother,  was  sworn  for  plaintiff',  and  testi- 
fied tliat  her  age  was  ^5,  and  was  not  alile  to 
renieml)er  the  age  of  her  daughters  except  the 
eldest;  that  tliey  had  a  family  record  in  the 
Bible,  l)ut  lier  liusl)and  took  it  away  wi:]i 
him,  and  she  had  not  seen  it  since.  She  states 
that  slie  was  married  in  1S4!»,  and  four  of  her 
ciiildnni  were  liaptiseil  on  Clinton  street,  by 
the  itastor  of  the  (Jerman  Lutheran  Church  on 
Monroe  avenue;  lliat  Kate  was  baptised  by 
the  name  of  Catlieiine  So[)hia  Barbara  I^nitz. 
She  first  stated  that  the  miuister's  name  was 
Herman  wlio  ba|)tised  all  four  of  the  children, 
but  afterwards  recalled  the  fact  that  one  was 
baptised  liy  a  minister  by  the  name  of  Mill>'r. 
of  the  Monroe  Avenue  Church;  that  she  was 
present  when  Kate  was  liaptised,  as  was  also 
Peter  Lantz,  his  wife,  Sophia  Lantz,  and  Cath- 
erine Schelard.  Tlie  defendants,  on  their  part, 
produced  Charles  Haas,  tiie  pastor  of  the  <Jer- 
maii  Lutlieian  Clinrcii,  who  t<'stified  who  were 
pastors  of  the  cliurch  from  1S.52  to  18ft2,  among 
whom  was  Rev.  Mr.  Miller.  He  also  produ- 
ced and  proved  the  church  records  of  l)aptism 
from  18.52,  and  since,  which  record  showed  the 
"baptism  of  Catherine  Sophia  Barbara  I.,antz, 
daughter  of  .Jacob  and  Barbara  Lantz,  born 
the  eiglileenth  da.v  of  Novemlier,  185(i,  and 
baptised  the  fifteenth  day  of  Miuvh,  1S57. 
The  witnesses  were  S<3phia  Lantz.  Catheriue 
Schelard.  aud  Peter  Ijjintz."  This  entry  the 
witness  testified  was  in  tlie  liaiid writing  of 
Heruian  ^Miller,  who  was  pastor  of  the  church 
at  tliat  time.  The  entry  appears  in  the  reg.i- 
lar  order  of  dates.  One  date  follows  anotlicr 
in  regular  order,  and  tlie  entries  are  number.';! 
consecutively,  and  the  number  of  the  entrv 
read  was  No.  28,  and  appears  under  date  of 
March  15.  1857;  the  prior  date  being  March  S, 
and  the  subse<iuent  date  lieing  Marcli  10,  1857. 
The  witness  testified  that  these  records  belong 
to  the  church,  and  that  he  has  been  its  pastor 
since  1802.  There  was  some  evidence  intro- 
duced showing  what  Kate  T-antz  and  Sophia, 
her  sister,  testified  about  Kate's  age  upon  that 
trial,  to  the  ett'ect  that  she  was  born  in  No- 
vember. 1857. 

This  record  respecting  tlie  baiitisni  of  Cath- 
erine Sophia  Barliara  I^uitz  was  admitted  in 
evidence  without  objection.  It  is  too  late  now 
for  counsel  for  plaintiff"  to  claim  tliat  it  was 
incompetent  evidence,  or  that  it  was  necessary 
to  show  that  Mr.  Miller  was  dead  before  it 
could  be  receivt'd.  It  was  iiecess;iry.  liowever, 
that  the  defendant  should  prove  the  identit>- 
of  the  person  baptised  as  Cathi>rine  Sophia 
Barbara  Lautz  with  the  legatee  known  as 
Kate  L;tutz,  and  it  was  necessaiy  for  the 
.liny  to  l)e  convinced  of  tliat  fact.  It  was 
therefore  error  for  the  court  to  refuse  to  sub- 
mit to  the  .iur.v  the  special  (luestion.  as  fol- 
lows: "Is  the  'Catherine  Soiihia  Barbara 
Ijantz'  named  in  the  records  of  baptism  pro- 
duced by  Rev.  Charles  Haas,  as  having  been 
'born  November  18.  18.5(),  and  baptised  on 
March  15,  1857,'  the  same  person  who  prose- 
cutes  this    suit   as  plaintiff',   aud    who    swears 


42 


INFANTS. 


that  her  fiill  name  is  Catherine  Sophia  Barbara 
I^antz?"  Draycot  v.  Draycott,  12  Vin.  Abr. 
-89;    Rlrt  v.  Barlow,  1  Doug.  170. 

Error  is  assigned  upon  tlie  refusal  of  rho 
■court  to  charge  the  .juiy  that,  if  they  believed 
that  the  record  of  l)aptisni  is  true,  their  verdict 
must  be  for  the  defendant.  The  court  charged 
that  the  record  was  not  conc^lusive  evidence 
of  tlie  facts  appearing  in  it.  but  it  was  evidence 
to  go  to  the  jur.v  under  all  the  circumstances, 
.and  it  was  for  them  to  give  to  it  what  weiglit 
they  saw  fit;  and,  after  considering  all  tlie 
facts,  if  the.v  believed  the  record  of  tlie  minis- 
ter was  true,  it  would  sliow  the  girl  was  of 
age,  and  therefore  the  plaintiff  could  not  re- 
cover. We  do  not  tliiuk  the  defendants  can 
•conii)laiu  of  this  instniction.  The  record  of  the 
baptism,  when  admissible  in  evidence,  is  evi- 
dence of  the  date  of  baptism,  but  not  of  birth, 
iiltliough  stated  therein,  (Wihen  v.  Law,  3 
Staikie.  (io;  Duins  v.  Donovan,  o  Hagg.  Kce. 
501;  Burghart  v.  Angerstein,  (i  Car.  &  P.  USJO; 
Rex  V.  Clapham.  i  Car.  &  V.  20;  Rex  v.  North 
Petherton,  5  Barn.  &  C.  ".OS:)  and  the  date  of 
baptism  was  equally  as  important  to  defend- 
.ants  as  that  of  the  birth;  for,  if  she  was  the 
person  baptised  on  the  fifteenth  of  Marcli, 
1S.")7.  she  would  be  21  years  of  age  before  the 
note  matured  in  October,  1870. 

Defendant's  counsel  also  requested  the  court 
to  charge  the  juiy  that  if  they  found  from  the 
evidence  that  Kate  I^ntz  gave  John  ilc- 
Keown,  executor  of  the  estate  of  John  T.  Mc- 
Keown,  a  receipt  dated  Octolier  20.  1877,  for 
lier  legac.v,  and  at  or  about  the  same  time  re- 
ceived his  individual  note  for  said  legac.v  paya- 
ble October  20,  1879,  and  kept  said  note  two 
years  after  she  became  of  age,  this  was  such 
.an  extension  of  time,  without  the  consent  of 
the  sureties  on  McKeown's  liond,  as  would 
discharge  them  from  all  liability;  and  their 
verdict  must  be  for  the  defendants  Abbott  and 
Fowler.  And  he  further  requested  the  court 
to  charge  that  when  a  minor  holds  a  note  a 
long  time  after  she  becomes  of  age,  aad  does 
not  disaffirm  the  contract,  she  being  the  acti^-e 
party,  she  is  considered  in  law  as  ratifying 
the  contract,  and  also  that,  if  the  juiy  should 
find  that  Kate  Lantz  became  of  age  before  the 
note  became  due,  (October  20,  1879.)  they 
must  find  for  the  defendants  Abbott  and  Fow- 
ler; and  in  that  case  it  did  not  matter  when 
the  note  was  given. 

Tliese  requests  do  not  state  the  correct  prin- 
ciples of  law  to  be  applied  to  the  facts  of 
this  case.  Under  any  view  of  the  testimony. 
Kate  Lantz  was  not  of  full  age  wlien  the  note 
was  made,  and  the  receipt  given.  She  was 
then  incapalile  of  giving  sucli  binding  assent 
to  an  extension  of  time  as  would  discliarge 
the  sureties,  or  of  receiving  the  individual  note 
of  the  executor  in  absolute  payment  of  the 
legacy.  The  question,  tiierefore,  is,  did  she, 
after  she  became  of  age,  ratify  the  arrange- 
ment by  which  the  note  was  given?     If  she 


did,  the  ratification  would  relate  l)ack  to  the 
time  of  the  transaction,  and  .so  affect  the  un- 
dertaking of  the  sureties  as  to  discharge  them 
from  liability.  Ratification  always  resolves 
itself  into  a  question  of  intention.  The  ques- 
tion, therefore,  for  tlie  juiy  to  determine  was 
whether  the  facts  were  such  as  to  .justify  an 
inference,  properly  to  be  drawn  fiom  them, 
of  an  intent  on  the  part  of  Kate  Lantz  to  rat- 
ify tlie  reception  of  the  note  as  payment  of  her 
lega(y.  Where  no  express  ratification  is  shown, 
and  no  act  done  in  reliance  upon  or  in  affirm- 
ance of  the  contract  entered  into  by  an  infant, 
mere  delay  in  proceeding  to  enforce  her  claim 
against  the  sureties  cannot  be  construed  into  a 
ratification  where  there  are  no  elements  of  es- 
toppel tliat  intervene;  especiall.y  where  the  in- 
fant has  not  received  any  new  consideration 
nor  retains  any  consideration  arising  out  of  the 
original  transaction.  In  this  case  McKeown's 
note  ;lid  not  give  her  any  greater  right  of  ac- 
tion against  him  than  she  had  before.  She 
was  relin(iuisliing  a  .security  which  she  had 
under  the  bond  against  the  sureties,  and  re- 
ceiving in  Its  stead  a  negotiable  note  in  which 
the  day  of  ])ayment  was  deferred.  This,  per- 
haps, would  liave  been  a  sufficient  considera- 
tion Ixnween  parties  capable  of  contracting; 
and,  had  she  been  of  age,  it  certainly  would 
have  been  sufficient  to  discharge  the  sureties 
in  the  l)ond,  if  made  without  their  assent  or 
approval.  There  is  some  testimony  from 
which  the  knowledge,  if  not  the  assent,  of  at 
least  one  of  the  sureties  might  be  inferred. 
It  was  proven  that  l)oth  the  receipt  and  note 
were  in  the  handwriting  of  one  of  the  sure- 
ties, but,  as  this  point  was  not  made  promi- 
nent, and  was  not  relied  upon,  it  need  not  be 
discussed  now. 

So  far  as  the  contract  which  was  made  be- 
tween :McKeown,  the  executor,  and  Kate 
Lantz  affected  the  residuary  legatee's  bond, 
it  was  an  executed  contract,  and  it  has  been 
held  that,  in  order  to  confirm  an  executed  con- 
tract of  an  infant,  all  that  appears  to  be  neces- 
sary is  to  show  any  distinct  acknowledgment 
or  act  indicating  an  intention  to  be  bound  liy 
the  contract;  and  if  the  infant  continues,  after 
coming  of  full  age,  to  occupy  a  position  which 
is  only  explicable  upon  the  supposition  that  he 
intends  to  stand  b.v  his  contract,  it  will  be  con- 
sidered as  a  ratification  of  an  executed  con- 
tract. 1  Story,  Cont.  (4th  I-:d.)  §§  09.  72;  Ty- 
ler, Inf.  &  Cov.  §§  40,  41;  Norris  v.  Vance. 
3  Rich.  Law,  1G8.  But,  whether  the  contract 
be  executed  or  executory,  the  question  as  to 
what  acts  will  or  will  not  amount  to  a  con- 
firmation is  one  of  intention,  and  is  one  prop- 
er to  be  submitted  to  and  determined  by  a 
juty  under  proper  instructions  from  the  court. 

The  judgment  must  be  reversed,  and  a  new- 
trial  granted. 

CAMPBELL,  C.  J.,  and  SHERWOOD.  J., 
concurred. 


INFANTS. 


4:j 


HEATH    V.    STE\  I:NS. 

(48  N.  H.  2ol.) 

Supreme  Court  of  New   Hampshire.      Grafton. 
Jau.,  18(i*J. 

lu  this  case  the  parties  agi'ee  iipou  the  fol- 
lowing statement  of  facts,  reservinj;  to  each 
the  right  to  go  to  the  jury  upon  anything  agreerl 
to  in  this  statement: 

About  the  1st  of  April,  A.  D.  isir,.  the 
plaintiff.  Daniel  C.  Heath,  went  from  his  home 
in  Daubuiy.  in  this  coimtj-.  to  White  River 
.function,  for  the  purpose  of  enlisting,  in  com- 
pany with  several  others,  and  was  reje<-te<l. 
and  while  there  this  plaintiff  met  the  defend- 
nnt.  who  had  just  rettmied  from  New  York, 
and  the  defendau:  told  the  plaintiff  what  boun- 
ties were  being  paid  in  that  state,  and  that 
they  were  much  largei  than  at  White  River 
Junction.  The  plaintiff  then  informed  the  de- 
fendant that  if  he  (the  defendant)  would  pay 
his  car  fare  out  to  New  York,  he  would  give 
him  $200  out  of  his  bounty,  if  he  was  accepted: 
if  he  was  not  accepted,  the  defendant  was  to 
pay  the  plaintiff's  fare  back.  The  defendant 
did  not  ask  or  request  the  plaintiff  to  go.  but 
the  plaintiff  did  50  with  the  defendant  under 
the  aforesaid  agreement,  enlisted  for  three 
years,  and  got  $700  bounty,  and  paid  the  de- 
fendant .$20n.  the  defendant  paying  the  plain- 
tiff's expenses  to  New  Y'ork.  The  plaintiff 
served  some  five  months,  and  returued  home. 

At  the  time  when  the  plaintiff  went  to  New- 
York  with  the  defendant,  and  at  the  time  when 
he  made  the  aforesaid  agreement,  he  was  not 
"21  years  of  age.  After  the  plaintiff"  retiu-ued 
home,  he  brought  this  suit  to  recover  of  the 
defendant  the  said  .^^(Xi,  which  he  had  paid  as 
aforesaid.  Now.  if  the  court  shall  be  of  the 
oiHulon  that,  upon  the  foregoing  state  of  facts, 
the  plaintiff  can  recover,  then  there  is  to  be 
judgment  for  the  pLiintift'  for  that  sum  and 
for  costs:  otherwise  for  the  defendant  for 
<*osts. 

Lord  &  Sulluwav.  for  plaintiff'.  Mr.  Muiiay, 
for  defendant. 

TERLEY.  C.  J.  The  plaintiff"  was  not  le- 
gally bound  to  perform  his  contract,  made 
while  he  was  an  infant;  but  he  voluntarily 
l)erformed  it  l>efore  he  b<Hame  of  age;  and  he 
is  not  here  defending  an  action  brought  to  en- 
force the  contract,  but  he  seeks  to  recover  back 
money  which  he  paid  while  under  age  in  exe- 
cution of  the  contract.  Two  objections  are 
uvade  to  his  right  of  recovery: 

(1)  That  money  paid  by  an  infant  in  execu- 
tion of  his  voidable  contract  cannot  be  rec-ov- 
fretl  back. 

(2)  That  the  plaintiff"  must  first  restore  what 
he  received  imder  the  contract  before  he  can  re- 
scind it.  and  rec-over  V>ack  the  money  he  paid 
in  execution  of  the  contiact. 

On  the  first  of  these  points  the  dec-isious  have 
not  l^een  unanimous.  In  Holman  v.  Blo.gg.  S 
Taunt.  ."'•O  -,  it  was  held  tluit.  if  an  infant  pays 
luonev  with  liis  own  hands  without  a  valuable 


consideration,  he  cannot  get  it  back  again; 
and  where  an  infant  paid  money  to  A.  as  a 
premium  for  a  lease,  and  enjoyed  the  same  for 
a  short  pericjd  during  his  infancy,  but  avoided 
it  after  lie  became  of  age.  it  was  decided  in 
the  s;ime  vnse  that  he  could  not  re<f)ver  the 
sum  so  paid  in  an  action  for  money  had  and 
received  against  A.  The  doctrine  of  Holman 
V.  Klogg  was  followed  in  McCoy  v.  Hoffman.  8 
Cow.  S4,  iu  which  <..ise  it  was  hel<l  that  where 
an  infant  iierfonns  work  in  jtaymeut  of  his 
contract,  or  i)ays  'iioney  on  his  contract,  he 
cannot,  by  avoiding  his  contract,  get  back  the 
money,  or  recover  compensation  for  his  lalwr. 
And  in  our  case  of  Weeks  v.  Leighton,  .">  N.  H. 
348.  it  was  held,  on  the  authority  of  Holman 
V.  Blogg  and  McCoy  v.  HotTnian,  that  when  an 
infant  rescinds  his  contract  on  the  ground  of 
his  infancy,  he  is  not  entilled  to  recover  any 
compensjitiou  for  lalK)r  he  may  iKive  i)erfonned 
under  it. 

Wei'ks  V.  Leighton  was  directly  overruli-il  in 
Lufkin  V.  Mayall.  'Jo  N.  H.  8:3;  and  the  later 
c-ase  of  Locke  v.  Smith.  41  N.  H.  34ij.  is  al.so 
to  the  point  that  an  infant  may  recover  for 
what  he  lias  done  or  paid  under  an  executed 
contract,  provided  he  restore,  or  account  for. 
what  he  has  received  under  the  contract.  Mc- 
Coy V.  Hoffman  has  been  overruled  in  New 
York  (Milliard  v.  Hewlett.  10  Wend.  301 ;  Med- 
btuy  V.  Watrous.  7  Hill.  110);  and  Holman  v. 
Blogg  was  questioned  and  evaded,  if  not  di- 
rec-tly  overruled  in  Corpe  v.  Overton,  in  Biug. 
2.32.  The  authorities  are  numerous  in  other 
jurisdictions  that  an  infant,  upon  rescinding 
an  executed  contract,  may  recover  for  what  he 
has  done  or  paid  under  it.  provided  he  restore, 
or  account  for.  what  he  has  received  mider  the 
contract.  Moses  v.  Steven.s.  2  Pick.  332 ;  \'ent 
V.  Osgood.  10  Pick.  .■i72;  .ludkins  v.  Walker, 
17  Me.  :!.S:  Thomas  v.  Dyke.  11  \t.  272;  Taft 
V.  Pike.  14  Vt.  50.");  Hill  v.  Anderson,  o 
Smedes  &  M.  21(j;  Tipton.  3  .Tones.  Law.  5.">2. 
And  the  (piestions  must  be  considered  as  set- 
tled in  this  state  by  the  recent  cases  of  Lufkin 
V.  Mayall  :uid  Locke  v    Smith. 

It  is  now  extremely  well  settled  that,  if  an 
infant  would  re.-^cind  his  voidable  contract,  and 
recover  bac-k  what  he  has  paid  under  it.  or 
compensation  for  what  he  has  done  under  it. 
he  nuist  fii-st  restore  the  thing  that  he  has  re- 
eeiveil  under  the  contract,  if  it  remain  in 
si^ecie.  and  within  his  control;  or.  if  not.  must 
account  for  the  value  of  it.  But  if  what  he 
has  received  has  been  consunu^l.  or  for  any 
other  cause  cannot  be  returned  in  spcnie.  he 
may  recover  for  what  he  i)aid  or  did  under 
the  contract  by  deducting  what  he  received,  or 
the  value  of  it,  from  the  amount  that  he  paid, 
or  from  the  value  of  the  services  which  he 
rendered.  Thus  in  Loc-ke  v.  Smith.  41  N.  H. 
340,  the  infant  agreed  to  work  for  his  iKrnrd, 
and  it  was  held  tluit  he  might  avoid  the  con- 
tract, and  recover  for  his  work  what  it  was 
worth,  though  he  could  not  restore  what  he  had 
received;  but  that  he  must  allow  by  way  of 
deduction  whatever  his  board  was  worth. 
"The   inf.-uit    cannot."   say   the   court,    "reim- 


41 


INFANTS. 


(liatf  tilt'  coiiinur  so  .is  Id  n'(\)ver  f'oi-  his  la- 
bor, aud  allow  nothinii  for  his  board."  When* 
the  contract  of  the  infant  was  executed  befoi'e 
he  became  of  ajre.  and  the  natiu'e  of  the  case 
Is  .such  that  he  cannot  restore  in  specie  what 
he  received  under  the  contract,  this  does  not 
•  previ'nt  him  from  recoverinj;  wliat  ho  paid,  or 
for  wliat  he  did,  by  allowini;  for  the  amount 
and  value  of  what  he  received. 

What.  then,  did  the  plaintiff  receive  from  the 
defendant  under  this  contract".'  Certainly  not 
the  bounty  money  paid  to  the  plaintiff  wlien 
he  enlisted,  for  that  never  belonjied  to  the  de- 
fendant. He  never  had  it,  nor  any  ri.uht  to 
it;  and  of  com'se  cannot  ask  tliat  it  should  be 
restored  to  him.  The  consideration  of  the  con- 
tract moviiiic  from  the  ,l(»fendant  was  the  in- 
formation he  jjav(!  resi^H-ting  the  bounties  paid 
in  New  York,  his  payment  of  the  plaintiff's  fare 
to  New  York,  ana  his  uudertakins'  to  pay  his 
fare  back  if  he  was  not  accepted  as  a  recruit. 
The  defendant  jiaid  the  plaintitT's  fare  to  New 
Y'ork.  agreed  to  pay  his  fare  back  if  he  was 
not  accepted,  and  took  the  risk  of  losing  botli^ 
if  he  was  not  accepted.  He  also  pive  liim 
the  information  which  led  to  his  enlistment 
and  the  receipt  of  the  bomity  money.  The 
money  paid  for  fare  to  New  Y'ork  the  plaintiff 
could  repay;  but  the  other  parts  of  the  con- 
sideration of  the  contract  cannot  be  restore<l. 
All  the  ijlaintiff  can  do  in  reference  to  them  is 
to  allow  for  them  what  the  defendant  ouj;lit  in 
equity  and  justice  to  Imve. 

As  to  the  money  paid  by  the  defendant  for 
rlie  ])laintitf"s  fare,  the  defendant,  having'  re- 
ceiveil  the  .$20(1  stipulated  liy  the  contract,  is 
in  no  view  of  the  case  entitled  to  have  that 
money  paid  to  him  asiiin-  If  it  were  paid  to 
him.  and  he  took  it,  it  nnist  l)e  recoveretl  back 
ajjain  in  this  suit.  The  law  will  not  reijuire 
him  to  pay  over  money  in  order  to  maintain 
an  acti.on.  when  the  money  paid  must  be  re- 
covered back  in  the  same  action.  In  the  earl.y 
case  of  Baker  v.  Lovett,  (t  Mass.  7S,  the  infant 
plaintiff  liad  settled  a  chiim  for  an  assault  and 
battery,  and  received  a  sum  of  money  in  full 
satisfaction.  The  court  held  that  he  was  not 
bound  by  the  .settlement,  but  that  the  stmi  he 
had  leceived  should  be  deducted  by  the  .lury, 


on  trial,  from  tlic  ;ii.i(Hiiil  of  liis  daniaj^cs  as 
found  by  them;  and  the  plaintiff  was  not  re- 
<iuired  to  so  through  the  idle  ceremony  of  pay- 
ing back  the  money  lie  liad  already  received  in 
order  that  he  miglit  recover  it  again  in  that 
suit.  In  tliat  cast»  the  ])laintiff  had  received 
a  sum  of  iiKjiiey  under  tin;  contract  Ij.v  which 
he  had  discharged  his  claim  to  larger  damages 
for  the  assault  and  battery.  He  repudiated 
tlie  contract  on  the  ground  of  infancy,  and  was 
allowed  to  maintain  his  action  without  repay- 
ing the  money  he  iiad  received  on  the  contract 
liy  allowing  it  on  trial  towards  his  damages. 
The  cas(>  of  Breed  v.  .ludd.  1  Gray.  4.")7,  in- 
volves the  saihc  doctrine,  and  is  in  the  ma- 
terial facts  sul)stiintially  like  the  present. 
There  tlie  defendants  had  advanced  money  for 
tlie  plaintiff's  outlit  to  ( "alifni  nia,  and  in  con- 
sideration of  this  tlie  plaintiff  promised  them 
one-third  iiart  of  liis  earnings  while  there, 
wliicli  he  paid  to  tlu'  defendants  accordingly  b(»- 
fore  he  was  of  age;  and  the  acti(  n  was  broaght 
to  re<'over  back  the  money.  The  money  re- 
ceived liy  the  i)laintiff  for  his  outfit  was  not 
repaid  befcn'e  the  suit  was  brought,  nor  was 
this  held  to  be  necessary;  but  the  coml  left 
it  to  the  juiy  to  find  whether,  under  all  the 
circumstances,  and  looking  to  the  risks  incur- 
red by  the  defendants,  the  contract  was  rea- 
sonable; if  so.  ili;it  iKitliiug  could  l^e  recovered 
back. 

We  think  the  two  ea«es  of  Baker  v.  Lovett 
and  Breed  v.  .ludd  are  authorities  in  point,  and 
furnish  the  rule  which  must  govern  this  ca.se. 
It  is  not  necessary  that  the  money  paid  for 
the  plaintiff's  fare  should  lie  repaid  before  this 
suit  can  be  maintained  but  it  must  be  allowed 
towards  tlie  claim  of  the  iilaintiff;  and  as  to 
the  whole  question  of  what  shall  be  allowed  to 
the  defendant  it  must  lie  left  to  a  Jury  to 
say  what  is  a  reasonable  sum  for  the  defend- 
ant to  have  on  account  of  what  he  did  and  of 
the  ri.sks  he  took  in  this  contract  with  the 
plaintiff",  and  alloAV  the  defendant  such  reason- 
able sum  as  under  all  the  circumstances  they 
think  he  ought  in  justice  to  have. 

The  case  must  be  discharged,  and  the  action 
stand  for  trial,  as  facts  are  not  stated  which 
will  authorize  the  court  to  render  a  judgment. 


INl'ANTS. 


45 


ADAMS  V.  BEALL. 

(8  Atl.  GOl.  (>7  -Md.  .",;;.) 

Court   of  Appeals   of   Maryland.      March   l(j, 
1887. 

Appeal  from  the  Baltiiiiore  t-ity  court. 

Albert  Ritchie,  for  appellant.  \Villiaiu  Col- 
ton,  for  appellee. 

KOHIXSUX,  J.  The  appellee,  wliile  a  mi- 
nor, paid  to  the  appellant  Jf^.'.iCKJ,  as  a  con- 
sideration for  l)eiug  admitted  as  a  partner 
in  the  appellant's  business.  The  partuei-- 
ship  coutinned  for  more  than  a  year,  and 
lindius  it  unprotitable,  the  appellee,  withont 
formally  dissolving  the  partnersliip.  witli- 
drew  from  the  business.  The  question  in 
the  ca.se  is  whether  the  appellee  is  entitled  to 
recover  of  the  appellant  the  money  tliiis 
]iaid.  His  right  to  disaffirm  the  partnership 
contract,  and  to  avoid  all  liabilities  tinder  it, 
including  the  partnership  debts,  is  not  de- 
nied. Being  an  infant  when  the  contract 
was  made,  this  is  a  privilege  to  which  for  his 
protection  he  is  entitled.  But  when  lie  seeks 
to  recover  money  paid  for  a  consideration 
which  he  has  enjoyed  or  has  had  the  benefit 
of,  this  presents  quite  another  question. 
The  !52.tMi(t  was  paid  to  tlie  appellant  in  con- 
sideration of  being  admitted  as  a  partner  in 
his  business.  He  was  admitted  as  a  part- 
ner, and  continued  to  be  a  member  of  the 
iivm  for  at  least  a  year.  The  business  was 
not,  it  is  true,  a  successful  one,  but  this,  la 
The  absence  of  fraudulent  representations  on 
^lie  part  of  the  appellant,  cannot  affect  the 
-luestion.  We  are  dealing  with  a  contract 
between  an  infant  and  adult,  executed  on 
both  sides,  and  upon  the  faith  of  which 
money  was  paid  by  tlie  infant  for  a  consid- 
eration which  he  has  enjoyed.  Tlie  privilege 
of  infancy,  says  Lord  Mansfield  in  Zuucli  v. 
I'arsous,  o  Burrows,  18<)4,  was  intended  as  ;i 
shield  or  protection  to  the  infant,  and  not 
to  be  used  as  the  instrument  of  fraud  and 
injustice  to  others;  and  to  hold  that  an  iii- 
laut  has  the  right,  not  only  to  withdraw 
from  a  partnership  at  his  own  pleasure,  and 
to  suljject  the  adult  partner  to  the  payment 
of  all  the  partnership  debts,  but  has  the 
right  also  to  recover  money  iiaid  by  him  as 
a  consideration  for  being  admitted  into  the 
partnership,  would  be.  it  seems  to  us.  to  ex- 
tend the  privilege  beyond  any  just  principles 
uiion  which  it  is  founded. 

So  long  ago  as  Brawner  v.  Franklin.  4  Gill, 
4(Ki.  it  was  held  that,  where  an  infant  ad- 
vances money  upon  a  contract,  he  cannot 
(iisattirm  the  contract  and  recover  tlie  money 
advanced,  if  he  has  enjoyed  the  considera- 
tion for  wliich  the  money  was  paid.  Holmes 
V.  Blogg.  8  Taunt.  .308.  is  to  the  same  effect. 
There  the  infant  paid  a  sum  of  money  as  his 
share  of  the  consideration  for  a  lease  of 
premises  in  which  he  and  his  partner  carried 
on  the  business  of  shoe-making.     Tliey  occu- 


pied tlie  premises  from  March  till  .Tune, 
when  the  infant  dissolved  the  partnership, 
and  brought  an  action  to  recover  back  the 
money  he  had  paid  tin'  lessor  for  his  lease, 
(jibbs,  C.  J.,  said:  "He  may.  it  is  true,  avoid 
the  lease;  he  may  escape  the  burden  of  the 
rent,  and  avoid  tlie  covenant;  but  that  is  all 
*■  he  can  do.  He  cannot,  by  putting  an  end 
to  the  lease,  re<-over  back  any  consideration 
which  he  has  paid  for  it.  The  law  does  not 
enable  him  to  do  that." 

It  is  a  mistake  to  supi)o.se  that  the  prin- 
ciple on  which  this  case  was  decided  was  ei- 
ther overruled,  or  even  questioned,  in  Corpe 
V.  Overton,  lu  Bing.  L'.lL'.  In  the  latter  case, 
the  plaintiff,  while  an  infant,  signed  an 
agreement  to  enter  into  partnership  with  the 
defendant,  and  to  pay  him  £1,(mk»  for  a  sliare 
in  the  business;  and  to  execute,  on  the  first 
day  of  .January,  a  partnership  deed,  with  the 
usual  covenant.  He  also  paid  £10U  as  a  de- 
posit for  the  fulfillment  of  his  part  of  the 
contract.  The  plaintiff  afterwards  disattirm- 
ed  the  partnership  contract,  and  never  did 
in  fact  become  a  partner.  The  suit  was 
brought  to  recover  of  tlie  defendant  the  £1(X) 
paid  by  the  infant  as  a  deposit.  Tindal.  C. 
J.,  said:  "The  case  was  distinguishable  from 
Holmes  v.  Blogg.  In  that  case  the  plaintiff 
and  partner  occupied  the  premises  from 
:March  till  .Tune,  and  the  money  was  paid 
for  something  available,  that  is.  for  three 
months  enjoyment  of  the  premises.  In  the 
present  case,  the  plaintiff  paid  to  Overton 
flCK),  for  which  he  has  not  received  the 
slightest  consideration.  The  money  was 
paid  either  with  a  view  to  a  present  or  a 
future  partnership.  I  understand  it  as  hav- 
ing been  paid  with  a  view  to  a  future  part- 
nership. Now,  the  partnership  was  not  to 
be  entered  into  till  .January.  18oo.  and  in  the 
meanwhile  the  infant  has  derived  no  advan- 
tage whatever  from  the  contract."  Bjsan- 
quet,  J.:  "We  are  far  from  impeaching 
Holmes  v.  Blogg.  as  applicable  to  the  facts 
of  that  case.  Here  the  infant  has  derived  no 
benefit  whatever  from  the  contract,  the  con- 
sideration of  which  has  wholl.v  failed.  The 
£l<Mi  paid  here  was  in  the  nature  of  a  de- 
posit. Money  paid  on  a  deposit  may  gen- 
erally be  recovered  back  wliere  the  contract 
goes  off.  and  here  the  contract  was  defeated 
before  the  infant  derived  any  benefit  from 
it."  Alderson  and  Gaselee.  .T.T..  were  of  the 
same  opinion.  The  plaintiff  was  allowed  to 
recover  the  deposit  money  paid  by  him  while 
an  infant,  because  the  partnership  contract 
was  disaftiniied  by  Corpe  liefore  the  time 
agreed  upon  for  it  to  begin.  As  was  said  by 
Alderson.  J.,  "before  the  contract  is  per- 
formed, one  of  the  parties  revokes  it,  and 
remits  the  other  to  the  same  situation  as  if 
the  contract  had  never  been  made."  The 
distinction  between  Holmes  v.  Blogg.  and 
Corpe  V.  Overton,  is  this:  In  the  former  the 
plaintiff  was  not  allowed  to  recover  the  mon- 
ey paid  by  him  while  an  infant,  because  it 
was  paid  on  a  consideration  which  he  had  in 


4G 


INFANTS. 


imrt  ciijoycd,  while  in  tlu'  latter  the  plaintiif 
\v;i.s  allowed  to  recover  as  upon  an  entire 
failure  of  consideration. 

rassinj;,  then,  from  these  cases,  we  come 
to  Ex  parte  Taylor,  8  De  (5 ex,  M.  &  Q.  2.")4, 
wliieh  is  a  case  directly  in  point.  There  an 
infant  paid  a  premium  on  enterinf?  into  a 
l»artnersliip,  and,  before  he  came  of  •,\gi\  dis- 
atHrnu'd  the  contract,  and,  upon  thebankrupt- 
cy  of  the  tirui,  attenii)ted  to  prove  for  the  pre- 
mium thus  paid.  Lord  .Iustic(>  Knijiht  Bruce 
said:  "In  my  opinion,  a  case  of  fraud  has  not 
beeni'stablished.  That  beinj?  so.  the  matter  re- 
mainsone  of  acoutract  fairly  made, or  as  fair- 
ly made  as  a  contract  with  an  infant  could  be 
made,  a  contract  upon  which  the  infant  act- 
ed durinj;  his  minority,  and  which  durinj,' 
his  minority  has  been  in  part  performed  on 
«'ach  side.  In  such  a  state  of  things,  I  con- 
ceive that,  if  the  bankrupts  had  continued 
solvent,  and  an  action  had  been  brought 
against  them  by  the  minor,  either  before  or 
after  majority,  for  the  purpose  of  recovering 
the  money  in  question,  there  must  have  been 
either  a  nonsuit  or  a  verdict  against  him." 
Lord  Justice  Turner  said:  "It  is  clear,  an  in- 
fant cannot  be  absolutely  bound  by  a  con- 
tract entered  into  during  his  minority.  He 
must  have  the  right  upon  his  attaining  his 
majority  to  elect  whether  h«  will  adopt  the 
contract  or  not.  It  is,  however,  a  different 
question,  whether,  if  an  infant  pays  money 
on  the  footing  of  a  contract,  he  can  after- 
wards recover  it  back.  If  an  infant  buys 
an  article  which  is  not  a  necessary,  he  can- 
not be  compelled  to  pay  for  it;    but,   if  he 


does  pay  for  it  during  his  minority,  he  can- 
not on  attaining  his  majority  recover  the 
money  back." 

We  have  quoted  at  length  from  the  pre- 
ceding cases,  because  the  question  at  issue 
is  an  important  one,  and  comes  before  us  for 
the  tirst  time  for  decision.  And  while  fully 
'  recognizing  the  privilege  which  th((  law  ac- 
cords to  minors  in  regard  to  contracts  made 
during  their  minority,  yet,  in  a  case  like 
the  present,  where  money  is  paid  by  a  minor 
in  consideration  of  being  admitted  as  a  part- 
ner in  the  business  of  the  appellant,  and  he 
does  become  .and  renuiin  a  partner  for  a  giv- 
en time,  he  ought  not  to  be  allowed  to  recov- 
er back  the  money  tluis  paid  unless  he  was 
induced  to  enter  into  the  partnership  by  the 
fraudulent  representations  of  the  appellant. 
Whether  an  infant  can  avoid  a  contract  and 
sue  thereon  during  his  minority,  or  must 
wait  until  he  arrives  at  age.  is  a  question 
about  which  the  decisions  are  conflicting. 
To  hold  that  he  cannot  disaffirm  a  voidal)le 
contract  until  he  attains  his  majority  would 
in  many  cases  work  the  greatest  injustice  to 
an  infant.  And  where  the  contract  is  of  a 
personal  nature,  or  relating  to  i)ersonal  prop- 
erty, we  see  no  good  reason  why  such  a  con- 
tract may  not  be  avoided,  either  before  or 
after  his  majority.  Stafford  v.  Koof,  9  Coav. 
(ilid;  Sliipman  v.  Horton.  17  Conn.  481;  Wil- 
lis V.  Twambly,  13  Mass.  204. 

The    court    having   erred    in    gi'anting    tln- 
plaintiff's  first  and  second  prayers,  the  judg- 
ment must  be  reversed.    Judgment  reversed,, 
and  new  trial  awarded. 


INFANTS. 


47 


MOLEY  ft  al.  v.  BRINE. 

(120  Mass.  324.) 

Suprome  Judicial   Court  of   Miissacliusotts. 
Huftollv.      May    (i,    187(1. 

Bill  ill  equity  to  closo  up  a  partiicrship. 
.\t  a  former  lieariiij,',  before  Wells.  J.,  the 
jplaiutills  relied  on  an  agreement  si;riie(l  by 
the  three  partners,  of  which  the  followinji  is 
a  copy:  "Ajireenient  made  this  third  day  of 
August,  A.  D.  ISTl.  between  J.  li.  Brine,  P. 
.T.  Moley,  and  E.  V.  .Tackson.  The  partner- 
ship heretofore  existing  nnder  the  lirm  of 
Brine  Bros.  &•  Co.  is  hereby  dissolved.  E. 
I".  .lackson  is  alone  authorized  to  sign  the 
name  of  the  firm  in  li(piidation,  make  collec- 
tions, pay  bills,  receive  money,  and  draw 
checks,  until  the  old  bnsiness  is  settled  as 
hereafter  arranged.  The  other  partners  shall 
assist  in  closing  np  the  business,  except  as 
.iforesaid.  From  coUectious  and  assets,  E. 
I'".  .Tackson  is  to  receive  the  sum  advanced 
b.v  him,  $4,874,  without  interest.  The  bal- 
ance of  assets  and  property,  after  paying 
debts,  to  be  divided  between  Messrs.  Brine 
and  Moley.  according  to  their  interest  in  the 
l)usiness;  that  is  to  say,  .$1.8()(),  without  in- 
terest, to  Moley,  and  the  balance  to  Brine. 
Brine  takes  the  store  and  business.  Brine 
and  Moley  assume  the  risk  of  all  accounts 
and  contracts  iip  to  August  1,  1871.  All  mon- 
ey drawn  from  the  business  after  August  1, 
1871,  by  P.  J.  Moley  and  E.  F.  .Tackson  is  to 
be  deducted  from  the  above  portion."  Un- 
der that  agreement  .Tackson  had  begun  to 
licpiidate  the  affairs  of  the  firm  prior  to  the 
filing  of  this  bill. 

It  Avas  then  ordered:  (1)  That  that  agree- 
ment "be  set  aside  and  annulled  as  an  agree- 
ment, the  said  Brine  being  a  minor  at  that 
date,  and  having  elected  to  avoid  the  same  on 
that  ground;  and  that  said  writing  be  taken 
to  have  no  further  or  other  effect  than  as  evi- 
dence upon  the  question  of  the  actiial  trans- 
actions and  relations  between  the  parties." 
(2)  "That  the  case  be  referred  to  a  master  to 
hear  the  parties,  and  report  to  the  court  his 
tuidings  as  to  the  actual  relations  between 
the  i)arties  and  their  respective  rights  in  and 
to  the  funds  and  assets  that  are  now  in  or 
that  may  come  into  the  hands  of  the  re- 
ceiver; and  also  to  state  the  accounts  be- 
tween them." 

The  master's  i-eport  stated  the  following 
facts:  The  partnership  was  formed  about 
July  1st,  and  was  dissolved  by  mutual  con- 
sent on  August  4,  1871.  At  the  formation  of 
the  partnership.  Jackson  contributed  to  the 
common  stock  !f4.!^'''4.  Moley  $1.8(Ht.  and  Brine 
$8,82.  and  it  was  agreed  that  each  should 
receive  one-third  of  the  profits.    During  the 


conlinuance  of  the  partnership  Jackson  drew 
out  .$:i4,  Moley  -i^lW,  and  Brine  .^(m:'..!."). 
There  were  no  profits  of  the  partnership,  and 
the  assets  were  not  sufticieiit  to  pay  back  in 
full    the    original    contributions. 

At  the  final  hearing  before  Colt,  J.,  the 
jdaintiffs  contended  that,  no  agreement  be- 
ing shown  as  to  th<'  division  of  the  commnn 
stock  ui)on  a  dissolution  of  the  Dartnershii). 
each  partner  was  entith-d  to  the  amomil  of 
his  contribution  and  interest,  and  that  the 
deficiency  in  assets  sliould  be  borne  tiy  tlie 
partners   ecpially. 

The  defendant  contended:  (1)  That  the  as- 
sets should  be  etjually  <livided  among  the 
three  partners,  without  regard  to  the 
amounts  contributed  by  each.  (2)  That,  if 
such  was  not  the  rtile,  then  the  deticiency 
should  be  borne  by  the  several  partners  in 
proportion  to  the  several  amounts  contribut- 
ed by  them,  and  that  the  defendant  snould 
not  bear  any  part  of  the  deficiency. 

The  case  was  reported  for  the  considera- 
tion of  the  full  court,  such  order  or  decree  to 
be  entered  as  the  case  required. 

S.  J.  Thomas,  for  plaintiffs.  M.  A.  P.lals- 
dell,  for  defendant. 

GRAY.  C.  J.  The  assets  remaining  upon 
the  settlement  of  the  Imsiness  of  the  part- 
nership, being  less  than  the  amount  con- 
tributed by  all  the  partrers  to  the  common 
stock,  must  be  divided  among  tiiem  accord- 
ing to  the  amount  of  their  contributions,  and 
the  deficiency  must  be  borne  by  the  partners 
in  the  same  proportions  in  which  they  were 
to  bear  profits  and  lo.sses;  that  is  to  say,  in 
this  case,  equally.  Wlntcomb  v.  Converse. 
119  Mass.  38. 

This  rtde  is  not  affected  by  the  fact  that 
the  defendant  is  an  infant.  According  to 
the  agreement  between  the  parties,  he  con- 
tributed less  than  one-eighth  of  the  capital 
stock,  and  was  to  receive  one-third  of  the 
profits  of  the  business.  He  actually  entered 
into  the  partnership,  had  the  benefit  of  it 
while  it  lasted,  and  drew  out  the  greater  part 
of  his  contribution.  The  assets  remaining 
at  the  time  of  the  dissolution  being  insutfi- 
cient  to  pay  the  claims  of  all  the  iiartners, 
the  loss  of  capital  must  fall  upon  the  three 
partners  in  ecpial  proportions,  and  the  infant 
cannot  throw  upon  his  co-partners  the  obliga 
tion  of  making  up  the  deticiency.  Breeil  v. 
Judd.  1  Gray,  4.V>:  Holmes  v.  Blogg.  2  Moore, 
.j.")2,  8  Taunt.  r»08:  Ex  parte  Taylor.  8  I)e 
Gex.  M.  <.V:  G.  2.")t;  Aldrich  v.  Abrahams, 
Hill  &  D.  423,  42."»;  Medbury  v.  Watrous,  7 
Hill,  110,  112,  113;  Heath  v.  Stevens,  48  N. 
H.  251. 

Decree  for  the  plaintiffs  accordingly. 


is 


INFAXTS 


DLBE  V.  HKAIDUY. 

{2:\  N.  K.  I'L'l',  ir.(»  M:iss.  44S.> 

Supreiue  .liuliiial   Court  nf   Massacbusotts. 
Essex.      Jan.  2.  18!)0. 

Report  from  superior  court.  Essex  coun- 
ty ;  .Tou.x  L.VTHKoi'.  .luduo. 

Action  l).v  Joseph  Ih^ln'.  ficr  j>r<><-lifin  mni, 
to  recoverfroin  'i'lu'oj)hile  lU'amlry  for  serv- 
ices rendered.  Tlie  case  was  heard  by  the 
court  witiiout  a  jury.  Tlie  court  found 
ft)r  the  (left>ndant,  and  repi>rfed  tlie  cause 
to  tlie  full  bench. 

C.St^wnll,  for  plainliff.  ,/.  .1/.  ILiyinoml, 
for  defendant. 

FIELD.  J.  The  plaintiff,  a  minor,  witli 
the  assent  of  liis  mother,  aiireed  with  the 
<lefendant  to  work  for  him  for  eijiht  dol- 
lai-s  a  wt'ck,  one-half  to  be  paid  to  the 
plaintiff,  and  tlieother  half  tobeapi)lied  by 
the  defi'iidant  to  the  payment  of  a  debt  due 
to  the  dcfi'iidant  from  the  estate  of  the  de- 
cea.sed  father  (.)f  the  plaintiff.  The  court, 
tryinji'  the  case  without  a  jury,  found  that 
the  jilaintiff's  services  were  not  worth 
eijiht  dollars  a  wet^k  for  the  first  part  of 
the  time  he  worked.  Init  "werewortli  eight 
<U)llai's  a  week  for  the  whole  time."  The 
plaintiffs  ])ay  was  raised  from  time  to 
time,  and,  after  he  had  Avorked  for  the  de- 
fendant ei.ulit  weeks,  *'his  pay  was  raised 
to  t  welvcdollars"  a  week.  The  defendant 
]>aid  him  four  dollars  a  week  for  the  whole 
time  he  worked,  and  applied  the  remainder 
<jf  his  waues  to  the  iiaynient  of  the  <lebt 
asjaiust  the  fathers  estate.  At  the  end  of 
2(5  weeks,  when  the  delit  had  been  paid,  the 
defendant  discharii;ed  the  plaintiff  from  his 
employment.  The  court  also  found  that 
"the  a.iireement  was  not  so  unreasonably' 
as  to  raise  any  suspicion  of  framl :""  "that 
the  plaintiff  had  not  been  overreached : "" 
and  ruled,  "as  matter  of  law.  that  the 
plaintiff  was  not  entitled  to  avoid  thecon- 
tract.  it  having  been  fully  executed."  It 
is  clear  that  the  court  found  that  the 
AAliole  amount  of  the  wages  agreed  upon, 
from  tiineto  time,  was  as  much  asor  more 
than  the  jilaintiff's  services  were  Avorth, 
but  that  the  amount  of  money  i)aid  to  the 
plaintiff  was  less  than  his  services  were 
worth.  It  is  clear,  also,  that  the  plaintiff 
was  not  bound  to  pay  his  father's  debts; 
that  the  contract  made  in  this  case  was 
not  for  mressaries.  and  was  not  ntx^essari- 
ly  beneficial  to  the  plaintiff:  and  that  by 
our  decisions,  in  order  to  avoid  such  a  con- 
tract, it  is  generally  not  necessary  that  the 
minor  put  the  other  party  in  statu  r/f/o.or 
return  theconsideration  received,  (."handler 
V.  Simmons,  !>7  Mass.  ."^Ds.  .">14 ;  Bartlett  v. 
Drake,  loo  Ma.ss.  174;  Walsh  v.  Young,  llo 
Mass.  :5iH):  (iaffnev  v.  Hayden.  Id.  137 ; 
r>radford  v.  French.  Id.  :'.r..") ;  ilaker  v.  .stone. 
18tj  Mass.  40."i:  McCarthy  v.  Henderson,  los 
Mass.  olO.  Gaffney  v.  llayden.  ubi  supra, 
shows  that,  if  the  amount   of  the  wages 


aii-ecl  upon  had  not  been  as  much  as  the 
l)laiiitiffs  sei  V  ces  were  worth,  the  fact 
that  the  plaintiff  had  received  his  pay  while 
a  minor  would  not  luev  cut  him  from  avoid- 
ing the  contract,  and  suing  on  a  ()nnntntn 
meruit.  In  the  opinion,  the  cases  of  Stone 
V.  Dennison,  l;')  Pick.  1.  and  Breed  v.  Judd, 
1  (Jray.  45.').  which  the  jircsiMit  defendant 
cites,  are  considered  and  distinguished. 

It  is  sugg(>sted  that  the  plaintiff's  agree- 
ment that  tlu>  defenilant  should  ajtply  a 
part  of  the  wag'-s  to  the  extinguishment 
of  the  father's  indebtedness  makes  the  act- 
ual ai>plication  of  the  wages  by  the  de- 
fendant eipiivalent  to  a  payment,  in  pursu- 
ance of  this  a.greement.  and  Ijefore  it  was 
revoked,  of  money  by  the  ])l,'untiff  to  the 
defendant  for  the  purpose  of  extinuuishing 
this  debt.  It  is  argued  that  if  a  miiioi- vol- 
untarily jiays  money  under  a  contract  he 
cannot  receiver  the  money  he  has  paid, 
when  he  has  received  any  i)eneHt  from  the 
contract,  or  any  part  of  the  consideration, 
except  by  rescinding  the  contract;  and 
that  a  contract  cannot  be  rescinded  unless 
the  other  party  is  put  in  st.itu  iinn;  and 
tliat.in  the  present  case,  it  doesnot  appear 
that  the  defendant  can  be  i)ut  in  st;itij  nun, 
because  he  may  have  lost  his  remedy 
against  the  estateof  thefather.  SeeShurt- 
leff  V.  Millard,  12  R.  I.  272;  Robinson  v. 
Weeks,  .")(>  Me.  1(12;  Sparman  v.  Keim.  So  N. 
Y.  24.">:  Adams  v.  Heal.  (i7  Md.  oi,  !S  Atl. 
Rep.  (U)l;  Ex  i)arte  Taylor.  S  De  (lex.  M.  & 
(t.  2.'>4.  It  does  not  ai)pear  that  the  plain- 
tiff did  or  could  receive  any  benefit,  direct- 
ly or  indirectly,  from  paying  his  father's 
debts.  It  appears  that  the  father  died 
seised  of  real  estate  "  which  he  devised  to 
his  widow,"  and  which  the  widow  con- 
veyed to  his  eldest  son,  the  brother  of  the 
plaintiff;  but  it  doesnot  apjiear  that  ti?" 
plaintiff  wasentitled  to  receive  any  proper- 
ty from  tile  estate  of  his  father,  and  there- 
fore it  do(>s  not  ai)pear  that  the  ])laintiff 
had  any  interest  in  preventing  the  defend- 
ant from  collecting-  the  debt  out  of  the  es- 
tate of  the  father.  The  action  is  iK»t  tore- 
cover  money  paid.  The  contract,  so  far  as 
it  related  to  the  jiayment  of  the  father's 
debt,  would,  in  ancient  times,  have  been 
held  absolutely  void,  if  made  by  an  infant. 
We  think  that  the  principle  contended  for. 
whether  it  is  consistent  or  not  with  our 
decisions,  is  nt)t  applicable  to  this  case.  It 
is  necessary  for  the  protection  of  an  infant 
that  he  should  not  lie  bound  by  a  contract  to 
pay  out  of  his  earnings  the  debt  of  another 
I>erson.  and  the  defendant  had  no  right  to 
rely  njion  such  a  contract,  and  forego  any 
remedies  he  might  have  had  against  the 
estateof  the  father.  The  defendant  can- 
not be  said  to  have  acted  as  agent  of  the 
plaintiff  in  paying  the  wages  to  himself, 
within  the  principle  declared  in  Welch  v. 
Welch,  111:'.  Mass.  r)(;2.  because  he  still  re- 
tains the  benefit.  It  isnoi  contended  that 
the  mother  was  entitled  to  the  wages  of 
the  plaintiff.  By  the  terms  of  the  report 
thei-e  must  be  a  new  trial.     So  ordered. 


IXFAN'J!- 


49 


TKAIXKU   V.  'riMMP.II.L. 

((i  \    !•:.  Tin.  141  .Mass.  .VJ7,i 

Sni)i'('iii('  .Iiiilicial   Court   of   Miissacliiisolts. 
Suffolk.      May  7.  ISSf,. 

This  was  an  action  of  contract  for  articles 
furnished  to  tlic  defendant,  a  niiiu)r,  by  the 
philntiff.  Ilearini?  in  tlie  superior  court,  be- 
fore Brifihani,  C  J.,  witliout  a  .iury,  who  found 
tlie  folio wini?  facts:  Defendant  was  a  minor, 
wlio  was  born  in  January,  ISns.  and  was  tlie 
only  child  of  George  B.  Trunibnll,  who  died 
at  the  soldiers'  home  in  Toj^Jis,  ^Nlaine,  No- 
vcMuber  1,  1S83.  where  he  had  ivsided  from 
187()  and  previously.  Defendant's  mother, 
Avho  was  the  wife  of  said  Georj^e  H.  Trunibnll, 
was,  on  October  "25,  187o,  committed  to  the 
house  oi  industry  on  Deer  Island.  Boston,  and 
defendant  was,  on  the  same  day,  sent  to  the 
almsliouse  on  said  Deer  Island  as  a  pauper, 
and  there  remained  until  he  was  removed  to 
the  Marcella-street  home  for  paupers  and  neg- 
lected boys  and  girls,  in  April.  1877.  On  No- 
vember 17,  1877,  the  plaintiff  removed  defend- 
ant from  said  Marcella-street  home  to  her 
home,  he  then  being  a  pauper,  and  in  a  dis- 
eased and  sickly  condition,  and  there  kept  him 
to  the  time  of  bringing  this  action,  and  dur- 
ing all  this  period  maintained  defendant,  pro- 
viding him  with  food,  chjthing,  lodging,  medical 
attendance,  and  nursing  when  sick,  and  the 
means  of  education,  at  a  cost  to  plaintiff, 
Avhich,  in  addition  to  the  reasonable  value  of 
her  services  in  making  such  provision,— which 
the  coiart  ruled,  as  a  matter  of  law,  was  a 
provision  for  necessaries  to  defendant, — was 
not  less  than  the  sum  stated  in  the  account 
annexed  to  the  declaration.  I'laintiff.  on  a 
visit  to  Togus,  and  to  the  soldiers'  home,  in 
187(5.  became  acquainted  with  said  George  B. 
Trumbull,  who  exhibited  much  distress  on 
account  of  defendant  being  an  inmate  of  an 
asylum  for  paupers,  and  his  reported  sickly 
condition;  stating  to  her  that  he,  George  B. 
Trumbull,  had  certain  property  bequeathed  to 
him  by  one  Susan  Bryant,  whose  adopted  son 
he  was,  which  gave  him  oily  a  small  income, 
but  that  at  his  death  the  defendant  would  be 
worth  .1;1U,(XMJ,  riaintiff.  at  said  George  B. 
Trumlndl's  request  having  informed  herself 
of  the  provisions  of  the  will  of  Susan  Bryant, 
and  of  the  terms  of  a  lease  to  one  Cutler,  made 
by  George  B.  Trumbull,  of  the  property  re- 
ceived from  said  Susan  Bryant,  and  of  the 
value  and  income  of  the  estate  to  which  it 
related,  undertook  and  continued  the  mainte- 
nance of  defendant  as  aforesaid,  not  in  any 
respect  relying  upon  the  credit  of  said  George 
B.  Trumbull,  but  relying  solely  upon  the  cred- 
it of  defendant's  estate  One  Teele,  since  No- 
vember, 188.'},  as  guardian  of  the  defendant, 
has  had  possession  and  control  of  real  es- 
tate in  Boston  of  the  value  of  about  $8,(X)U, 
which  constitutes  all  of  defendant's  property. 
At  the  close  of  plaintiff's  case  defendant  of- 
fered no  evidence,  but  reqn?sted  the  court  to 
rule,  as  matter  ot  law  that  upon  all  the  facts 
in  evidence  on  the  part  of  the  plaiutifl:  this 
VAN  zilp:  sel.cas. sales — 4 


action  c(jui<I  not  be  maiiitaiiird.  The  court 
refused  to  rule  as  re(|iiesled.  and  ruled  that 
ui)on  the  facts  found  the  plaintitT  was  en- 
titled to  the  sum  stated  in  her  account,  found 
f(jr  the  plaintifT.  assessed  damages  in  the  sum 
of  .'i;i,11ii.."i;',.  and  onh'i-ed  judgment  for  plain- 
tiff for  that  sum;  and  the  defendant  alleged 
exceptions. 

J.  It.  Smitli.  f(M-  plaintilT.  Brown  iV  K<'yes. 
for  defendant. 

ALLION,  J.  The  practical  question  in  this 
case  is  whether  the  food,  clothing,  etc.,  fur- 
nished to  the  defendant  were  necessaries  f(jr 
which  he  slunild  be  held  responsible.  This 
question  must  be  deterniiue<l  by  the  actual 
state  of  the  case,  and  net  by  apjiearances;  that 
is  to  say,  an  infant  who  is  already  well  pro- 
vided for  in  respect  to  board,  dotliing.  and 
other  articles  suitable  for  his  condition,  is  not 
to  be  held  responsible  if  anj  one  supplies  to  him 
other  l)oard,  clothing,  etc.,  although  such  per- 
son did  not  know  that  the  infant  was  already 
well  supplied.  Angel  v.  McLellan,  lt»  Mas.s,. 
31;  Swift  V.  Bennett,  10  Cush.  4:>(i;  Davis  v. 
Caldwell,  12  Cush.  512;  Barnes  v.  Toye,  13 
Q.  B.  Div.  410.  So,  on  the  other  hand,  the 
mere  fact  that  an  infant,  as  in  this  case,  had 
a  father,  mother,  and  guardian,  no  one  of 
whom  did  anything  towards  his  care  or  sup- 
port, does  not  prevent  his  I)eing  iKiund  to  pay 
for  tliat  which  w-as  actually  necessary  for  him 
when  furnished  The  question  whether  or  not 
the  infant  made  an  express  promise  to  pay  is 
not  important.  He  is  held  on  a  promise  im- 
plied liy  law,  and  not.  strictly  speaking,  on  his 
actual  promise.  The  law  implies  the  promise 
to  pay  from  the  necessity  of  his  situation;  just 
as  in  the  case  of  a  lunatic.  1  Chit.  Cont.  i:»7: 
Hyman  v.  Cain,  3  .Jones  (N.  C.)  ill;  Uichard- 
son  v.  Strong,  13  Ired.  lOG;  Gay  v.  Ballou,  4 
Wend.  4(>8;  Epper.son  v.  Nugent,  7)7  Miss. 
4.5^7.  In  other  words,  he  is  liable  to  pay  only 
Avhat  the  necessaries  were  reasonably  worth, 
and  not  what  he  may  improvidentlj'  have 
agreed  to  pay  for  them.  If  he  has  made  an 
express  promise  to  pay,  or  has  given  a  note 
in  payment,  for  necessaries,  the  real  value  will 
be  inquired  irto,  and  he  will  be  held  only  for 
that  amount.  Earle  v.  Reed,  10  Mete.  387; 
Locke  V.  Smith,  41  N.  II.  .'540;  Mete.  Cont. 
73,   73. 

But  it  is  contended  that  the  board,  clothing, 
etc.,  furnished  to  the  defendant  were  not  nec- 
essaries, because  he.  "being  a  pauper,  and  an 
inmate  of  an  almshouse,  was  supplied  with 
necessaries,  suitable  to  his  estate  and  condi- 
tion, and,  under  the  circumstances,  it  would 
have  been  the  duty  of  the  guardian  to  place 
him  in  the  almshou.H'."  It  is  true  that  a 
guardian  is  not  obliged  to  provide  for  the  sup- 
port of  his  ward  when  he  has  no  property  of 
the  ward  available  for  that  puipose;  and.  if 
be  has  no  other  resource,  no  doubt  he  may, 
under  such  circumstances,  place  the  ward  iu 
an  almshouse.  The  authorities  cited  for  the 
defendant  go  no  further  than  this.  Spring  v. 
Woodworth,    2   Allen,   20(3.     But    this    by    no 


50 


INFANTS. 


iiicans  implies  that  a  buy  with  cxpcctatiou  of 
a  rortunt'  of  ."flU.ooo  slumld  be  bioujilit  up  iu 
Jill  almshouse  if  any  suitable  person  will  take 
him,  aud  briuj?  him  >ip  properly,  ou  the  credit 
of  his  expectations.  Ou  the  other  hand,  it 
seems  to  us  highly  proper  for  a  parent  or 
jiuardiau.  under  such  circumstances,  to  do 
■what  the  father  did  iu  this  case;  leaving-  it 
for  the  boy's  guardian  to  see  to  it  that  an  un- 
ivasonable  price  is  not  paid.  I.ooking  to  the 
advantage  of  his  subsiMjuent  life,  as  well  as 
to  his  welfare  for  the  time  being,  his  transfer 
from  an  almshouse  to  a  suitable  person,  by 
-whom  he  would  be  cared  for  aud  educated, 
would  certainly  be  judicious;  and  the  sup- 
port and  education  furnished  to  an  infant  of 


I  such  expectations,  whose  means  were  not  pres- 

j   ently  available,  fall  clearly  within  the  class  of 

I  necessaries.     In  Mete.  Cont.  70,  the  authority 

of  Lord  Manstield  is  cited  to  the  point  that  a 

sum  advanced  for  taking  an  infant  out  of  jail 

is  for  necessaries.    Earl  of  Buckinghamshire  v. 

I  Drury,  2  Eden,  72.     See.  also,  Clarke  v.  I^eslie,, 

]  .1  Esp.  28.     < Jiving  credit  to  the  infant's  ex- 

I  pectation   ot  jirojierty   is   the  same   as  giving 

credit  to  him. 
!  There  was  no  error  in  refusing  to  rule,  as 
I  matti'r  of  law,  that  upon  all  the  facts  in  evi- 
dence the  action  could  not  be  maintained. 
The  tindiugs  of  all  matters  of  fact,  of  course, 
are  not  open  to  revision.  Exceptions  over- 
ruled. 


INFANTS. 


51 


EN(;LEBEHT  v.  TKOXELL  et  al. 
(58  N.  AV.  852.  40  Neb.  195.) 

Suprciiu-   Court   of  Nclirjiska.      April   17,   1X04. 

Appeal  from  district  court,  Douj;las  coun- 
ty;   Ilcrhort  J.  Davis,  Jiulfic 

Action  by  Francis  L.  Enjilebort  aj^ainst 
Bonjaniin  Troxell  and  others  to  rec(rver  i)os- 
session  of  land.  Judgment  for  plaintiff,  and 
defendants  bring  error.      Atlirnied. 

Geo.  E.  Pritcliett  and  Switzler  it  Mcin- 
tosh, for  apjiellants.  St.  John  &  Stevenson 
and  Chas.  Olfutt,  for  appellee. 

RAdAN,  C.  On  April  1,  1874.  Mrs.  Fran- 
cos H.  lOnglebert  was  the  owner  of  lot  3  in 
Gise's  addition  to  the  city  of  Omaha.  At 
that  time  she  and  her  luisband,  J.  Lee  Enjjle- 
bert,  executed  a  mortgage  on  said  lot  to  Max 
Meyer  »fe  Bro.,  to  secin-e  a  note  of  $.'578.48, 
due  .Ttily  1,  1874.  Soon  after  that  time,  Mrs. 
lOuglebert  and  her  hiisl)and  removed  to  Des 
Moines,  Iowa,  in  which  city  Mrs.  Engle- 
bert  died  on  the  29th  of  December,  1875. 
She  die<l  intestate,  leaving  her  husband  and 
one  child,  the  appellee  herein,  then  a  boy 
about  seven  years  of  age.  November  1.  1881, 
Max  M(\ver  «fc  Bro.  brought  suit  in  the  dis- 
trict court  of  Douglas  county  against  ;Mr. 
and  Mrs.  Englebert,  only,  to  foreclose  the 
mortgage  above  mentioned,  and  obtained 
service  upon  them  by  publication;  Max 
Meyer  &  Bro.  being  then  ignorant  of  the 
fact  of  Mrs.  Englebert's  death.  December 
17,  ISSl.  George  E.  Pritchett,  an  attorney 
at  law  residing  at  Omaha,  Neb.,  informed 
Mr.  Englebert,  by  letter,  of  the  pendency 
against  him  and  his  wife  of  Max  Meyer  &; 
Bro.'s  mortgage  foreclostire  suit,  and  re- 
quested to  be  authorized  to  appear  in  and 
defend  the  same.  Various  communications 
took  place  immediately  afterwards  between 
Pritchett  and  Mr.  Englebert;  finally  cul- 
minating in  an  agreement  between  them 
that  Pritchett  should  defend  the  foreclosure 
suit  for  Englebert  and  his  minor  son,  and 
I'eceive,  as  compensation  for  his  services,  oue- 
half  of  whatever  of  the  lot  he  might  suc- 
ceed in  saving  from  the  lien  of  the  Max 
Meyer  tfc  Bro.  mortgage.  In  piu'suance  of 
this  agreement,  on  the  4th  day  of  August, 
1885,  Mr.  Englebert  and  his  minor  son  con- 
veyed to  Pritchett,  subject  to  tht^  ^lax  ^Meyer 
&  Bro.  mortgage,  an  undivided  one-half  of 
he  aforesaid  lot.  Pritchett  seems  to  have 
succeeded  in  having  the  foreclosure  stiit,  as 
brought,  continued  from  time  to  time,  on  one 
pretext  or  another,  until  August,  1884.  In 
Aug-ust,  1885.  :SIax  Meyer  &  Bro.  filed  an 
amended  petition  in  their  foreclosure  suit, 
..i.-..ing  Francis  Leon  Englebert,  the  minor 
son  of  Mr.  and  Mrs.  P^nglebert,  a  party  de- 
fendant to  the  action.  Pritchett  filed  an  an- 
swer on  behalf  of  Mr.  Englebert  to  this 
amended  petition,  and  (having  been,  by  the 
court,  appointed  guardian  ad  litem  for  Fran- 
cis Leon  Englebert)  also  filed  an  answer  in 


the  action  for  him.  These  answers  admitted 
the  execution  and  delivery  of  the  note  and 
mortgage  described  in  the  foreclosure  suit; 
alleged  that  the  legal  title  to  the  property 
was  at  the  time  of  the  execution  of  the  mort 
gage  in  Mrs.  Englebert;  her  death,  and  that 
the  legal  title  to  the  real  estate  had  descend- 
ed to,  and  was  then  vested  in.  the;  minor  son. 
Francis  Leon  Englel)ert;  that  the  only  in- 
terest that  Mr.  Fuglelx-rt  had  in  the  i)roperty 
mortgaged  was  a  life  estate,  as  tenant  by  the 
cin-tesy  of  his  deceased  wife;  and  that  the- 
interest  of  the  minor,  Francis  Leon  Engle- 
bert, in  the  real  estate,  could  not  be  sold  to 
satisfy  the  mortgage  debt,  because  the  action, 
as  against  him,  was  not  brought  within  10 
years  from  the  date  of  the  matm-ity  of  the 
note  which  the  mortgage  was  given  to  se- 
cure. The  court  rendered  a  decree,  and  or- 
dered th(>  life  estate,  only,  of  Mr.  Englebert 
sold  to  satisfy  the  amount  found  due  on  the 
mortgage.  This  life  estate  was  sold  under  ji 
decree,  the  property  purchased  by  one  of  the 
plaintiffs  in  the  foreclosure  suit,  and  the 
sale  confirmed.  A  deed  was  ordered,  but 
never  made,  to  the  purchaser.  On  the  Gth 
day  of  January,  188<).  on  the  joint  applica- 
tion of  Mr.  Englebert  and  his  minor  son.  Mr. 
Pritchett  was  appointed  guardian  of  the 
minor  son  by  the  county  court  of  Douglas 
county,  accepted  the  trust,  and  qualified 
therefor  by  taking  the  oath,  and  giving  bond, 
as  required  by  statute.  On  .luue  1.  188(;.  in 
pursuance  of  an  agreement  between  ^Ir. 
Pritchett  and  Mr.  Englebert.  his  son  (then  be- 
ing about  IS  years  of  age),  in  con.sideration  of 
^■240  in  cash  then  paid  by  Pritchett  to  Engle- 
bert. conveyed  to  Pritchett  the  remaining  im- 
divided  one-half  of  the  lot.  On  the  22d  day  of 
December.  IS.SS.  .1.  Lee  Englebert  died.  ( »n 
the  11th  of  October,  1889,  Francis  Leon  Engle- 
bert became  of  age.  and  one  month  and  three- 
days  thereafter,  to  wit.  on  the  14th  day  of 
November.  1889,  brouglit  this  suit  in  eipiiiy 
in  the  district  covu't  of  Douglas  county,  against 
the  said  George  E.  Pritcliett  and  others  wlio 
were  claiming  to  be  owners  of  some  ])art  of 
said  lot  under  conveyances  from  Pritchett. 
to  cancel  and  set  aside  the  deeds  hereinltefort- 
mentioned,  made  by  himself  and  fath(>r  to- 
I'ritchett;  alleging  that  at  the  time  he  exe- 
cuted said  deeds  he  was  seised  in  fee  simi)Ie- 
of  the  propert.v,  and  was  a  minor.  The  dis- 
trict court  rendi>red  a  cU'crt-e  canceling  and 
setting  aside  said  deeds,  and  awarding  the 
plaintiff  a  writ  of  possession  for  said  real 
estate.     The  case  is  before  us  on  appeal. 

The  reported  decisions,  «'specially  the  older 
ones,  abound  with  grave,  learned  and  lengthy 
discussions  of  the  (inestion  as  to  whether  the 
contracts  of  an  infant  are  void  or  voidable: 
and  there  an*  respectable  atithorities  which 
hold  that  certain  contracts  of  an  infant, 
made  under  certain  circumstances,  are  abso- 
lutel.v  void;  but  we  think  that  the  better 
rule,  and  the  one  supported  by  the  weight  of 
authority,  is  that  all  contracts  of  an  infant, 
except  those  for  necessaries,  are  voidable  b\- 


INFANTS. 


Tho  infant,  at  his  ck-ctiou,  within  a  riMSona- 
l)lo  tinu'  after  he  becomes  of  aj^e.  In  Timi- 
son  V.  Clianiblin,  SS  111.  378,  the  rule  is  thus 
stated:  "Deeds  made  by  a  minor  are  not 
void,  but  only  voidable.  Their  validity  does 
not  depend  on  a  ratification  after  a  minor 
attains  his  ase;  but,  to  avoid  tluMu.  he  must, 
by  some  act,  clear  and  unmistalcable  in  its 
clnracter,  disaffirm  their  validity."  See,  also, 
lioimer  v.  Land  Co.,  75  111.  olo;  Hyer  v. 
Hyatt.  3  Cranih  C.  C.  270,  Fed.  Cas.  No. 
<;.;)'.17;  Kendall  v.  Lawrence,  22  Tick.  540; 
Dixson  V.  Merritt.  21  Minn.  ITHj;  Manufac- 
turinj:  Co.  v.  Lamb,  81  Mo.  221;  Irvine  v. 
Irvin(>.  9  Wall.  617;  Pom.  Eq.  Jur.  (2d  Ed.) 
§  1)45.  Such  is  also  the  doctrine  of  this 
court  as  stated  in  Philpot  v.  Manufacturing 
Co..  18  Neb.  54,  24  N.  AV.  428,  where  it  is 
said:  "Contracts  of  an  infant,  other  than 
for  necessaries,  are  voidable  only;  and,  iipon 
comini;-  of  a.ire,  he  may  affirm  or  avoid  them, 
in  his  discretion."  The  deeds  made  by  the 
appellee  in  this  case  to  Pritchett  were  voida- 
ble, and  not  void.  The  appellee,  within  le.=:s 
than  two  months  after  his  becoming  of  age. 
instituted  this  suit  for  the  purpose  of  cancel- 
ing the  deeds  made  to  Pritchett.  This  was, 
on  the  part  of  the  appellee,  an  unequivocal 
and  sufficient  disaffirmance,  on  his  part,  of 
the  contracts  made.  Tunison  v.  Chamblin, 
supra;    Sims  v.  Everhardt,  102  U.  S.  300. 

Was  the  disaffirmance  of  these  deeds  by 
appellee  made  within  a  reasonable  time?  As 
to  what  is  a  reasonable  time  for  an  infant, 
after  becoming  of  age.  to  disaffirm  contracts 
made  during  his  minority,  is  a  mixed  ques- 
tion of  law  a.nd  fact,  to  be  determined  from 
the  circumstances  in  each  particular  case. 
In  Ward  v.  Laverty,  19  Neb.  429.  27  N.  W. 
393,  this  court  said:  "A  minor  who  has  con- 
A  eyed  his  real  estate  miist  disaliirm  the  deed 
within  a  reasonable  time  after  becoming  of 
age.  or  be  barred  of  that  right."  In  that 
case  the  disaffirmance  was  not  made  until 
more  than  three  years  after  the  minor  be- 
came of  age,  and  the  court  held  that  the  dis- 
affirmance, luider  the  facts  in  the  case,  was 
not  made  within  a  reasonable  time.  In 
O'Brien  v.  Gaslin,  20  Neb.  347.  :iO  N.  W.  274, 
this  court,  adhering  to  the  I'ule  announced  in 
Ward  v.  Laverty,  held  that  a  disaffirmance 
made  by  a  party  14  years  after  he  became 
of  age  was  not  made  within  a  reasonable 
time.  In  Johnson  v.  Storie,  32  Neb.  610,  49 
N.  W.  371.  an  infant  Avho  had  signed  a  note 
as  surety  disaffii-med  the  same  a  year-  and  a 
half  after  he  became  of  age;  and  it  was 
held  that  the  disaffirmance  was  made  within 
a  reastmable  time.  There  are  some  eminent 
authorities  which  hold  that  an  infant  may 
disaffirm  a  deed,  which  he  has  made  to  his  real 
estate  during  his  minority,  at  any  time,  after 
he  becomes  of  age,  before  he  would  be  barred 
by  the  statute  of  limitations  from  bringing 
an  action  in  ejectment  for  the  real  estate. 
But  this  is  not  the  doctrine  of  this  coiu't.  It 
is  now  firmly  settU'd  here  that  an  infant,  in 
order  to  avoid  a   contract  made  during  his 


minority,  nuist  disaffirm  the  snme  within  a 
reasonable  time  after  his  minority  ends. 
There  can  be  no  doubt,  in  view  of  the  au- 
thorities quoted  above,  but  that  the  appellee 
disaffirmed,  within  a  reasonable  time  .-ifter 
lie  became  of  age,  the  deeds  made  to  Pritch- 
ett. 

It  is  insisted  by  the  appellants  that  the 
first  deed  made  by  appellee  to  Pritchett  was 
voidable  only,  and  that  the  services  per- 
formed by  I'ritchett  in  the  foreclosure  suit 
of  Max  >Meyer  &  Bro.  for  the  appellee  were 
necessaries,  and  that,  therefore,  the  appellee 
cannot  avoid  said  first  deed.  Were  the  seiT- 
ices  performed  by  Pritchett  for  the  appellee 
in  the  foreclosure  suit  "necessaries,"  within 
the  meaning  of  that  term?  What  are  neces- 
saries for  an  infant  cannot  be  defined  by 
any  general  rule  applicable  to  all  cases.  It 
is  a  mixed  question  of  law. and  fact,  to  be 
determined  in  each  case  from  the  particular 
facts,  circumstances,  and  surroundings  in 
that  case.  In  Shelton  v.  Pendelton,  18  Conn. 
417.  a  wife,  without  her  husband's  consent, 
employed  an  attorney  to  prosecute  a  suit  for 
divorce  in  her  favor,  against  her  husband, 
for  a  legal  and  sufficient  cause.  The  attor- 
ney performed  the  services,  and  the  decree 
of  divorce  was  granted.  The  attorney  then 
sued  both  the  husband  and  wife  for  his  fees. 
The  court  held  that  the  services  rendered 
were  not  necessaries,  and  that  the  husband 
was  not  liable  therefor.  The  coiu't  said: 
"By  the  law  the  defendant  is  liable  only  for 
the  necessaries  which  the  plaintiff  has  pro- 
vided for  his  wife.  The  common  law  de- 
fines 'necessaries'  to  consist  only  of  neces- 
sary food,  clothing,  drink,  washing,  medi- 
cine, instruction,  and  a  competent  place  of 
residence."  In  Munson  v.  Washband,  31 
Conn.  303,  a  female  infant  was  seduced  un- 
der a  promise  of  marriage.  Her  seducer 
refiised  to  marry  her,  and  she  was  left  in  a 
state  of  destitution.  At  her  request  an  at- 
torney brought  suit  against  the  seducer  for 
a  breach  of  promise  of  marriage.  The  suit 
was  settled  by  the  intermarriage  of  the 
plaintiff  and  defendant.  The  attorney  then 
sued  both  the  husband  and  the  wife  for  his 
services.  The  court  held  that  the  services 
rendered  by  the  attorney,  under  the  circum- 
stances, were  "necessaries,"  within  the 
meaning  of  that  term.  The  com-t  said: 
"Can  the  plaintiff's  charges  for  prosecuting 
that  action  be  considered  as  necessaries,  mi- 
der  the  circumstances?  The  rule  usually 
stated  in  the  text-books  confines  the  term 
'necessaries.'  for  which  a  minor  may  bind 
himself,  to  suitable  food  and  clothing,  shel- 
ter, washing,  medicine,  medical  attendance, 
and  education;  but  this  depends  entirely  up- 
on what  the  coiu-t  or  .im\v  may  think,  in  each 
case,  suitable  and  proper  in  reference  to  the 
infant's  condition  and  station  in  life.  *  *  * 
The  personal  security  of  the  wife  is  legally 
a  necessary,  and  the  expense  of  seciu'ing  it 
is  a  proper  charge  against  the  husl)and.  If 
we  look  at  the  suit  which  the  infant  com- 


INFANTS. 


53 


mcncpcl  as  lior  ouly  iiiodo.  undor  hor  peculiar 
circumstances,  of  procuring  tlic  means  of  liv- 
ing, it  comes  witliin  tlie  iHJnciple  allowing 
ber  to  contract  for  n(>cessr.ries.  This  was 
not  a  case  of  merely  prosecuting  an  infant's 
right  to  property,  or  for  recovery  of  an  ordi- 
nary debt.  In  such  cases  there  is.  or  ought 
to  be,  a  guardian  to  protect  the  interests  of 
the  infant.  There  was  none  here,  and  it 
does  not  appear  that  ther(>  were  any  means 
practicable  of  procuring  one  to  be  appointed. 
It  appears  to  us.  therefore,  that  while  the 
coiu't  recognized  the  rule  that  the  ordinary 
fee  of  an  attorney  for  the  prosectiting  of  an 
infant's  right  to  property  could  not  generally 
be  .said  to  be  a  necessary,  yet  it  correctly  in- 
formed them  that  the  services  rendered  were 
requisite  for  the  personal  protection  and  sup- 
port of  the  infant,  and  might  be  lawfully 
soutracted  for  by  her.  and  that  she  would 
be  liable  to  pay  for  the  same."  In  Wallis 
V.  Bard  well,  120  Mass.  300,  it  was  held  "that 
a  ward  is  not  liable  for  repairs  put  upon 
his  dwelling  house  by  a  person  employed  by 
the  guardian  to  make  them,  even  after  the 
death  of  the  guardian,  and  evidcnice  that 
repairs  were  necessary  is  immaterial."  In 
Tupper  V.  CaldAvell.  12  Mete.  (Mass.)  .j.j9,  it 
was  held:  "An  infant  is  not  liable  for  the 
expense  of  repairing  his  dwelling  house,  on 
a  contract  made  by  him  therefor,  although 
such  repairs  were  necessary  for  the  preven- 
tion of  immediate  and  serious  injury  to  the 
house."  The  court  said:  "An  infant  may 
make  a  valid  contract  for  necessaries,  and 
the  matter  of  doubt  in  the  present  case  is 
what  expenditures  are  embraced  in  the  term 
'necessaries.'  It  has  sometimes  been  con- 
tended that  it  was  enough  to  charge  the 
party,  though  a  minor,  that  the  contract  was 
one  plainly  beneficial  to  him,  in  a  pecuniary 
point  of  view.  That  proposition  is  by  no 
means  trtie,  if,  by  it,  it  be  intended  to  sanc- 
tion an  iu(iuiry,  in  each  partictilar  case,  as 
to  wh(>ther  the  expenditm-es  or  articles  con- 
tracted for  were  beneficial  to  the  pecuniary 
interest  of  the  minor.  The  expenditures  are 
to  be  limited  to  cases  where,  from  their  very 
natiu-e,  expiuiditures  for  such  purposes  would 
be  beneficial,  or.  in  other  words,  they  nmst 
belong  to  a  class  of  expenditures  which  are. 
in  law,  termed  'beneficial  to  the  infant.' 
What  subjects  of  expenditures  are  included 
in  this  class  is  a  matter  of  law.  to  be  decided 
by  the  court.  The  further  in(iuiry  may  often 
arise,  whether  expenditures,  though  em- 
braced in  this  class,  were  necessary  and 
proper  in  the  particular  case,  and  this  may 
present  a  question  of  fact.  It  is  therefore  a 
preliminary  question  to  be  settled,  whether 
the  alleged  liability  arises  from  expenditiu-es 
for  what  the  law  deems  necessaries;  and. 
unless  that  be  shown,  it  is  not  competent  to 
introduce  evidence  to  show  that,  in  a  pec-un- 
iary  point  of  view,  the  expendifiu-e  was 
beneficial  to  the  minor."  See,  also.  Price 
V.  Sanders.  00  Ind.  810;  Mathers  v.  Dob- 
schuetz,    72  111.   43S;    Bloomer   v.    Nolan,    30 


Neb.  ,")1.  .-.3  N.  W.  10.30.  In  Turner  v.  (^a:th- 
er.  S3  N.  C.  3.")7,  it  was  held  that  money  fur- 
nished an  infant  to  enable  him  to  acquire  a 
professional  education  was  not  a  necessary. 
In  Decell  V.  Lewenthal.  57  Miss.  .331.  it  was 
ludd  that  money  furnished  an  infant  to  en- 
able him  to  carry  on  a  plantation  was  not 
a  necessary.  In  Barker  v.  Hibbard.  .">4  N. 
II.  r»:;i>.  it  was  held  that  the  services  reiMh-r- 
ed  by  an  attorney  in  defending  an  infant  in 
a  bastardy  proceeding  were  n(>cessaries.  In 
Auding  V.  Levy.  .17  Miss.  5.j.  it  was  held  that 
where  an  infant  had  no  guardian,  and  the 
services  rendered  by  an  attorney  were  bene- 
ficial to  the  infant's  estate,  he  was  liable  for 
such  services.  In  Connolly  v.  Hull.  3  Mc- 
Cord.  G,  and  in  Kline  v.  L'Amoreux,  2  Paige, 
410,  it  was  held  that  if  an  infant  was  living 
with  his  i)arents  or  guardian,  and  proiterly 
maintained  by  them,  his  contract,  even  for 
necessaries,  was  not  binding.  In  the  case 
at  bar,  when  the  appellee  made  the  first 
deed  to  Pritchett.  in  consideration  that  he 
would  defend  the  Max  Meyer  &  Bro.  mort- 
gage foreclosm-e  suit,  he  wac  living  with  his 
father,— his  natural  guardian;  so  that,  if  we 
held  that  the  services  rendered  by  Pritchett 
in  the  foreclosure  suit  were  necessaries,  still 
the  appellee  wotild  not  be  bound  to  pay  for 
the  services,  if  this  was  a  suit  by  Pritchett 
on  the  contract  made  for  that  piirpose.  In 
the  light  of  the  authorities  quoted  above  up- 
on this  subject,  we  are  clearly  of  the  opinion 
that  the  services  rendered  by  ^Ir.  Pritchett 
in  the  foreclosure  suit  cannot  be  considered 
necessaries,  inider  the  facts  of  this  case. 

Another  contention  of  the  appellants  is 
that  the  appellee  has  not  restored  the  con- 
sideration he  received  from  Pritchett  for  the 
execution  of  the  tAvo  deeds  which  he  seeks 
to  cancel  bj'  this  suit,  and  that,  therefore, 
he  cannot  maintain  this  action.  There  are 
many  authorities  which  hold  that  it  is  not 
necessary— to  enable  an  infant,  on  coming  of 
age,  to  disaffirm  a  contract  made  during  his 
minority — to  restore  or  return,  or  offer  to  re- 
store or  return,  as  a  condition  precedent  to 
his  right  to  disaffirm  such  contract,  the  cmi- 
sideration  which  he  received  therefor;  but 
the  rule  of  this  coinl  is  otherwise.  In  Phil- 
pot  V.  Manufacturing  Co..  18  Neb.  54,  24  N. 
W.  428,  the  rule  is  tluis  stated:  "If  an  in- 
fant purchase  personal  proiterty,  and  give 
his  note  therefor,  he  cannot  upon  arriving  at 
the  age  of  twenty-one  years,  retain  the  prop- 
erty, and  jdead  infancy  as  a  defense  to  the 
note."  This  is  a  somewhat  loose  statemnt 
of  the  rule.  The  rule  is  c(mcisely  and  cor- 
rectly stated  by  Post.  J.,  in  Bloomer  v.  No- 
lan. 30  Neb.  51,  53  N.  W.  1030.  in  this  lan- 
gtiage:  "One  who  seeks  to  disaffirm  a  con- 
tract on  the  ground  that  he  was  an  infant  at 
the  time  of  its  execution  is  reciuired  to  re- 
tiu-n  so  mucli  of  the  consideration  received 
by  him  as  remains  in  his  possession  at  the 
time  of  such  election,  but  is  not  reiiuired  to 
return  an  equivalent  for  such  part  thereof 
as  may  have  been  disposed  of  by  him  during 


^i 


INFANTS. 


his  miuority."  That  is  to  say,  the  infant,  on 
coming  of  age,  and  electing  to  disaffirm  a 
contract  made  by  him  during  his  minority, 
must  restore  or  return  so  much  of  the  con- 
sideration received  by  liim  in  consiiU'ration 
of  exeeuting  the  contract  as  he  then  has,  in 
specie,  in  liis  possession.  The  language  of 
the  authorities  is  that  he  must  return  or  re- 
store whateA'er  of  the  consideration  he  then 
has,  not  that  he  is  to  pay  to  tlie  party  with 
wlu)m  he  made  the  contract  an  equivalent 
for  that  which  he  received  from  said  party. 
In  Kc>ynolds  v.  McCurry,  100  111.  S.jtJ.  the  rule 
is  thus  stated:  '"It  is  a  general  rule  that 
where  the  consideration  of  a  conveyance  by 
:ui  infant  has  been  expended,  so  that  he  is 
not  in  a  condition  to  restore  it,  he  may  nev- 
♦'rtliele.ss  avoid  the  conveyance.  It  is  only 
wlien  he  still  has  the  consideration  that  he 
will  be  compelled  to  return  it."  See.  also, 
Miller  v.  Smith.  2(i  Minn.  24S,  2  N.  W.  942. 
In  ("handler  v.  Simmons,  07  Mass.  i^OS,  the 
rule  is  stated  in  this  language:  "If  money 
paid  to  a  minor  as  a  consideration  for  his 
conveyance  of  real  estate  has  been  wasted 
or  spent  by  him  during  his  minority,  pay- 
ment or  tender  of  the  amovmt  is  not  neces- 
sary, to  enable  him  to  avoid  the  convey- 
ance." The  Iowa  Code  provides  that  a 
minor  is  bound  by  his  contract,  imless  he  dis- 
utHrms  it,  and  restores  to  the  other  party  all 
money  or  property  received  by  him  by  vir- 
tue of  his  contract,  and  remaining  within  his 
control.  Construing  this  section  of  the  Code, 
the  supreme  court  of  Iowa,  in  Hawes  v. 
Railroad  Co.,  64  Iowa,  31.5,  20  N.  W.  717, 
held  that,  where  a  minor  had  disaffirmed  a 
contract,  he  was  only  required  to  return  the 
Identical  money  or  property  received  by  him 
for  the  execution  of  such  contract  remaining 
in  his  possession  at  the  time  of  his  disaffirm- 
ance thereof.  The  court  said:  "It  is  not 
shown  or  pretended  that  he  had  remaining 
under  his  control,  at  any  time  after  attaining 
his  majority,  the  money  or  property  received 
by  him  by  virtue  of  the  contract,  and  it  is 
only  such  money  or  property  as  may  thus 
remain  that  he  is  bound  to  restore." 

So  far  as  the  consideration  for  the  first 
•deed  made  by  the  appellee  to  Pritchett  is 
concerned,  the  only  consideration  which  it  is 
■claimed  appellee  receivwi  for  such  deed  was 
the  services  rendered  by  Mr.  Pritchett  in  de- 
feuding  the  Max  Meyer  &  Bro.  foreclosure 
suit.  There  are  several  things  to  be  said 
of  those  services.  In  the  first  place,  but  for 
the  voluntary  intervention  of  Mr.  Pritchett 
in  that  suit,  we  are  led  to  believe,  from  the 
record  before  us,  that  Max  Meyer  &  Bro. 
would  have  proceeded  to  decree  of  ft)reclo- 
sm'e  against  the  father  and  mother  of  ap- 
I)ellee  only,  notwithstanding  that  the  appel- 
lee's mother  was  dead  at  the  time  the  fore- 
closure suit  was  brought,  and  the  title  to  the 
real  estate  had  vested  in  the  appellee.  Such 
a  decree  would  not  have  been  binding  upon 
the  appellee,  and  would  not  have  deprived 
iiim    of    the   right,    at  least,    to    redeem    his 


property  from  such  decree,  if  such  decree 
would  have  in  any  manner  interfered  with 
appellee's  title.  Again,  at  the  time  Mr. 
Pritchett  rendered  these  services,  he  was  an 
officer  of  the  com't  in  which  the  foreclosure 
suit  was  pending,  and  had  been  by  the  com-t 
appointed  guardian  ad  litem  for  the  appellee. 
He  had  accepted  this  appointment,  and  was 
acting  for  the  appellee.  Section  14,  c.  7, 
Comp.  St.  1893,  then  and  now  in  force,  i)ro- 
rides:  "It  shall  be  the  duty  of  every  attor- 
ney to  act  as  the  guardian  of  any  inftint  de- 
fendant in  any  suit  pending  against  him 
when  appointed  for  that  purpose  by  order  of 
the  court;  he  shall  prepare  himself  to  make 
the  proper  defense  to  guard  the  rights  of 
said  defendant  and  shall  be  entitled  to  such 
compensation  as  the  com*t  shall  deem  rea- 
sonable." In  view  of  this  statute,  and  in 
view  of  the  circumstances  under  which  Mr. 
Pritchett  rendered  the  services  for  the  ap- 
pellee in  the  foreclosure  suit,  we  are  con- 
strained to  say  that,  if  such  services  had 
been  necessaries,  nevertheless  the  appellee's 
contract,  by  which  he  paid  Pritchett  one- 
half  tlie  real  estate  in  litigation  in  consider- 
ation of  the  services,  Avould  hav^  still  been 
voidable,  at  the  suit  of  the  appellee.  It  was 
the  duty  of  Pritchett  to  render  the  services 
he  did.  This  was  a  duty  imposed  upon  hira 
by  law,  and  resulting  from  his  profession. 
P"'or  performing  the  duties  of  a  guardian  ad 
litem,  an  attorney  nuist  look,  and  look  only, 
for  the  amount  of  his  compensation,  to  the 
court;  and  the  compensation  allowed  the 
guardian  should  be  taxed  as  costs  in  the  pro- 
ceeding, and  as  such  collected.  Perhaps  it 
might  be  filed  as  a  claim  against  the  minor 
estate,  but  no  other,  different,  or  greater 
amount  can  be  collected  than  that  allowed 
by  the  court.  Whatever  may  be  said  of  the 
services  rendered  by  Mr.  Pritchett  in  the 
foreclosure  suit  for  the  appellee,  such  serv- 
ices, of  course,  cannot  be  returned  in  kind. 

The  consideration  for  the  second  deed  was 
$240  in  money  paid  by  Pritchett  to  appellee's 
father.  It  is  not  claimed  or  pretended  that 
this  money,  or  any  part  of  it,  ever  came  into 
the  possession  of  the  appellee.  It  appears 
that  the  appellee's  father  bought  a  piano 
with  this  money,  and  gave  it  to  appellee, 
and  that  he  still  has  it.  But  the  appellee 
was  under  no  legal  obligations  to  offer  or 
tender  or  surrender  this  piano  to  Pritchett, 
as  a  condition  precedent  to  his  right  to  dis- 
affirm the  deed.  Nor  was  the  appellee  un- 
der any  legal  obligation,  as  a  condition  pre- 
cedent to  his  right  to  disaffirm  the  deed,  to 
repay  Pritchett  the  money  which  he  had  paid 
appellee's  father  in  consideration  of  the  exe- 
cution of  the  deed.  At  the  time  appellee 
disaffirmed  these  deeds  and  brought  this 
suit,  there  was  in  his  possession  no  part  of 
the  consideration  parted  with  by  Pritchett 
at  the  time  appellee  executed  the  deeds. 

The  final  contention  of  the  appellants  is 
that,  the  appellee  having  executed  the  deeds, 
he  is,  in  equity,  estopped  from  disatfirming 


INFANTS. 


55 


tlicm.  as  asainst  inuucciit  imrchasors.  This 
is  a  remarkable  argument,  iu  view  of  the 
reeoi'd  in  this  case.  Not  one  of  the  appel- 
lants is  an  innocent  i)ur(ha.ser  of  any  part 
of  this  propertj-,  in  any  sense  whatsoever. 
There  is  in  all  this  record  not  one  word  of 
ovidence  that  the  appclltv,  by  any  act  or 
omi.ssion  of  his,  either  before  or  after  his 
coming  of  age,  induced  either  of  the  apjx'l 
JniiN  to  pnrchas<'  any  of  the  property  in  this 
suit.  Certainly  the  appellants,  as  purchas- 
ers of  this  property,  were  bound  by  such  no- 
tice as  the  public  records  of  Douglas  county 
afforded  of  the  fact  of  the  infancy  of  the  ap- 
pellee. Had  appellants,  intending  to  Diu*- 
chase  this  property,  exercised  ordinary  care, 
and  looked  into  the  records  of  Douglas  coun- 
ty as  to  the  title  of  this  property,  they 
would  have  found  the  title  to  the  same  in 
ippellee's  mother  in  1874.  They  would  have 
found  the  record  of  the  foreclosiu-e  suit  of 
Max  Meyer  &  Bro.  They  would  have  foimd 
that  the  decree  in  that  case  found  that  the 


title  of  this  property  had  passed  to  appellee; 
that  he  was  at  that  time  an  infant.  They 
would  have  found  the  first  deed  from  appel- 
lee to  Pritchett.  antedating  the  decree  iu  the 
foreclosure  suit.  They  would  have  found  of 
record  in  the  otfiee  of  the  probate  com-t  of 
Douglas  county  the  very  day  and  hour  of 
appellee's  birth;  the  finding  by  that  court 
that  appellee  was  a  minor  in  ISSS,  giving  his 
age;  the  appointment  by  that  court  on  tli.-it 
date  of  Pritehett,  as  his  guardian.  Certain- 
ly, these  records  were  sufficient  to  have  pro- 
tected the  appellants,  had  they  looked  for 
them.  If  they  did  not  examine  the  records, 
and  chose  to  rely  upon  the  ability  of  their 
grantors  to  make  good  the  title  for  them, 
they  have  no  one  of  whom  to  complain. 
Certainly,  they  are  in  no  position  to  invoke 
the  aid  of  this  court  in  this  case  to  protect 
them  as  innocent  purcha.sers;  and,  besides, 
there  is  no  such  thing  as  an  innocent  pm-- 
chaser  of  a  minor's  property.  The  dcnree  of 
the  district  court  is  attirmed.    Atiirmed. 


00 


INFANTS. 


WOOD  V.  LOSEY. 
(15  N.  W.  or>7,  50  Mich.  475.) 
Supreme  Court  of  Michigan.     April  25,  1883. 
Error  to  circuit  court,  Jackson  county. 
A.    B.    Haynes,    for   appellant.     Hammoml, 
Barkworth  &  Smith,  for  appellee. 

CA.MPBELL,  J.  Defendant  was  sued  for 
the  price  of  a  horse  sold  liiui  by  Turnery  Wood, 
a  brother  of  plaintiff,  who  claimed  as  assignee. 
Tlie  suit  was  brought  before  a  justice  while 
the  defendant  was  an  infant,  and  tliis  appears 
of  record.  He  was  still  an  infant  when  the 
judgment  rendered  against  him  by  the  justice 
was  appealed.  Judgment  was  rendered  against 
him,  also,  in  the  circuit  court  for  Ingham  coun- 
ty. It  appeared  that  defendant  had  been  gar- 
nished by  a  creditor  of  Emery  Wood,  and  had 
paid  the  money  over.  But  in  the  present  suit 
this  was  not,  so  far  as  appears,  established  to 
have  been  before  some  notice  of  the  assign- 
ment. Defendant  was  also  prevented,  by  the 
ruling  of  the  court,  from  showing  fraud  in  the 
assignment.  If  the  case  could  stand  unreversed 
upon  the  other  matters,  we  should  v.ish  to  con- 
sider whether  a  garnishee  who  has  disclosed 
and  paid  over  money  to  creditors  would  not 
be  entitled,  when  sued  en  the  same  debt,  to 
show  that  the  assignment  was  not  valid  as 
against  the  creditors  who  garnished  him,  and 
who  had.  if  it  was  fraudulent,  a  right  to  com- 
plain themselves  of  the  assignment.  While 
we  do  not  lind  ourselves  called  on  to  pass  upon 
this  allegation  of  error,  we  do  not  wish  to 
have  it  understood  that  it  is  regarded  as  un- 
founded.    We  leave  it  for  future  consideration. 

We  think  the  jury  was  clearly  misled  by  the 
course  taken  below  on  the  subject  of  infants' 
conti'acts.  W^hile  the  court  in  the  charge  did 
undoubtedly  charge  that  the  plaintiff  must 
show  the  horse  to  have  been  a  necessity  to  the 
defendant,  the  force  of  this  was  destroyed  by 
the  other  charges  and  refusals  to  charge.  The 
plaintiff— altliough  the  defendant  appeared 
only  as  an  infant  and  his  infancy  was  admit- 


ted—made no  attempt  to  do  any  more  than 
prove  the  sale  of  tlie  horse  as  if  made  to  a 
person  of  full  age.  When  he  rested  he  had 
made  out  no  cause  of  action.  If  he  recovered 
at  all  it  could  only  be  because  the  defendant 
(who  was  very  unnecessarily  called  on  by  who- 
ever represented  his  interests  to  show  by  way 
of  defense  wliat  the  law  presumed  in  his  fa- 
vor) made  out  a  clear  case  of  necessity.  The 
fact  that  the  defendant  assumeu  the  buiden 
did  not  in  any  way  exonerate  plaintiff  from 
making  out  a  full  case  of  actual  necessity. 
The  burden  did  not  cease  to  be  the  plaintiff's 
burden.  Defendant  showed  that  he  was  car- 
rying on  his  mother-in-law's  farm  for  a  third 
of  the  produce,  and  that  she  was  to  furnish  all 
the  teams,  tools,  and  implements.  He  had  no 
other  business. 

This  showed  quite  clearly  that  the  horse  was 
not  necessary  for  defendant,  and  the  court 
should  not  have  refused  to  so  charge.  By  re- 
fusing this  chai'ge,  and  by  giving  the  jury  to 
understand,  as  we  think  they  could  not  fail 
to  understand,  that  it  was  the  necessity  for 
the  farming  business,  and  not  the  necessity  for 
the  defendant's  part  in  it,  that  would  make 
him  liable,  they  were  led  to  a  verdict  which 
has  no  testimony  to  sustain  it.  We  have  had 
some  doubt  whether  we  could  properly  grant 
a  new  trial  u])ou  the  reversal.  The  defendant 
was  not  brought  into  the  case  so  as  to  be  im- 
pleaded in  the  way  the  statute  points  out. 
The  guardian  does  not,  on  the  original  record, 
appear  to  have  been  properly  appointed,  and 
he,  and  net  the  defendant,  had  charge  of  the 
original  defense  and  appeal.  We  are  strong- 
ly inclined  to  regard  the  whole  proceedings  as 
too  defective  to  bear  investigation.  Defend- 
ant did  not  assign  error  on  this  point,  but  it  is 
open  on  the  record,  where  the  issues  indicate 
error,  and  may  stand  in  the  way  of  any  future 
judgment  for  plaintiff.  As  the  assignments  of 
error  now  stand,  we  shall  reverse  the  judg- 
ment, with  costs  of  both  courts  up  to  this 
time,  and  allow  a  new  trial,  if  the  plaintiff 
sees  fit  to  incur  the  risk. 

The  other  justices  concurred. 


HABITUAL  DltUXKAllUS. 


57 


BKOCKWAY  V.  JEWELL. 

(39  X.  E.  470.  .52  Ohio,  1S7 ) 

Supreme  Court  of  Ohio.     Dec.  18.  1R04. 

Error  to  circuit  court,  Trumbull  county. 

Action  by  one  Jowell,  i^;uardian,  ai^ainst 
James  W.  Brockway.  There  \va.s  a  judg- 
ment of  the  circuit  court  reversing  a  judg- 
ment of  the  common  pleas  for  defendant,  and 
he  brings  eri-or.  Judgment  of  the  circuit  court 
reversed,  and  that  of  the  common  plea.s  af- 
firmed. 

The  action  below  was  commenced  before 
a  justice  of  the  peace  by  defendant  in  error 
against  plaintiff  in  error,  in  replevin,  to  re- 
cover a  single  harness,  with  gilt  trimmings. 
On  appeal  to  the  court  of  common  pleas  the 
plaintiff  below  filed  his  petition,  the  defend- 
ant below  filed  his  answer,  but  there  was 
no  reply.  A  trial  before  a  jury  i-esulted  in  a 
verdict  for  defendant  below,  finding  him  to 
be  the  owner  of  the  harness,  and  assessing  his 
damages  at  $30.  A  motion  for  a  new  trial 
was  filed  by  the  plaintiff  below,  the  seventh 
ground  of  whicu  is  founded  upon  a  supposed 
error  in  the  charge  of  the  court,  appearing 
in  the  opinion  later  on.  The  motion  for  a 
new  trial  was  overruled,  and  judgment  ren- 
dered on  the  verdict,  to  which  plaintiff  be- 
low excepted,  and  filed  his  petition  in  eiTor 
in  the  circuit  court  of  TnimbuU  county, 
which  court,  on  hearing  the  case,  reversed 
the  judgment  on  the  sole  ground  that  the 
court  of  common  pleas  erred  in  giving  the 
charge  as  set  out  in  the  seventh  ground  of 
the  motion  for  a  new  trial.  Thereupon  de- 
fendant below  (plaintiff  in  error  here)  filed 
his  petition  in  error  in  this  court  to  reverse 
the  judgment  of  reversal  of  the  circuit  court. 

C.  S.  Darrow  and  E.  B.  Leonard,  for  plain- 
tiff in  error.  George  H.  Tuttle,  for  defend- 
ant in  error. 

BURKET.  J.  (after  stating  the  fact.-^).  The 
facts  and  circumstances  out  of  which  this 
action  grew,  as  shown  by  the  record,  are  as 
follows:  On  and  before  March  1,  ISS.j,  Grove 
B.  Clark  and  the  defendant  below,  Jami's 
W.  Brockway,  were  close  friends,  and  fre- 
quently went  about  the  countiy  together. 
Mr.  Clark  had  inherited  quite  a  fortune,  and 
fell  into  the  habit  of  drinking  to  excess,  and 
had  spent  some  ^lO.CMjO  of  cash,  and  often 
borrowed  of  his  friends.  Matters  grew  so 
bad  that  on  the  2d  day  of  March,  1885.  ap- 
plication was  made  to  the  probate  court  of 
Trumbull  county  for  the  ap])ointment  of  a 
guardian  for  Mr.  Clark,  on  the  ground  that 
he  was  an  inebriate.  Notice  of  this  applica- 
tion was  served  on  Mr.  Clark  on  the  4th  or 
5th  day  of  March,  and  Mr.  Broc-kway  had  no- 
tice of  the  application  on  the  same  day.  The 
application  was  set  for  hearing  on  March 
9th.  and  was  continued,  and  the  appointment 
of  the  guardian  was  finally  made  on  March 
23,  1885.  About  the  last  of  FebruaiT,  1885, 
Mr.  Clark  took  sick  at  the  Sawdy  Hotel,  at 


Kinsman,  in  Trumhn'l  county,  and  was  in  a 
condition  to  recpiire  the  services  of  a  nurse 
to  wash  and  cleanse  him  and  his  clothes  and 
bed,  and  ho  employed  the  defendant  below 
to  nurse  him  during  his  sickness,  and  in  pay- 
ment for  his  services  agreed  to  supplj'  him 
with  a  harness.  Defendant  accepted  the  em- 
ployment on  the  terms  named,  and  at  once 
went  to  the  harness  shop,  and  looked  over  the 
stock  on  hand,  and,  among  others,  the  har- 
ness in  question,  but  made  no  selection  at 
that  time.  Defendant  nursed  Mr.  Clark  for 
about  two  weeks  from  and  after  the  last  daj' 
of  February  or  1st  day  of  March,  under  and 
in  pursuance  of  this  contract  between  them. 
On  the  loth  day  of  March,  Mr.  Clark  gave 
defendant  below  an  order  on  the  harness 
maker  for  the  harness,  which  was  presented 
the  same  day,  and  not  honored.  Thereupon 
Mr.  Clark  and  defendant  on  the  same  day 
went  to  the  harness  shop  together,  and  Mr. 
Clark  requested  the  harness  maker  to  lot  de- 
fendant have  the  harness,  which  was  agreed 
to.  Afterwards,  on  the  same  day,  the  har- 
ness maker  delivered  the  harness  to  defend- 
ant, in  the  absence  of  Mr.  Clark,  and  after- 
wards, on  tJie  sr.me  day.  in  the  absence  of  de- 
fendant, received  from  Mr.  Clark  his  note 
for  $30  for  the  harness.  Defendant  retained 
the  harness  until  about  May  1,  1885,  when  it 
was  taken  from  him  in  this  action  of  re- 
plevin. 

The  petition  in  the  common  pleas  avers  that 
defendant,  at  the  commencement  of  this  ac- 
tion, and  for  10  days  before  that  time,  wrong- 
fully detained  from  plaintiff  the  following 
goods  and  chattels  of  the  plaintiff,  as  guard- 
ian, to  wit,  one  single  harness,  with  gilt 
trimmings.  It  will  be  noticed  that  this  pe- 
tition does  not  claim  that  the  defendant  de- 
tained the  property  for  a  longer  period  than 
10  days  before  the  suit  was  commenced,  and 
does  not  aver  that  plaintiff,  as  such  guardian, 
was  owner  of  the  harness  for  a  longer  pe- 
riod than  the  10  days  during  which  the  prop- 
erty was  so  detained.  The  answer  admits 
that  the  case  came  into  court  by  appeal,  and 
denies  each  and  every  other  allegation  there- 
in contained.  The  answer  further  avers 
that  at  the  time  of  the  commencement  of  the 
action  the  defendant  was  lawfully  in  posses- 
sion of  the  harness;  that  he  was  the  owner 
thereof,  and  that  it  was  delivered  and  given 
to  him  in  good  faith,  as  a  consideration  for 
necessaries  furnished  to  Gi'ove  E.  Clark,  who 
was  then  owner  of  the  same;  and  that  said 
necessaries  so  furnished  consisted  of  care 
and  nursing  of  .said  Clark  while  ho  was  in 
a  fit  of  sickness.  The  ownership  and  rightful 
possession  of  the  harness  at  the  time  of  the 
commencement  of  the  suit,  and  for  10  days 
previous  thereto,  is  clearly  put  in  issue  by 
both  the  general  denial  and  the  further  aver- 
ment that  defendant  was  the  owner  and  had 
lawful  posse&>;ion  thereof,  and  this  is  as  far 
as  any  issue  is  made  up  by  the  pleadings. 
The  defendant  goes  further  in  his  answer, 
and  shows  how  he  became  owner,  and  avers 


■bH 


II A B I T U A L  BRU N K A R DS . 


that  .Ml".  Clark  was  owner  of  tlio  harness  at 
the  time  it  was  delivered  to  defendant  as 
a  consideration  for  necessaries  furnished  to 
him.  No  reply  appears  in  the  record,  so 
that  the  manner  of  acfpiirin;;-  ownership  is 
not  denied;  and  it  stands  admitted  that  the 
harness  was  delivered  and  given  to  defend- 
ant in  pood  faith,  as  a  consideration  for  care, 
nin-sinji.  and  neceissaries  furnished  to  Mr. 
Clark  while  he  was  in  a  fit  of  sickness.  The 
time  of  the  sickness  and  of  the  delivery  of 
the  harness  does  not  appear  in  the  pleadings, 
hut  the  testimony  shows  that  it  was  the  last 
day  of  February  or  forepart  of  March,  as 
above  stated. 

There  is  no  inconsistency  in  the  pleadings, 
and  the  latter  part  of  the  answer  does  not 
modify  or  contradict  the  general  denial. 
While  the  answer  avers  that  at  some  time 
Mr.  Clark  was  owner  of  the  harness,  and 
that  he  delivered  it  to  defendant  below,  it 
was  claimed  upon  the  trial,  as  one  defense, 
that  the  title  to  the  harness  was  never  in 
Mr.  Clark,  but  passed  directly  from  the  har- 
ness maker  to  the  defendant;  and  evidence 
was  introduced,  without  objection,  and  the 
trial  proceeded  upon  that  theory,  notwith- 
standing the  state  of  the  pleadings.  If  the 
charge  of  the  court  excepted  to  had  reference 
to  this  phase  of  the  case,  as  so  made  by  the 
-evidence,  it  was  clearly  right,  because,  if 
defendant  below  did  not  derive  title  to  the 
harness  from  Grove  E.  Clark,  but  from  the 
harness  maker,  his  title  was  unimpeach- 
able. That  the  court  had  the  right  to  submit 
the  case  to  the  jui-y  upon  the  evidence  in- 
troduced, notwithstanding  tlie  state  of  the 
pleadings,  is  shown  by  the  case  of  Mehurin 
V.  Stone,  37  Ohio  St.  49-.58.  As  anotlier  phase 
of  the  case,  the  defendant  belovi  claimed  that 
the  contract  of  hiring  and  promise  to  pay  for 
the  services  rendered  by  delivei-j-  of  the  har- 
nes.s  completed  the  sale,  if  sale« there  was, 
as  of  the  date  of  the  hiring,  even  though 
the  harness  was  handed  over  by  the  harness 
maker  some  days  later.  As  still  another 
phase  of  the  case,  the  defendant  below  re- 
garded the  delivery  of  the  harness  as  a  pay- 
ment foi'  services  rendered  under  a  contract 
made  before  application  was  made  for  the 
appointment  of  a  guardian  for  Mr.  Clark. 
Opposed  to  these  three  phases  of  defense, 
the  plaintiff  below  regarded  the  transaction 
as  a  sale  of  the  harness  by  Mr.  Clark  to  de- 
fendant below,  after  notice  of  the  application 
for  the  appointment  of  a  guardian,  and  there- 
fore void  under  the  statute. 

Upon  the  plia.se  of  a  sale  of  the  property 
as  claimed  by  the  parties  the  coiu-t  charged 
the  .iury  as  follows:  "The  court  say«  to  you, 
as  matter  of  law,  that  to  constitute  a  valid 
sale  of  tliis  harness  by  Clark  to  Brockway 
it  must  have  been  before  Brockway  had  no- 
tice of  the  application  for  the  appointment 
of  a  guardian  for  Clark,  and  any  sale  after 
notice  upon  Brockway  would  confer  no  title 
upon  the  defendant."  To  this  charge  there 
was  no  exception.     Upon   the  phase  of  the 


case  that  the  delivery  of  tlie  harness  was  in 
payment  of  the  .services  rendered  under  the 
contract  of  hiring,  the  court  charged  the  jury 
as  follows:  "You  are  further  instructed  that 
if  you  find  from  the  evidence  that  Grove  E. 
Clark  and  the  defendant  entered  into  an 
agreement,  prior  to  the  time  of  the  filing  of 
this  application  for  guardian,  or  before  he 
had  notice  of  the  same,  that  in  considera- 
tion of  services  rendered  by  the  defendant 
said  Grove  E.  Clark  would  purchase  a  har- 
ness for  the  defendant,  and  that  pursuant  to 
such  an  agreement  the  services  were  ren- 
dered as  agreed,  and  that  said  harness  was 
selected  by  the  defendant,  and  delivered  to 
him  by  .lames  Clark  (the  harness  maker), 
upon  the  order,  either  verbal  or  written,  of 
said  Grove  E.  Clark,  and  that  the  harness 
remained  in  the  possession  of  the  defendant 
until  taken  on  the  writ  of  rejdevin  In  this 
case,  then  you  should  find  for  the  defendant, 
and  assess  him  such  damages  as  is  shown  to 
you  that  this  proi)erty  was  worth  at  the  time 
it  was  taken."  There  was  an  exception  to 
this  part  of  the  charge,  which  resulted  in 
the  reversal  of  the  judgment  of  the  court  of 
common  pleas.  A  transfer  of  property  for 
cash  is  a  sale  by  one  and  a  purchase  by  the 
other.  It  is  not  a  sale  by  both,  nor  a  pur- 
chase by  both.  A  party  who  hires  a  hand 
may  pay  him  in  cash  or  personal  property, 
and  the  receipt  of  the  property  instead  of 
cash  is  not  a  purchase  by  the  hand,  but  a 
payment  to  him.  Whether  a  delivery  of  the 
harness  to  defendant  below  was  a  sale  or 
payment  depends  upon  tlie  circumstances.  If 
Mr.  Clark  was  in  a  fit  of  sickness,  and  re- 
quired a  nm-se  to  take  care  of  him,  and  ap- 
plied to  defendant,  and  said  to  him,  '"If  you 
will  nurse  and  take  care  of  me,  I  will  give 
you  a  harness  as  compensation,"  and  defend- 
ant having  accepted  and  rendered  the  sen'- 
ice,  and  received  the  harness,  the  delivery  of 
the  harness  was  clearly  a  payment.  On  the 
other  hand,  if  the  defendant  below  desired 
to  procure  a  harness,  and  applied  to  Mr. 
Clark  therefor,  and  proposed  that  if  Mr. 
Clark  would  deliver  to  him  a  harness  he 
•would  work  for  him  to  the  value  of  the  same, 
or  nurse  and  take  care  of  him  in  payment 
therefor,  and  in  that  way  obtained  the  har- 
ness, such  transaction  was  a  sale  on  the  part 
of  Clark,  and  a  payment  on  the  part  of  de- 
fendant. There  was  evidence  strongly  tend- 
ing to  show  that  Mr.  Clark  was  seeking  a 
nui-se.  that  he  stood  in  sore  need  of  one. 
and  agreed  to  make  payment  by  the  deliveiy 
of  a  harness,  and  that  defendant  below  ac- 
cepted the  offer,  rendered  the  service,  and  re- 
ceived the  harness  as  payment  therefor. 
Such  a  transaction  is  not  prohibited  by  sec- 
tion Ci.318,  Kev.  St..  which  is  as  follows:  "At 
least  five,  and  not  more  than  ten,  days  prior 
to  the  time  when  the  application  for  the  ap- 
pointment of  the  guardian  authorized  by 
the  foregoing  section  shall  be  made,  a  notice, 
in  writing,  setting  forth  the  time  and  place 
of  the  hearing  of  the  application,   shall   be 


HABITUAL  DKL'.\KAi;i)> 


-«orvea  upon  the  person  for  whom  such  ap- 
pointment shall  be  sought;  and  from  the 
time  of  the  service  of  sucli  notice  until  the 
hearing,  or  the  day  thereof,  as  to  all  jtersons 
havins  notice  of  such  proceediufr.  no  sale, 
pi't,  conveyance,  or  incumbrance,  of  the  prop- 
erty of  such  intemperate  person  or  habitual 
<li-nnkard,  shall  be  valid."  It  will  be  noticed 
iliat  the  inebriate  is  not  prohibited  by  this 
section  of  the  statute  from  making:  either 
purchases  or  payments.  Only  sales.  j;ift.s, 
conveyances,  and  incumbrances  are  prohib- 
ited. If  the  transaction  was  as  claimed  by 
defendant,  the  charge  was  correct.     Defend- 


1  ant  had  a  ri^'ht  to  have  this  phase  of  the 
I  case  su))mitted  to  the  jury,  and  let  the  jury 
pass  upon  tiie  <piestion,  and  say  whether  ilie 
I  real  tran.saction  was  as  claimed  by  hini.self 
or  as  claimed  by  the  plaintiff.  The  pha.se 
of  tlie  transaction  as  claimed  by  eacli  was 
faii-ly  submitted  lo  the  jury.  True,  the  cliarjre 
comi.lained  of  is  not  as  dear  and  di-tiuite  as 
it  mijrlit  be,  but  clearness  would  only  have 
made  the  case  more  favorable  for  the  <le- 
fendant.  In  reversing  the  judgment  of  the 
court  of  <-omiiion  pleas  the  circuit  court  erred. 
Its  judgment  will  therefore  be  reversed,  and 
that  of  the  common  pleas  affirmed. 


60 


INSANE  PERSONS, 


STANNARD  v.  BURNS'  ADM'R. 

(22  Atl.  400,  63  Vt.  244.) 

Supreme   (,^oiirt   of    Vermont.      Rullaiid.      ilay 
1,  18!tl. 

Exceptions  from  Rutland  county  court; 
Tnft,  Jud,i;e. 

The  defendant  was  the  administrator  of 
^Michael  Burns.  The  plaintiff's  account  Avas 
for  necessaries  furnished  Burns  in  his  life- 
time, and  was  duly  presented  to  the  com- 
missioners on  his  estate,  who  disallowed  it. 
Durius  all  the  time  covered  by  the  account 
Burns  was  under  guardianship,  having  been 
adjudged  an  insane  person  by  the  probate 
coiu-t.  While  the  first  part  of  the  account 
was  accruing,  this  fact  was  not  known  to 
the  plaintiff;  afterwards,  it  was.  As  to  the 
character  of  the  insanity,  the  court  found: 
"During  the  time  covered  by  the  account 
Burns  was  a  feeble,  insane  old  man,  living 
in  his  own  house,  cared  for  by  Bridget  ]\Iau- 
ghan.  Both  Burns  and  Bridget  were  not  on 
friendly  terms  with  the  guardian;  and, 
when  the  latter  applied  to  Bridget  to  learn 
if  anything  was  needed  for  Burns,  he  was 
told  that  Burns  was  not  in  want,  and  did 
not  at  the  time  know  of  the  loans  by  the 
claimant  to  Burns  until  the  latter's  death. 
Had  Bridget  made  known  to  the  guardian 
the  wants  or  needs  of  Burns,  they  would 
have  been  supplied  by  the  guardian." 

George  E.  Lawrence  and  F.  S.  Piatt,  for 
plaintiff.  W.  H.  Preston  and  J.  C.  Baker, 
for  defendant. 

START.  J.  It  appears  from  the  state- 
ment of  facts  filed  in  the  county  court  that 
Michael  Burns  was  adjudged  an  insane  per- 
son, and  a  guardian  appointed  over  him,  in 
February,  18S8;  that  Burns  lived  in  his  own 
home,  and  was  cared  for  by  Bridget  Man- 
ghan;  that  while  Btirus  was  under  guardian- 
ship the  plaintiff  rendered  services  for  him, 
and  from  time  to  time  loaned  him  money, 
and  the  same  was  used  by  Bridget  Manghan 
in  the  purchase  of  necessaries  for  his  sup- 
port. The  statement  of  facts,  and  the  fair 
inferences  to  be  drawn  from  them,  would 
warrant  the  court  in  finding  that  the  "in- 
sanity" which  the  probate  court  found  as  a 
ground  for  appointing  a  guardian  was  not 
of  that  character  which  disqualified  the 
ward  from  entering  into  a  valid  contract  for 
necessaries.  It  does  not  necessarily  follow, 
when  there  has  been  an  adjudication  by  the 
probate  court  that  a  person  is  insane,  that 
the  insanity  is  of  that  character  which  dis- 
qualifies him  from  making  a  valid  contract 
for  necessaries.  Motley  v.  Head,  43  Vt.  (533; 
Blaisdell  v.  i^olmes.  48  Vt.  492.  In  the  last- 
named  case  the  plaintiff  was  permitted  to 
recover  of  the  defendant  for  services  ren- 
dei'ed  for  him  under  a  contract  made  with 
him  after  he  had  been  adjudged  an  insane 
person  by  the  probate  court,  and  while  he 
was  under  giiardianship.  In  Motley  v. 
Head,  supra,  the  plaintiff  sought  to  recover 


for  money  paid  out  for  the  defendant  after 
he  was  adjudged  an  insane  person,  and  while 
he  was  under  guardianship.  The  adjudi<-a- 
tion  of  insanity  was  relied  upon  in  defense, 
and  the  court  held  that  the  adjudication,  to 
be  available,  shoiild  have  been  accompanied 
with  evidence  showing  that  the  insanity  was 
of  that  character  which  disqualified  the  de- 
fendant from  making  a  valid  contract.  .ludg- 
ment  affirmed,  and  cause  certified  to  the 
probate  court. 

THOMPSON,  J.  (dissenting).  The  majori- 
ty of  the  court  aflirm  the  judgment  below 
on  the  ground  that  the  items  of  plaintiffs 
account  were  necessaries,  furnished  by  him 
to  defendant's  testate  under  such  circum- 
stances as  to  entitle  i^laintiffto  recover  there- 
for. I  am  unable  to  concur  in  this  opinion 
and  decision.  It  was  conceded  on  hearing 
that  judgment  was  rendered  in  the  county 
court  for  the  plaintiff  to  recover  .$102.04,  al- 
though this  fact  does  not  appear  from  the 
exceptions.  The  trial  in  the  county  court 
was  by  the  court,  who  filed  a  statement  of 
facts  signed  by  the  judges,  and  this  court 
is  confined  to  a  consideration  of  the  facts 
thus  found.  Laws  1888,  No.  5G,  §  1.  The 
county  court  foimd  that  the  first  nine  items 
of  plaintiff's  account,  with  interest  from  Oc- 
tober 13,  1888,  to  date  of  judgment,  amount- 
ed to  .$102.64,  the  amount  for  which  judg- 
ment below  was  rendered.  That  said  nine 
items  are  as  follows: 

1887. 

(1)  Dec.  27.  Michael  Burns  to  one  day 

at  Rutland $  2  00 

(2)  "      "    Car  fare  and  hotel 7r» 

1888. 

(3)  Feb.    7.       "       "        "  "    2  7.") 

(4)  June  5.       "      "        "  "    2  7."> 

(5)  "       8.   Cash   40  00 

(6)  Aug.  15.        "        10  00 

(7)  Oct.    1.        "      30  00 

(8)  "       "  One  day    2  00 

(9)  "       "  Hotel,  car  fare ' 1  40 

That  the  plaiutift"s  testate.  ^lichael  Burns, 
was  adjudged  to  be  an  insane  person,  Feb- 
ruary 7,  1888,  and  a  guardian  appointed 
over  him  February  11,  1888,  by  the  probate 
court  for  the  district  in  which  he  then  re- 
sided, and  that  the  guardian  duly  accepted 
the  appointment.  That  at  the  time  items 
Nos.  1,  2,  3,  4.  and  5  were  contracted  the 
plaintiff"  had  no  knowledge  that  Burns  had 
been  adjudged  insane  and  a  guardian  ap- 
pointed, but  he  had  such  knowledge  when 
items  Nos.  6  to  9,  inclusive,  accrued.  That 
during  the  time  covered  bj'  the  account 
Burns  was  a  feeble,  insane  old  man,  living 
in  his  own  house,  cared  for  by  Bridget  Man- 
ghan. That  both  Burns  and  Bridget  weri' 
not  on  friendly  terms  with  the  guardian, 
and  when  the  latter  applied  to  Bridget  to- 
learn  if  anything  was  needed  for  Burns  he 
was  told  that  Burns  was  not  in  Avant,  and 
did  not  at  the  time  know  of  the  loans  by 
the  claimant  to  Burns  until  the  latter's  deatli. 
That,  had  Bridget  made  known  to  the  guard- 
ian the  wants  or  needs  of  Burns,  they  would 


INSANE  PKRSijNS. 


CI 


liave  Won  sui»pru'(l  by  tlio  guardian.  That 
the  services  were  rendered  and  cash  paid  as 
charjred  in  the  account.  That  "the  money 
specified  in  itenis  Nos.  5.  (J,  and  7  was  used 
by  Bridj^et  Maughan  in  the  support  of,  and 
necessaries  for,  the  testate."  That  Burns 
died  July  14,  1889.  That  after  the  first  nine 
items  had  accrued  the  claimant  presented 
his  account  to  the  guardian,  and  he  prom- 
ised to  pay  the  items  of  a  date  prior  to  the 
appointment  of  the  guardian,  but  told  the 
plaintiff  he  would  not  pay  the  items  charged 
during  the  guardianship. 

As  the  plaintiff  did  not  except  to  the  dis- 
allowance of  items  Nos.  10  to  14,  inclusive, 
of  his  account  by  the  court  below,  it  is  un- 
necessary to  consider  them.  No  facts,  ex- 
cept as  above  stated,  were  found  bearing 
upon  the  question  whether  Burns  was  in 
need  of  necessaries,  or  in  regard  to  whether 
the  items  of  plaiutift"s  accoiuit  were  in  fact 
necessaries  for  Burns  at  the  time  they  ac- 
crued. 

An  insane  person,  whether  under  guard- 
ianship or  not,  may  be  bound  by  his  con- 
tract for  necessaries,  if  made  in  good  faith 
by  the  other  party,  and  under  circumstances 
which  justify  the  contract.  1  Pars.  Cont. 
387;  Chit.  Cont.  (10th  Am.  Ed.,  by  Perkins) 
1.10;  Seaver  v.  Phelps,  11  Pick.  304;  McCril- 
lis  v.  Bartlett.  8  N.  H.  .560;  Sawyer  v.  Luf- 
kin,  oG  Me.  308.  The  liability  of  an  insane 
person  and  of  an  infant  for  necessaries 
stand  on  the  same  footing,  and  are  govern- 
ed by  the  same  rules  of  law.  Mete.  Cont.  79; 
Thompson  v.  Leach.  3  Mod.  310;  2  Greenl. 
Ev.  §  300;  Seaver  v.  Phelps,  supra;  Lincoln 
V.  Buckmaster,  32  Vt.  6.52.  which  cites  with 
approval  Seaver  v.  Phelps,  supra;  Sawyer 
V.  Lufkin.  supra.  The  law  allowing  infants 
and  lunatics  to  bind  themselves  by  their 
contracts  for  necessaries  is  solely  for  their 
benefit,  and  intended  as  a  shield,  not  as  a 
sword,  to  their  hurt.  It  is  well  settled  that 
it  is  a  question  of  law  whether  the  articles 
furnished  to  an  infant  are  of  the  name  and 
qualitj'  coming  within  the  term  "necessa- 
ries."' and  a  question  for  the  jury  to  deter- 
mine to  what  extent  the  articles  of  that  de- 
nomination were  necessary  to  the  particular 
case.  In  Thrall  v.  Wright  38  Vt.  494,  which 
was  an  action  to  recover  for  alleged  neces- 
saries furnished  defendant,  a  minor,  it  was 
held  that,  although  the  articles  sued  for  are 
in  the  class  denominated  "necessaries,"  yet 
the  burden  of  proof  rests  on  the  plaintiff  to 
show  affirmatively  that  they  were  in  fact 
necessary  for  the  infant  when  furnished. 
Reeve,  Dom.  Rel.  *227.  *228;  Bainbridge  r. 
Pickering.  2  W.  Bl.  132.-.;  Ewell.  Lead.  Cas. 
62,  63.  In  .Johnson  v.  Lines.  6  Watts  &  S. 
80,  Avhicli  was  an  action  ro  rec-over  for  al- 
leged necessaries  furnished  defendant,  a 
minor,  and  under  guardianship,  the  court 
«ay:  "The  rule  of  law  is  that  no  one  may 
deal  with  a  minor.  The  exception  to  it  is 
'hat  a  stranger  may  supply  him  with  nec- 
essaries proper  for  him.  in  default  of  supply 


liy  any  one  else;  but  his  interference  with 
what  is  properly  the  guardian's  business 
nuist  rest  on  an  actual  necessity,  of  which 
he  mu.st  judge,  in  a  measure  at  his  peril." 
Kline  v.  L'Anidureux,  2  Paige,  419;  Pearl 
V.  McDowell,  3  J.  J.  Marsh.  6.".8.  Reason 
and  a  sound  public  policy  re<iuire  that  a 
plaintiff'  seeking  to  recover  for  alleged  neces- 
saries furnished  an  insane  person  should  l)o 
held  to  the  same  measure  and  rule  of  proof 
as  above  laid  down  in  the  case  of  an  infant, 
especially  where  the  insane  person  is  under 
guardianship.  To  hold  otherwise  would 
make  the  appointment  of  guardians  to  an 
insane  per.son  under  our  statute  practically 
of  no  effect,  and  turn  the  in.sane  ward  over 
to  the  care  of  any  person  who  might  inter- 
fere in  his  behalf,  without  regard  to  how  the 
guardian  looks  after  or  supplies  the  wants 
of  his  ward.  In  Lincoln  v.  Buckma.ster,  su- 
pra, the  lunatic  was  not  under  guardiausliip. 
In  that  case  the  court  said:  "Tliis  right  to 
supply  necessaries  to  lunatics  will  not  jus- 
tify any  one  in  crediting  them  with  what 
otherwise  might  be  necessaries,  so  long  as 
they  are  rightfully  under  the  care  and  con- 
trol of  family  friends,  on  the  ground  that 
they  are  not  properly  supported,  any  more 
than  one  can  so  interfere  in  the  mode  of 
clothing  and  educating  infants  while  under 
the  care  of  their  natural  or  legal  guardians. 
All  the  cases  hold  this."  This  reasoning  ap- 
plies with  far  greater  force  in  a  case  like 
the  one  at  bar.  where  the  lunatic  is  under 
guardianship,  and  where  the  guardian  is 
seeking  to  learn  the  wants  of  his  ward,  and 
is  ready  and  willing  to  supply  them.  The 
case  shows  no  occasion  for  the  interference 
of  a  stranger.  Burns  was  a  "feeble,  insane  old 
man"  during  the  entire  time  covered  by 
plaintiff's  account.  The  court  below  failed 
to  find  that  Burns  was  in  want,  or  that  any 
necessity  existed  which  made  any  of  the 
items  charged  ne<-essaries  at  the  time  they 
.accrued.  There  is  nothing  which  tends  to 
show  that  any  of  the  items  fall  within  the 
class  denominated  "necessaries."  or  that  any 
of  them,  excepting  Nos.  5,  6,  and  7,  were  in 
any  way,  dire<tly  or  indirectly,  beneficial  to 
Burns,  or  to  show  for  what  purpose  the 
plaintiff  expended  time  and  incurred  car 
fare  and  hotel  bills.  The  plaintiff  must  have 
known  Burns'  mental  condition.  He  had 
constructive  notice  of  the  appointment  of  a 
guardian  at  the  time  it  was  made,  and  ac- 
tual kuowliHlge  after  the  first  five  items  of 
his  account  accrued,  yet  he  took  no  meas- 
ures at  any  time  to  consult  with  the  guard- 
ian until  he  presented  his  account  to  him  for 
payment.  It  is  to  be  presumed  that  the 
county  court  found  and  reported  all  the 
facts  which  the  evidence  before  it  warrant- 
ed it  in  finding,  and  it  is  not  for  this  court, 
in  view  of  the  statute  requiring  the  finding 
of  facts  to  be  in  writing  and  signed  by  the 
judges,  to  assume  that  the  county  court 
found  facts  not  included  in  such  statement, 
which  is  like  and  takes  the  place  of  a  spe- 


C2 


INSANE  PERSONS. 


<-i;il  vcrdirt.  This  court  cauudt  liiul  or  infer 
facts.  Hence  I  insist  that  tlie  phiintiff  can- 
not recover  ou  the  ground  on  wlu<-li  the  ma- 
jority of  the  court  put  their  decision,  for 
the  reason  that  he  lias  failed  to  show  atRrni- 
atively  that  the  various  items  of  his  ac- 
count were  necessaries  of  wliich  Burns  stood 
iu  need  at  the  time  they  were  furnislied 
liim.  It  may  be  said  that  the  money  speci- 
fied in  items  Nos.  5,  0,  and  7  was  used  in 
tlie  support  of  and  necessaries  for  Burns, 
but  this  does  not  answer  the  objection  that 
tlie  plaintiff  has  failed  to  prove  that  Burns 
was  so  without  means  of  support  at  the 
time  the  money  was  furnished  as  to  make 
it  fall  within  the  meaning  of  the  term  '"nec- 
essaries" when  it  was  loaned  him.  If  the 
plaintiff  were  entitled  to  recover  for  the 
money  expended  by  Bridget  Manghan  for 
necessaries,  it  is  incumbent  upon  him  to 
show  the  amount  so  used,  and  this  he  has 
failed  to  do.  But  the  fact  that  some  of  the 
money  was  subsequently  expended  for  neces- 
saries cannot  avail  the  plaintiff.  Infants 
and  persons  non  compos  mentis  stand  on 
the  same  footing  as  to  their  liability  for  nec- 
essaries, and  also  as  to  what  constitute  nec- 
essaries, as  is  shown  by  the  authorities  al- 
ready cited.  It  is  well  settled  that  an  in- 
fant is  not  liable  iu  an  action  at  law  for 
money  supplied  him  to  purchase  necessaries, 
although  he  actually  used  the  money  for 
that  purpose.  The  reason  of  this  is  that  the 
contract  arises  upon  the  lending,  and  the 
law  Avill  not  support  contracts  which  are  to 
depend  for  their  validity  upon  a  subsequent 
contingency.  In  5  Bac.  Abr.  (Bouvier's  Ed.) 
"Inf."  119,  the  rule  is  stated  thus:  "So,  if 
one  lends  money  to  an  infant,  who  actually 
lays  it  out  in  necessaries,  yet  this  shall  not 
bind  the  infant,  nor  subject  him  to  an  ac- 
tion; for  it  is  upon  the  lending  that  the  con- 
tract must  arise,  and  after  that  time  there 
could  be  no  contract  raised  to  bind  the  in- 
fant, because  after  that  he  might  waste  the 
money,  and  the  infant's  applying  it  after- 
wards for  necessaries  will  not,  by  matter  ex 
post  facto,  entitle  the  plaintiff  to  an  action." 
Schouler,  Dom.  Rel.  ~>~>o;  Tyler.  Inf.  p.  114, 
§  70;  Chit.  Cont.  (10th  Am.  Ed.,  by  Perkins) 
163;  2  Kent,  Comm.  *2.3.o;  Ellis  v.  Ellis,  ,5 
Mod.  368;  Darby  v.  Boucher,  1  Salk.  279; 
Earle  v.  Peale,  Id.  387;  Swift  v.  Bennett.  10 
("ush.  430;  Bradley  v.  Pratt,  23  \t.  386. 
This  would  seem  to  dispose  of  any  claim  of 
the  plaintiff  to  recover  on  this  theory  for  the 
money  that  was  expended  by  Bridget. 

Is  the  plaintiff  entitled  on  any  ground  to 
recover  for  all  or  any  part  of  his  account? 
The  case  shows  that  the  probate  court  had 
jurisdiction  of  the  person  and  property  of 
Bums  at  the  time  it  adjudged  him  to  be  an  in- 
sane person,  and  that  this  adjudication  was 
made  on  due  notice  and  hearing.  The  first 
three  items  of  plaintiff's  account,  amounting 
to  .S-j.-jO.  accrued  prior  to  the  adjudication  and 
the  appointment  of  the  guardian.  As  they  ac- 
crued l)efore  the  adjudication  of   insanitv,   it 


was  incumbent  on  the  defendant  to  show  that 
the  mental  condition  of  Burns  at  the  time 
these  items  accrued  was  such  as  to  render 
him  incapable  of  contracting.  This  he  has 
not  done.  Indeed,  the  defendant's  counsel 
practically  admit  i)laintiff's  right  to  recover 
for  these  iiems.  .lackson  v.  King,  4  Cow. 
207.  l.">  -Vm.  Dec.  ;!.")4,  and  note. 

The  plaintiff  cannot  recover  for  the  remain- 
ing items,  as  they  all  accrued  subsecpient 
to  the  adjudication  of  insanity  and  the  ap- 
pointment of  guardian,  it  not  appearing  tliat 
they  were  necessaries.  After  inquisition  and 
adjudication  of  insanity,  and  the  appointment 
of  a  guardian  to  an  insane  person,  all  his  con- 
tracts, except  for  necessaries,  are  void,  while 
such  adjudication  and  appointment  remain  in 
force.  Beverley's  Case,  4  Coke,  126b,  127a;  5 
Bac.  Abr.  (Bouvier's  Ed.)  28;  15  Am.  Dec. 
368.  note  to  .lackson  v.  King;  Ewell,  Lead. 
Ca.s.  .j88;  Wait  v.  Maxwell,  5  Pick.  217;  Leoa 
ard  V.  Leonard,  14  Pick.  280;  Lynch  v.  Dodge, 
1.30  Mass.  4."8;  Pearl  v.  McDowell,  3  .J.  J. 
Marsh.  6."i8;  L'Amoiu'eux  v.  Crosby,  2  Paige, 
422,  22  Am.  Dec.  6.").''i,  and  note;  1  Greenl.  Ev. 
(12th  Ed.)  §  n.jO.  The  soundness  of  this  propo- 
sition is  especially  apparent  when  applied  to 
adjudications  under  the  probate  system  e.s- 
tabllshed  by  statute  in  this  and  many  other 
of  our  states.  It  should  be  kept  in  mind  that 
an  inquisition  of  lunacy  in  England,  and  in 
those  states  which  retain  the  English  system 
of  proceeding  in  such  a  case,  is  very  different 
from  the  proceedings  under  the  system  of  pro- 
bate courts  in  this  and  other  states.  By 
Rev.  Laws.  §§  2436,  2437,  provision  is  made- 
for  the  appointment  of  guardians  by  the  pro- 
bate court  to  insane  persons  and  spendthrifts. 
The  words  "insane  person"  include  everv 
idiot,  non  compos,  lunatic,  and  distracted  per- 
son; and  the  word  "spendthrift"  includes  ev- 
ery person  who  is  liable  to  be  put  under  guaid- 
ianship  on  account  of  excessive  drinking, 
gaming,  idleness,  or  debauchery.  Id.  SS  7. 
243.5.  A  spendthrift  may  be  put  under  guard- 
ianship whenever  he  so  spends,  wastes,  or 
lessens  his  estate  as  to  expose  himself  or  hi.** 
familj^  to  want  or  suffering,  or  the  town  to 
charge  for  supporting  himself  and  his  family. 
Id.  §  2437.  By  statute,  guardians  of  these 
several  classes  of  unfortunate  persons,  and  of 
minors,  have  practically  the  same  rights,  and 
are  subject  to  the  same  liabilities  and  duties. 
There  can  be  no  question  but  what  the  pur- 
pose of  the  statutes  providing  for  the  appoint- 
ment of  a  guardian  over  any  person  falling 
within  the  classis  named  is  "to  secure  propel- 
care  of  his  person  and  of  his  property,  and,  as 
to  his  property,  to  secure  it  from  being  wast- 
ed through  lack  of  care  or  squandered  by  im- 
provideut  contracts."  Kol)insou's  Ex'r  v.  Rob- 
inson, 39  Vt.  270.  To  render  this  benetlcent 
design  of  the  law  effectual,  it  would  seem 
that  there  can  be  no  doubt  but  what  the  leg- 
islature intended  all  contracts,  except  for 
necessaries,  to  be  void,  when  made  by  any 
person  falling  witliin  either  of  the  classes- 
named,  after  he  has  been  adjudged  an  insaiu^ 


INSANE  PERSONS. 


6H 


jicrsou  or  to  be  a  spoudllnift,  and  a  j^uard- 
iaii  appointed  over  him  by  the  probate  court, 
while  such  appointment  remains  in  force. 
This  intent  Is  clearly  shown  by  the  very  full 
lirovision  for  the  ternunatiou  (if  such  j^uard- 
ianship  at  the  instance  of  the  .uuardian  or 
the  ward,  provided  for  by  Kev.  Laws,  $§  '2r,i\2- 
L'.jIO,  inclusive.  If  this  was  not  the  purpose 
of  our  statute  on  this  sid)ject,  for  what  pur- 
pose was  it  enacted?  Motley  v.  Head.  43  Vt. 
(133.  is  cited  in  the  opiuiou  of  the  majority  of 
ihe  court  as  holdinij;  that  au  adjudit-atiou  of 
insanity  relied  upon  iu  defense,  to  be  avail- 
able, must  be  accompanied  with  evidence 
showinj;  that  the  insanity  is  of  that  character 
which  dis(iualities  the  defendant  from  making 
a  valid  contract,  and  it  does  in  effect  .so  hold. 
This  case  seems  to  be  anomalous.  There  is  a 
line  of  cases  in  England  and  in  America,  iu 
states  following  the  English  procedure  in 
making  in<iuisition  of  luuacy,  which  hold  that 
such  inquisition  and  office  found  is  only  pi-ima 
facie  evidence  of  the  incapacity  of  the  de- 
feuiiant  to  make  a  valid  contract.  Most  of 
these  cases  relate  to  contracts  entered  into  be- 
fore ottice  foiuid,  but  within  a  time  during 
which  the  inquisition  finds  the  person  to  have 
been  a  lunatic.  1  have  found  no  case  which 
did  not  hold  that  the  tinding  was  prima  fa- 
cie evidence  of  the  defendant's  lack  of  mental 
capacity  to  make  a  valid  contract.  None  of 
these  cases  arose  under  a  prol)ate  system  like 
oiu'  own.  In  Motley  v.  Head,  the  court  do  not 
even  give  the  adjudication  the  effect  of  prima 
facie  evidence;  otherwise  the  burden  of  prov- 
ing mental  capacity  would  be  cast  upon  the 
l)laintitf,  and  not  upon  the  defendant,  as  stat- 
ed in  that  case.  In  that  case  a  guardian  was 
appointed  over  the  defendant  by  a  court  in 
Massachusetts  while  he  was  temporarily 
there  for  treatment  iu  an  inebriate  asylum. 
At  the  time  of  the  adjndication  and  appoint- 
ment of  guardian  in  Massachusetts,  Head  was 
a  citizen  of  this  state  having  his  domicile  and 
home,  and  that  of  his  wife  and  family,  here, 
and  it  was  stated  in  the  application  for  the 
ap])ointment  of  a  guardian  that  he  was  a  res- 
ident of  Windsor,  in  this  state.  Motley 
sought  to  recover  for  services  and  money 
which  he  rendered  and  furnished  in  this  state 
iu  and  about  the  business  of  the  defendant, 
by  the  procurement  of  Head's  wife,  who  was 
his  agent  for  that  purpose,  during  the  lime  be 
was  in  Massachusetts.  The  case  does  not 
shoAv  that  Head  had  any  property  iu  Massa- 
chusetts, or  that  by  the  statutes  of  that  state 
the  probate  court  there  had  jurisdiction  to  ap- 
point a  guardian  in  such  a  case.  It  might 
well  be  questioned  whether,  on  the  facts  dis- 
closed, the  adjudication  of  that  probate  court 
would  have  any  effect  anywhere.  If  this  de- 
cision is  sound  law.  it  practically  prevents  or 
destroys  the  beueticial  results  intended  by 
such  an  appointment  over  persons  of  the 
classes  named.  Suppose  a  guardian  is  ap- 
pointed over  a  spendthrift,  wlw  is  adjudged  to 
be  such  by  reason  of  excessive  drinking,  and 
the  ward  falls  into  the  hands  of  some  knave, 


who  overreaches  him  liy  a  sharp  bargain,  and 
then  sues  him  tn  recover  damages  for  his  fail- 
ure to  fuhill  it.  liidtT  the  doctrine  laid  down 
in  Mdtlcy  v.  Hc.-ul,  in  order  to  have  the  ad- 
judication and  iippointment  of  a  guardian  af- 
ford him  any  protection,  the  ward  must  show 
attirniatively  that  at  tln'  time  of  the  alleged 
contract  his  mental  condition,  resulting  from 
excessive  drinking,  was  such  as  to  render  him 
legally  incompetent  to  enter  into  a  valid  con- 
tract. Leonard  v.  Leonard,  supra,  was  an  ac- 
tion to  recover  the  amount  of  a  i)roniissory 
note  dated  May  IL'.  l.S3(l,  made  by  defendant 
and  payabk'  to  plaintiff  or  order.  .lunc  1, 
1830,  the  plaintiff  was  regularly  put  under 
guardianship  by  the  probate  court  as  a  per- 
son non  compos  mentis,  in  May,  1831,  the 
defendant  paid  the  plaintiff  the  amount  of  the 
note,  and  took  it  up.  the  .^^ame  being  then  in 
the  possession  of  jjlaintiff.  The  defendant  of- 
fered to  prove  that  the  plaintiff  was  not  non 
compos  mentis,  but  that  he  was  before  and  at 
the  time  the  guardian  was  appointed,  and 
since  had  been,  of  sound  mind,  and  capable 
of  managing  his  own  concerns.  This  evi- 
dence was  rejected,  the  court  holding  that 
the  decree  of  the  coiut  of  probate  Avas  con- 
clusive, and  instructed  the  jury  that  under 
these  circtunstances  the  delivery  of  the  mon- 
ey to  the  ward  did  not  amount  to  a  pay- 
ment of  the  note.  A  verdict  was  found  for 
the  plaintiff,  and  judgment  was  attirmed  by 
the  supreme  court.  In  delivering  its  upin- 
ion.  the  court,  on  the  qtiestiou  that  the  ad- 
judication of  the  probate  court  is  conclusive, 
say:  "If  this  were  not  the  general  primiple 
of  the  law,  the  situation  of  the  guardian 
would  be  extremely  unpleasant,  and  it  would 
be  almost  impossible  to  execute  the  trust,  in 
every  action  he  might  be  obliged  to  go  be- 
fore the  jury  upon  the  question  of  sanity,  and 
one  jury  might  find  one  way,  and  another  an- 
other. We  are  of  the  opinion  that  as  to 
most  subjects  the  decri'e  of  the  probate  court, 
so  long  as  the  guardianship  continues,  is  con- 
clusive evidence  of  the  disal)ility  of  the  ward, 
but  that  it  is  not  conclusive  in  regard  to  all. 
For  example,  the  ward,  if  in  fact  of  sutticient 
capacity,  may  make  a  will,  for  this  is  an  ad 
which  the  guardian  cannot  do  for  him.  lint 
the  transaction  now  in  question  falls  within 
the  general  rule."  This  exception  iu  regard 
to  a  ward's  making  a  will  is  recognized  in 
Robinson's  Ex'r  v.  Robinson,  3U  Vt.  liTt*.  and 
is  there  put  upon  the  ground  that  "a  person 
of  a  lower  degree  of  mental  capacity  is  to  be 
rega'-ded  conipetent  to  make  a  testamentary 
disposition  of  his  property  than  is  reijuired 
to  deal  with  and  dispose  of  it  by  contracts." 
Blaisdell  v.  Holmes,  48  Vt.  4!t2,  is  also  cited 
in  the  majority  opinion.  That  was  an  action 
to  recover  for  services  rendered  by  plaintiff 
to  defendant  as  his  housekeeper.  The  defend- 
ant was  a  farmer,  an  unmarried  man.  owning 
a  farm  on  which  he  lived,  and  which  he  car- 
ried on  during  the  time  covered  by  plaintitl's 
service.  I'rior  to  plaintiff's  eiuployment  by 
him,  the  deft'Udant  had  been  adjudged  an  iu- 


64 


INSANE  PERSONS. 


sane  person,  and  a  jruaidian  appointed  over 
him  by  the  probate  court,  and  during  the  en- 
tire time  she  worlied  for  him  he  was  under 
such  fjuardian.ship.  Durinjj;  that  time  the  de- 
fendant managed  his  farm  and  propertj'  and 
household  affairs  in  his  own  way,  without  in- 
terference on  the  part  of  his  guardian.  The 
guardian  knew  tliat  plaintiff  was  at  work  for 
defendant,  and  told  her  to  stay  and  he  would 
see  her  paid.  The  plaintiff  kept  house  for  de- 
fendant, did  his  cooking,  and,  so  far  as  ap- 
pears, performed  the  usual  household  duties 
<?onnocted  with  housekeeping.  Her  term  of 
service  extended  one  year  from  November, 
1870.  The  guardian  died  June  11,  ISTy,  and 
prior  to  the  bringing  of  her  suit,  and  after  his 
death,  the  defendant  had  no  guardian.  It 
would  seem  from  the  facts  stated  that  the 
judgment  in  favor  of  the  plaintiff,  on  reason 
and  authorit}',  might  have  been,  and  should 
^have  been,  put  on  the  ground  that  plaintilf's 
services  were  necessaries  furnished  under 
such  circumstances  as  to  make  defendant  lia- 
ble therefor.  The  court  seem  to  have  decided 
the  case  on  the  ground  that  practically  there 
was  a  termination  of  the  guardianship.  In 
delivering  the  opinion  of  the  court,  Kedfleld, 
J.,  says:  "The  adjudication  of  the  probate 
court,  that  defendant  was  at  the  time  a  prop- 
er subject  of  guardianship,  is,  no  doubt,  con- 
clusive; and  that  condition  of  the  ward  is, 
ordinarily,  presumed  to  continue.  But  when 
it  altirmatively  appears  that  the  ward  has  re- 
covered from  his  infirmity,  and  is  in  the  pos- 
.session  of  a  sound  mind,  and  is  conducting 
business  in  his  own  right  and  name,  like  other 
citizens,  and  the  guardian  sees  him  buy  and 
sell,    hire  and  pay,   without  notice   or   inter- 


ference, we  see  no  good  reason  or  rule  of  law 
that  should  shield  him.  more  than  other  men. 
from  the  eo:um  n  liability  to  pay  his  hi  ed  l.eip. 
Judge  Redtield  says  (3  Redf.  Wills,  458):  'In 
eases  of  persons  of  unsound  mind,  the  guard- 
ianship will,  practically,  tenninate  with 
the  recovery  by  the  ward  of  his  sound  mind 
and  disposing  capacity.'  "  If  the  decision  in 
that  case  was  put  upon  tenable  groimd,  it  is 
far  from  being  an  authority  which  supports 
the  decision  arrived  at  by  the  majority  of  the 
court,  as  the  facts  in  that  case  bear  no  re- 
semblance to  those  in  the  case  at  bar.  In  3 
Redf.  Wills,  458,  and  immediately  following 
the  quotation  made  by  the  court  as  above,  it 
is  said:  "But  it  is  regarded,  in  practice,  as 
the  only  regular  course  for  the  court,  on  ap- 
plication by  any  party  interested,  and  notice 
to  all  others  in  interest,  to  declare  the  guard- 
ianship terminated  by  the  occasion  for  its 
continuance  having  ceased.  The  same  rules 
will  apply  to  cases  of  guardianship  over 
spendthrifts."  The.se  suggestions  are  pecul- 
iarly pertinent,  in  view  of  our  statute  above 
cited,  providing  for  the  termination  of  such 
guardianship.  I  am  aware  that  this  whole 
subject  is  attended  with  dilliculty,  and  that 
the  decisions  bearing  upon  it  are  somewhat 
conflicting;  but  in  view  of  the  beneficial  re- 
sults intended  by  the  law  providing  for  guard- 
ians over  this  class  of  persons,  and  having 
in  mind  its  ample  provisions  for  the  termina- 
tion of  such  guardianship,  I  think  that  this 
court  has  adopted  a  view  of  the  matter  in 
the  two  cases  cited  and  in  the  case  at  bar 
which  practically  nullifies  the  law.  1  would 
reverse  the  judgment,  and  render  judgment 
for  the  plaintiff  to  recover  !j;5..50  damages. 


INSANE  PERSONS. 


65 


In  ro  KENZ. 

(44  N   W.  r>!)S,  7J>  -Mich.  liI(J.) 
Snprcinc  Coui-t  of  Mi(lii;;aii.      .I;iii.   17.   IS'.K). 

Appeal  from  circuit  court,  Wnyue  coun- 
ty;  CoR.MCMCs  J.  Rkili.y,  .)u(lj;e. 

Jus.  J.  SjH'cd,  for  appellant.  John  (i. 
Hawley,  for  appellee. 

(iHAN'r,.!.  This  iHanai)i)eal  from  tiie  al- 
lowance to  Jacob  C.  Mann,  guardian  of  Em- 
ma Kenz,  an  incompetent,  of  the  sum  of 
.f4S.").41  forthecareand  maintenance  of  said 
incompetent  attheasylum  foi- tlieinsan(!at 
Kalamazoo.  The  stipulated  fact.sarethe.se, 
viz. :  Emma  l\cnz  wa.s  the  wife  of  Henry 
Ilenz.  and  had  been  for  .some  time  prior  to 
iNTf).  In  March,  1N7").  she  became  insane,  and 
her  friends  deemed  it  advisable  to  remove 
her  to  the  asylum.  She  had  no  guardian  at 
that  time,  noruntil  May,  1877.  Her  husband 
and  John  Baumeister  on  March  4,  1875, 
made  a  contract  with  said  a.syhim  to  pay 
certain  exti-a  charges  and  expenses  while 
at  the  asylum.  Her  husband  was  unable 
to  pay  such  expenses.  Mrs.  Baumeister, 
the  mother  of  Emma  by  a  formerhusband, 
asked  her  husband,  Mr.  Baumeister,  to  ad- 
vance the  money  necessary  to  send  and 
keep  Emma  in  the  asylum,  saying  to  him 
that  she  had  made  a  will  bequeathing  Em- 
ma ,|>1,()00,  and  that  he  could  be  reimbursed 
out  of  that  legacy.  Ba,umeister  expecting 
to  be  reimbursed,  paid  the  above  amount 
for  removing  and  keeping  her  at  the  asy- 
lum. Mrs.  Baumeister  died  May  24,  1876, 
leaving  a  will  containing  the  betiuest,  and 
making  her  husband  executor.  After  the  leg- 
acy became  payable,  Jacob  Mann  Avas  ap- 
pointed guardian,  and  tiled  his  account  as 
such  guardian  in  the  probate  coui't, charg- 
ing himself  with  .$1,000,  the  amount  of  the 
legacy,  and  crediting  himself  with  the 
above  amount,  which  Baumeister  had  ex- 
pended for  thecareof  Emmaattheasylum. 
The  circuit  court  held  that  this  amount 
was  properly  chargeable  by  Baumeister 
against  the  legacy,  and  that  it  was  proper 
and  lawful  for  said  Mann,  as  guardian,  to 
allow  the  same. 

That  the  removal  of  Mi-s.  Renz  to  the 
asylum  was  dictated  alike  by  necessity  and 
humanity;  that  Baumeister  and  Mann,  the 
guardian,  acted  in  good  faith  ;  that  the  ex- 
penditure of  the  money  was  judicious,  and 
for  her  benefit, — are  not  questioned.  But 
it  is  contended  on  the  part  of  the  appel- 
lants that  the  claim   of  Baumeister  is  ille- 

VAN  ZILE  SEL.CAS..S.\LES— 5 


gal,  Ix'cnuse  the  husband  was  primaiil\  lia- 
ble, and  Mrs.  Kejiz,  being  insane,  couhl 
neither  contract  nor  a.ssent  to  this  tran.s- 
action,  and  did  not.  I'.nt  lier  husband  was 
unable  to  pay.  and  slie  had  oid\-  an  ex- 
pectancy fi-om  her  mother.  If  aiijjellant's 
liositi(jn  be  c(jrrect,  then  an  insane  ma iTied 
woman,  wiiose  iiusband  is  unalde  to  i»ro- 
vide  for  her  pro])er  medical  treatnx'iit  for 
her  malady,  though  possessed  of  an  estate 
//J />/v/'.s7>//f/ or  exi)ectancy,  must  eithei-  iie- 
come  a  i>ul)lic  chai'ge,  or  be  left  without 
assistance.  In  f'arstens  v.  Hanselman,r>l 
Mich.  4;{(),2S  N.  W.  Itep.  1.7.),  the  court  says: 
"where  a  husband  utterly  deserts  his  wife, 
it  would  be  a  cruel  rule  for  her  if  she  can- 
not, in  his  absence  at  least,  or  in  his  jjres- 
ence,  if  he  does  not  himself  provide  for  her. 
make  a  binding  agreement  for  any  neces- 
sary, wliether  articles  to  l)e  jturchasecl  or 
professional  help,  without  becoming  a  pub- 
lic cliarge."  Still  more  cruel  would  be  a 
rule  that  the  fi-iends  of  an  insane  married 
woman  cannot  advance  money  to  procure 
for  her  medical  attendance  and  care  when 
the  husband  is  utterly  unable  to  do  so,  and 
in  so  doing  bind  her  estate.  Infants  and 
insane  i)ersons  are  liable  for  necessaries 
furnished  theni,  and  the  statute  of  this 
state  expressly  makes  the  estates  of  insane 
persons  liablefor  their  maintenance  at  the 
asylum.  Act  No.  l:3.j,  §  '.\1,  Laws  188.1. 
Alexander  v.  Miller,  10  Pa.  St.  211t. cited  by 
appellant,  is  not  in  point.  In  that  case 
the  wife  of  an  insane  man  attempted  to 
sell  his  property,  not  to  provide  medical 
care  or  necessaries,  but  to  prevent  the  levy 
of  an  execution  on  his  property.  Of  cour.se 
shehad  noauthority  to  do  this.  Thetpies- 
tion  presented  here  did  not  arise  in  that 
case.  The  husband  of  Mrs.  Kenz  being  un- 
able to  provide  for  her  removal  to  the  asy- 
lum, an  act  of  the  highest  necessitv.,  it 
would  have  been  competent  to  use  her  own 
property  for  that  purpose,  if  she  had  been 
l^ossessed  of  any.  Baumeister  advanced 
the  money,  not  as  a  gift,  but  expecting 
eventually  to  be  reimbursed.  A  guardian 
was  subsequently  ai)p()inted,  and  received 
a  thousand  dollars,  the  i)roperty  of  .Mrs. 
Kenz.  If  a  guardian  had  been  appointed 
l)efore  she  was  sent  to  tlie  asylum,  and 
he  had  sent  her  there,  and  i)aid  for  it.  would 
it  be  contended  that  he  hail  no  right  to  be 
reimbursed  out  of  her  estate?  I'nder  the 
circumstances,  we  hold  that  the  claim  was 
an  equitable  one,  and  was  proi)erly  al- 
lowed by  the  probatecourt.  Thejudgment 
must  be  affirmed,  with  costs.  Theothei'jus- 
tices  concurred. 


06 


INSANE  PERSONS. 


ALEXANDER  v.  IIASKINS  et  al. 
(27,  N.  W.  9ar>.  68  Iowa,  73.) 
Suiin-nie  Court  of  Iowa.      Dec.  17,  18S.J. 
Apijcal  from  district  cuiul.  Harrison  coun- 
t.v. 

Action  to  set  aside  a  conveyance  of  real  es- 
tate made  by  the  plaintiff,  on  the  ground 
tliat  he  was  insane.  The  relief  asked  was 
denied,  and  the  plaintitf  appeals. 

.1.  II.  Smitli  and  A.  W.  Clyde,  for  appellant. 
II.  II.  Koadifer  and  S.  II.  Cochran,  for  appel- 
lees. 

SEI:\"1:KS.  .J.  The  general  rule  is  thai  an 
insane  person  is  not  bound  bj-  (;ontracts  (\'an 
I'atton  V.  Reals,  4(j  Iowa,  (52),  and  it  has  been 
held  tliat  it  is  immaterial  wliether  the  de- 
fendant had  knowledfie  of  such  insanity 
when  the  contract  was  entered  into  (Seaver 
V.  rhelps.  11  Pick.  ;;5()4).  While  the  foresoiuji' 
may  be  rej^arded  as  the  general  rule  where 
;in  application  is  made  to  set  aside  the  con- 
tract by  some  one  acting  for  the  insane  per- 
son, thei'e  are  exceptions  thereto  when  the 
<()ntract  has  been  executed;  and  in  this  state 
the  ml"  is  that  an  insane  person  is  bound  by 
such  contract  "where  it  is  made  in  the  ordi- 
nary coiuse  of  business,  is  fair  and  reason- 
al>le.  and  the  mental  condition  was  not 
known  to  the  other  party,  and  the  parties 
<annot  be  put  in  statu  quo."  Behi'ens  v.  Me- 
Kenzie,  2.'>  Iowa.  oHo;  Ashcraft  v.  De  Ar- 
mond,  44  Iowa,  234;  Abbott  v.  Creal.  .jG 
Iowa.  17t).  9  N.  W.  11.""). 

We  have  carefully  examined  the  evidence, 
and  unite  in  the  conclusion  that  the  plaintiff 
AA  as  insane  at  the  time  the  contract  and  con- 
veyance in  (piestion  were  made.  But  counsel 
for  the  appellees  insist  that  the  conveyance 
cannot  be  set  aside  because  it  was  made  in 
the  xisual  course  of  bvisiness,  and  is  in  all  re- 
spects fair  and  reasonable,  and  therefore  the 
case  is  brought  within  the  rule  established 
in  the  foregoing  cases.  From  a  careful  con- 
sideration of  the  evidence,  we  reach  the  con- 
elusion  that  in  this  counsel  are  mistaken. 
It  is  averred  in  the  petition  that  the  defend- 
ants had  knowledge  of  the  mental  condition 
of  the  plaintiff  at  the  time  the  contract  and 


convey.-ince  were  made,  and  we  are  satislied 
that  this  has  been  established  by  the  evi- 
dence. We  deem  it  unnecessary,  and  such 
Is  not  our  custom,  to  set  out  the  evidence  and 
state  our  reasons  at  length. 

There  is  therefore  a  material  distinction 
between  the  cases  above  cited  and  this.  Our 
attention  has  not  been  called  to  any  case 
which  holds  that  a  contract  made  with  an 
Insane  person,  witli  knowledge  of  the  insani- 
ty, has  been  sustained,  and  we  think  none 
such  can  be  found.  Besides  this,  we  are  not 
satisfied  tl'.at  the  contract  and  conveyance  in 
question  is  fair  and  reasonable.  The  evi- 
dence shows  that  the  laud  was  worth,  at  the 
time  the  conveyance  was  made,  from  ."t^tJbO 
to  .$800.  We  will  assume  that  it  was  worth 
at  least  .$(;00.  The  defendant  paid  the  plain- 
tiff ])ossibly  .^j^O.").  and  there  is  evidence  tend- 
ing to  show  that  the  defendant  claimed  the 
plaintiff  was  indebted  to  him  on  an  account, 
including  the  .$!».")  above  stated,  in  the  amount 
of  al)0ut  .$200,  but  the  correctness  of  this  ac- 
count has  not  been  established.  It  therefore 
must  be  disregarded.  There  was  a  mortgage 
on  the  land  executed  by  the  plaintiff  for  .$300, 
and  it  will  be  conceded  that,  as  between 
these  i)arties,  the  defendant  agreed  to  pay  it. 
but  the  plaintiff  was  not  released  from  per- 
sonal liability  the..'eoii.  Thei'e  is  no  evidence 
tending  to  show  that  this  moi'tgage  has  been 
paid.  If  it  be  conceded  that  the  indebted- 
ness due  by  the  plaintiff  to  the  defendant 
was  regarded  as  satisfied  by  the  conveyance, 
and  that  its  correctness  has  been  established 
by  the  evidence,  it  only  amounts  to  .$214.90, 
or  about  one-third  of  the  value  of  the  real 
estate.  The  defendants  have  had  possession 
of  the  land,  and  have  received  the  rents  and 
profits  thereof,  for  four  years;  and  the  evi- 
dence shows  that  the  rental  value  thereof 
has  been  at  least  $G0  per  year,  or  say  $2.")0 
for  the  Avhole  period.  It  therefore  clearly 
appears  that  the  defendants  have  received, 
in  rents  and  profits,  more  than  the.v  paid  the 
plaintiff  for  the  lands.  We  are  of  opinion 
that  the  court  erred  in  refusing  to  set  aside 
the  conveyance,  and  there  will  be  a  decree 
entered  in  this  court,  if  counsel  so  desire. 
IJeversed. 


INSANK  I'KKHONS. 


67 


BLACKSTONE     v.     STANDARD     LIFE     & 
ACC.   INS.  CO.i 

(42  N.  W.  150,  74  Mich.  592.) 

Snprome  Court  of  Michigan.      April   24.  ISSO. 

Error  to  circuit  court,  Lenawee  county; 
Lane,  Judge. 

Action  by  Emma  W.  Bhickstone  against 
the  Standard  Life  &  Accident  Insurance 
Company.  Judgment  was  given  for  [)lain- 
tiff,  and  defendant  brings  error. 

James  7\  Keena,[  C.  E.  Weaver  and  At- 
kinson, Carpenter  &  Brooke,  of  counsel,) 
for  appellant.  Westerinan  ct  Westernian, 
■{ISet/i  7/.  Bean  and  Leoi  T.  Griffin,  of  coun- 
sel,) for  respondent. 

LONG,  J.  Plaintiff  brought  her  action 
upon  a  policy  of  insurance,  the  material 
parts  relating  to  this  case  reading  as  follows: 

"In  consideration  of  the  representations 
made  in  tlie  application  for  this  insurance 
and  tlie  sum  of  twenty-five  dollars,  tliis  com- 
pany hereby  insures  Daniel  L.  Blackstone, 
Esq.,  residing  at  Adrian,  countyof  Lenawee, 
-and  state  of  .Michigan,  hereinafter  styled  the 
insured,  by  occupation,  profession,  or  em- 
ployment a  traveling  salesman,  in  the  prin- 
cipal sum  of  five  thousand  dollai's  for  the 
term  of  twelve  months,  commencing  at  12 
•o'clock  noon  on  the  27th  day  of  February, 
181S*',  the  said  sum  to  be  paid  to  ALs.  Etnma 
W.  Ijlackstone,  his  wife,  if  surviving,  within 
thirty  days  after  tiie  receipt  of  satisfactory 
proots  that  the  said  insured  shall  have  sus- 
tained during  the  <  ontiuuance  of  tiiis  policy 
bodily  injuries,  effei'ted  through  external, 
Tiolent,  and  accidental  means,  within  the  in- 
tent and  meaning  of  this  contract  and  the 
conditions  hereto  annexed,  and  such  injuries 
alone  shall  have  occasioned  death  within 
ninety  days  from  the  happening  thereof: 
*  *  *  provided,  always,  that  this  policy 
is  issued  and  accepted  subject  to  all  tiie  pro- 
visions and  conditions  herein  contained  and 
referred  to.  The  statements  and  declarations 
of  the  insured,  in  his  application  for  this  in- 
surance, together  with  the  company's  classi- 
fication of  iiazard,  is  referred  to  and  made  a 
part  of  tliis  contract;  and  if  this  policy,  or 
an}'  renewal  tiieieof,  has  been  made  or 
sliall  be  obtained  through  misrepr^'sentations, 
fraud,  or  concealment,  or  if  any  attempt  shall 
l)e  ma<le  by  false  swearing  or  suppression  of 
any  material  fact  on  the  part  of  tlie  insurt'd 
or  beneticiary,  to  obtain  any  sum  under  tliis 
policy  or  any  renewal  thereof,  then  the  same 
shall  be  absolutely  void:  provided,  always, 
that  this  insurance  shall  not  extend  to  hernia; 
nor  to  any  bodily  injury  of  which  there  shall 
be  no  external  or  visible  sign;  nor  to  any 
bodily  injury  happening  directly  or  indir>'Ctly 
in  consequence  of  bodily  infirmities  or  dis- 
ease, or  by  poison  in  any  manner  or  form,  or 
by  any  surgical  operation  or  medical  or  me- 
chanical treatment;  nor  to  any  case  except 

1  Opinion  of  Campbell,  J.,  omitted. 


where  the  injury  is  tiie  proximate  and  sole 
ca.ise  of  the  disability  or  (h-ath.  And  no 
claim  sliall  be  made  under  this  policy  v\  lien 
the  tk'atli  or  injury  has  been  caused  by  duel- 
ing, lighting,  wrestling,  unnecessary  lifting, 
or  by  overexertion,  or  by  suicide,  or  by  sun- 
stroke, freezing,  or  iutentioiial  injuri"S  in- 
dicted by  or  though  the  connivance  of  the 
insured,  or  when  the  death  or  injury  may 
liave  happened  in  ronsH(|U('nce  of  war.  *  *  * 
And  this  insurance  shall  not  be  iudd  to  ex- 
tend to  disappearances,  nor  to  any  cause  of 
death  or  disability,  unless  the  claimant  under 
this  [)olicy  shall  establish  by  direct  and  posi- 
tive proof  tiiat  the  said  death  or  disability 
was  caused  by  external,  violent,  and  acci- 
dental means." 

This  policy  was  made  subject  to  certain 
conditions,  the  second  of  which  is:  "The  in- 
sured is  required  to  use  due  diligence  for  per- 
sonal safety  and  protection.  In  the  event  of 
any  accidental  injury  for  which  claim  may 
be  made  under  this  polic}',  immediate  notice 
shall  be  given  in  writing,  addressed  to  the 
company  at  Detroit,  JNIichigan,  stating  the 
full  name,  occupation,  and  address  of  the  in- 
sured, with  full  particulars  of  the  accident 
and  injury;  and  failure  to  give  such  imme- 
diate notice  shall  invalidate  all  claims  inuler 
this  policy,  and  unless  diiect  and  atlirmative 
proof  of  the  death  of  the  insured  shall  be  fur- 
nished to  the  ■■omi)any  within  ninety  days 
from  the  happening  of  such  fatal  accident, 
or  within  six  months  in  the  case  of  non-Ialal 
injury,  then  all  claims  accruing  under  this 
policy  shall  be  waived,  and  forfeited  to  the 
company."  The  policy  was  issued  upon  ji 
written  application  signed  by  tlie  insured. 
The  twellth,  thirteenth,  and  fourteentli 
clauses  of  the  application  are  as  follows: 
"(12)  My  habits  of  life  are  correct  and 
temperate,  and  I  understnnd  the  policy  will 
not  cover  any  acciilent  or  injury  resulting 
from  the  use  of  intoxicating  drinks,  or  in 
consequence  of  having  been  under  the  inllu- 
ence  thereof,  or  a  breach  of  the  law,  or  to 
any  injury  which  may  result  from  disease  or 
prior  injury.  1  am  aware  and  agree  that  the 
benefits  from  the  company  wiil  not  extend 
to  hernia,  orchites,  overexertion,  or  strains, 
nor  to  any  bodily  injury  which  has  not  been 
effected  tiirough  external  and  accidental  vio- 
lence, or  of  which  there  shall  be  no  ext  rnal 
and  visible  signs,  or  by  poison  in  any  form 
or  manner,  or  by  any  surgical  o;eration  or 
medieal  or  mechanical  treatment,  nor  to  any 
cause  except  where  the  accidental  injury  sliall 
be  the  proximate  and  sole  cause  of  the  disa- 
bility or  deatii.  (13)  I  am  not  suffering 
from  any  accident  or  wounds  that  would  re- 
tard recovery,  or  be  aggravated  by  personal 
injury.  I  am  not  subject  to  fits,  or  to  any 
disorders  of  the  brain  or  nervous  system,  or 
any  physical  infirmity  which  would  render 
me  liable  to  accident.  (14)  1  iiereby  agree 
that  tiie  application  and  declaration  shall  be 
the  basis  of  the  contract;  that  the  jiolicy  will 
be  accepted  subject  to  all  the  conditions  and 
provisions  contained  therein;  that  any  con- 


G8 


INSANE  PERSONS. 


ccalment  of  material  facts,  or  misstatenieiits 
made  by  me,  shall  work  a  forfeiture  of  all 
claims  tiiat  may  accrue  under  this  policy." 

The  declaration  liled  in  the  case,  after  stat- 
ing the  issuing  and  the  conditions  of  the  pol- 
icy, avers  "tiiat  on  the  28lh  day  of  October, 
a'.  D.  188G,  her  said  husband  died  from  bod- 
ily injuries,  effected  througii  external,  vio- 
lent, and  accidental  means,  within  the  intent 
and  uieaniniT  of  said  pol.cy  contract,  and  the 
conditions  therein  set  forth;  and  that  said 
injuries  alone  occasioned  hisdeath,  and  with- 
in ninety  chiys  from  the  happening  of  said  in- 
juries." The  defendant  pleaded  tlie  general 
issue,  and  gave  notice  that  tiie  policy  declared 
upon  was  obt;nned  by  the  insured  upon  an 
application, — the  material  portions  of  which 
have  been  heretofore  set  out, — and  under  an 
agreement  that  said  application  should  be 
tl)e  basis  of  the  contract.  That,  at  tiie  time 
wiien  said  application  was  made,  the  iiisureei 
was  subject  to  disorders  of  the  brain  and 
nervous  system,  and  to  physical  inlirmities 
which  rendered  him  liable  to  accident;  and 
the  fact  that  he  was  so  subject  was  concealed 
by  him  from  the  defendant.  That  the  in- 
sured died  from  injuries  resulting  from  dis- 
ease. That  the  insured,  before  the  time  he 
made  3aid  application,  had  been  for  a  long 
period  insane,  and  at  tlie  time  of  making 
said  ai'plication  concealed  that  fact  from  the 
defendant.  On  the  trial  in  the  court  lielovv 
the  plaintiff  had  verdict  and  judgment  for 
the  amount  of  the  policy  and  interest.  De- 
fendant brings  error. 

It  appeare.i  upon  the  trial  in  the  court  be- 
low tliat  the  insured,  Daniel  L.  JJlackstone, 
was  a  traveling  salesman,  and  was  empk)yed 
in  tliat  capacity  during  the  sj^ring  and  sum- 
mer of  188G  by  tlie  Acme  Hay  Harvester 
Company,  of  Peoria,  111.  About  September 
1,  1886,  he  was  thrown  out  of  employment, 
and  returned  to  his  home  in  Adrian,  and  re- 
mained there  until  October  18th,  when  by 
correspondfnce  he  secured  a  situation  with 
Mast,  Buford  &  Burwell  JManufacturing 
Company,  of  St.  Paul,  Minn.  He  left  his 
home  in  Adrian  October  18th,  for  the  pur- 
pose of  tilling  this  engagement,  and  arrived  in 
iSt.  Paul  on  the  19th,  and  remaineil  there 
until  the  27ti)  of  that  mouth,  when  he  put 
an  end  to  his  life  by  cutting  his  throat  with 
a  razor.  It  is  claimed  by  plaintiff  that  during 
the  last  two  or  three  weeks  of  l)is  remaining 
at  home  he  showed  evidence  of  mental  de- 
rangement, and  that  during  his  stay  in  St. 
Paul,  from  October  19th  to  the  27th,  there 
was  evidence  of  insanity.  The  plaintiff's 
claim  of  recovery  on  the  policy  rests  upon 
two  ])ropos.tions,  each  of  which  is  denied  by 
tlie  defendant :  (1)  That  iJlackstone  wms  in- 
saJie  at  the  time  lie  took  his  life:  (2)  tliat  an 
insane  self-killing  is  an  accident  within  the 
meaning  of  tliis  policy.  Was  iilackslone  in- 
sane at  the  lime  he  took  his  life?  At  the 
close  of  the  testimony  the  counsel  submitted 
five  special  questions  to  the  jury  for  their 
finding,  as  follows:  (1)  Did  Mr.  Blackstone 
kill   himself?  (2)  Did  he  know  at  the  tiiiiO 


that  he  was  committing  an  act  whicli  must 
result  in  death?  (3)  Was  he  conscious  of 
what  he  was  doing?  (4)  Did  he  intend  to  cut 
his  throat,  and  thereby  kill  himself?  (5)  At 
the  time  Daniel  L.  Blackstone  cut  his  throat, 
was  he  insane?  The  jury  answered  these 
questions,  the  first  and  fiftii  in  tiie  affirm- 
ative, and  the  second,  third,  and  fourth  in  the 
negative.  We,  have,  therefore,  presented  to 
us  by  tlie  record  of  the  fifth  finding  of  the 
jury  that  the  insured  was  insane  at  the  time 
he  cut  his  throat,  and  tiie  only  inquiry  for 
us  upon  this  part  of  the  case  is.  Was  there 
any  evidence  to  support  this  tinding? 

It  was  said  by  tliis  court  in  Conely  v.  Mc- 
Donald, 40  Mich.  158:  "We  are  bound  in  all 
cases  to  assume  that  the  jury  have  done  no 
legal  wrong  when  acting  within  their  prov- 
ince. *  *  *  The  credibility  of  witnesses, 
the  strength  of  their  testimony,  its  tendency, 
and  the  proper  weigiit  to  be  given  it,  are  mat- 
ters pculiarly  within  their  province.  *  *  * 
To  take  from  them  this  riylit  is  but  usurping 
a  1)0 wer  not  given."  This  doctrine  has  al- 
ways been  adhered  to  in  this  stale,  and  has 
been  stated  and  restated  in  so  many  cases  in 
this  court  that  no  reference  to  them  is  neces- 
sary. The  testimony  relating  to  the  insanity 
of  Mr.  Blackstone  is  somewhat  voluminous, 
and  we  shall  quote  only  portions  of  it. 

Mr.  Wallace  Westerman  was  called  as  a 
witness  by  the  plaintiff,  and  testilied  sub- 
stantially that  lie  had  known  Mr.  Blackstone 
between  12  and  13  years;  that  he  was  a  man  of 
more  than  ordinary  intelligence, — a  man  well 
read,  courteous,  and  of  more  than  ordinarily 
pleasant  and  genial  disposition.  His  business 
for  lU  years  prior  to  liis  death  was  that  of  a 
traveling  salesman  engaged  with  different 
houses.  For  four  or  five  years  he  was  witli 
Comstock  Bros.,  of  Adrian;  then  for  Pair- 
banks,  Morse  <fc  Co.,  up  to  April,  1886;  and 
then  for  the  Acme  Hay  Harvester  Company 
of  Peoria,  up  to  September  1, 1886.  when  he  re- 
turned liome.  His  family  relations  were  of 
the  most  pleasant  character.  He  had  a  wife, 
and  a  family  consisting  of  two  girls  and  one 
boy.  That  from  the  time  of  his  return  home 
— the  1st  of  Seiitember — till  his  going  away  on 
October  18,  188ti,  witness  was  in  his  house 
everyday.  At  the  first  of  his  b:'ing  home  at 
this  time  he  saw  no  special  difference  in  his 
coniuct,  but  after  lie  had  been  home  two  or 
tliiee  weeks  he  discovered  a  marked  change  in 
his  conduct.  These  characteristics  came  on 
by  degrees.  He  appeared  to  be  depressed;  and 
the  nearer  the  time  came  for  him  to  1  ave 
home  this  despondent,  indifferent  sort  of  dis- 
position seemed  to  grow  upon  him.  He  com- 
plained that  he  did  not  sleep  well,  and  put 
his  hand  up  to  his  head;  frequently  found 
him  walking  the  Door,  and  sometimes  sitting 
in  a  chair  in  a  sort  of  stupid  condition,  pay- 
ing no  special  attention  to  those  around  him; 
complained  of  [)n\u  in  the  head,  and  his  face 
had  a  bloated  appearance.  He  fell  away  in 
flesh,  and  appeared  to  be  haggard,  and,  as 
these  spells  wouM  pass  off,  would  look  pale 
and  sickly.     The  witness,  upon  a  direct  qius- 


INSANE  PERSONS. 


69 


tion,  said:  "I  was  (3f  the  opinion  lie  was  in- 
sane. I  did  not  obj(ict  to  liis  ^(ung  away,  be- 
cause I  did  not  think  tlie  man's  mind  was  so 
far  gone  but  that  when  he  got  away  from 
home  he  would  recover  from  it;  that  if  he 
could  get  away  from  home  he  would  brace  up 
and  recover  from  it.  The  deceased  was  my 
latlier-iii-law." 

Mrs.  W'esterman,  the  wife  of  the  last  wit- 
ness, and  a  daughter  of  the  deceased,  testified 
that  her  father's  domestic  relations  were 
jjleasant.  That  she  saw  him  every  day  for 
tlie  three  weeks  before  his  going  to  St.  Paul, 
iind  noticed  a  marked  change  in  his  condi- 
tion, lie  complained  of  his  head  and  stom- 
ach, lie  did  not  take  much  notice  of  his 
grandchildren,  when  before  that  he  always 
joved  to  Iiave  them  around  him;  but  at  that 
lime  their  noise  seemed  to  worry  him.  He 
would  not  go  (jut  at  all,  and  did  not  seem  to 
want  to  see  any  one. 

Mr.  Henry  Armstrong,  a  resident  of 
Adrian,  saw  the  deceased  frequently,  and  no- 
ticed a  change  in  him  just  before  his  going 
away,  as  he  passed  him  on  the  street.  Tlie 
change  was  so  great  that  he  hardly  recog- 
nized him. 

Walter  Westerman  testified  that  he  had 
known  him  for  years;  that  he  was  always  in 
the  iiabit  of  shaking  hands  with  every  one, 
and  made  many  friends;  was  pleasant,  so- 
cial, and  agreeable  in  his  manners;  a  man 
who  was  very  bright,  of  more  tlian  ordinary 
•education,  and  always  ready  to  make  a  speech 
wlierever  called  upon.  Witness  is  a  partner 
with,  the  witness  Walhice  Westerman,  in  the 
law  business,  and  deceased  was  freijuentiy  in 
their  olRce,  but  for  the  three  weeks  before 
•deceased's  going  away  in  October  he  but  sel- 
dom came  to  the  office.  Just  prior  to  his  go- 
ing away  to  St.  Paul  he  came  into  the  office, 
and  came  up  within  a  few  feet  of  Wester- 
man, who  got  up  and  offered  to  shake  haiuls, 
but  Blackstone  apiiarently  did  not  see  him 
make  the  offer,  and  did  not  shake  hands,  but 
s!ood  with  his  head  down,  and  tinahy  said, 
"Where  is  AVallace?  Tell  him  I  want  that 
l<ey;"  and,  turning  around,  went  partly  to 
the  door,  turned  again  into  the  room  a  few 
feet,  and  finally  went,  slamming  the  door 
after  him. 

The  plaintiff  says  that  before  his  goin^' 
away  on  October  18lh  she  noticed  a  ciiange 
in  his  mental  con<lition.  He  was  uneasy 
and  nervous,  complained  of  his  liead,  and 
liad  a  desire  to  be  alone.  He  appeared  bad, 
his  face  was  fluslied  and  bloated,  he  ditl  not 
sleep  mucii,  manifested  restlessness  by  walk- 
ing in  the  house  and  out  in  the  back  yard. 
Went  down  town  but  little.  "We  could  di- 
vert his  mind  so  that  he  would  be  social  for 
afew  minutes,  but  just  as  soon  as  we  stop[)ed 
talking  with  him  his  mind  was  absorbed  in 
sormtliing.  We  did  not  know  what  he  was 
thinking  about.  He  was  affected  in  his 
mind.  We  let  him  go  away  because  we 
thought  with  employment,  and  being  out  of 
doors,  he  would  be  better." 

Depositions  were  taken  at  St.  Paul  and  rear: 


on  the  trial.  J.  Summers  testified  he  kept 
the  Windsor  Hotel,  and  that  Bhu  kstone 
stopped  there  from  October  2iHh  to  tlie  28th; 
tliat  on  that  day  one  if  the  S'-rvants  informed 
him  that  a  man  up  stairs  had  cut  his  throat. 
He  went  up  stairs,  found  IMackstoiui  in  his 
room,  lying  on  the  floor,  between  the  wash- 
staiui  and  the  foot  of  the  bed,  in  a  crouciied- 
up  position.  He  was  quite  rigid.  His  throat 
was  cut  from  ear  to  ear,  ap[)arently  by  the 
razor  that  was  lying,  where  he  had  fallen, 
covered  with  blood,  across  the  room.  On  a 
little  bureau  lay  an  open  satchel  aiui  the  razor 
case.  He  had  apparently  been  dead  several 
hours.  On  the  day  previous  to  his  death  he 
was  in  the  office  the  most  of  the  forenoon. 
Never  saw  him  in  conversation  witJi  others 
abont  tiie  hotel. 

Mr.  J.  H.  Baker,  of  St.  Paul,  testified 
that  his  business  was  that  of  keeping  a  res- 
tan  i;int.  He  met  lllackstone  a  few  days  {)re- 
vions  to  his  death.  He  was  in  very  poor 
health,  and  said  he  was  under  treatment  from 
Dr.  McCoy  for  stomach  trouble.  He  looked 
pale  and  haggard,  restless,  and  in  a  very  un- 
pleasant state  of  mind.  He  would  sit  down 
for  a  miiuite,  and  tiien  would  get  up  and 
walk  around,  and  talk  about  his  troui)le,  his 
ill  health,  and  he  appeared  to  be  slightly  con- 
fusf»d. 

J.  P.  Warner  testified  tliat  he  was  connect- 
ed with  Mast,  Buford  &  Burweil,  of  St.  l^iul. 
"On  October  20,  1S8G,  he  was  employed  by 
our  firm.  He  was  to  prepare  himself  a  few 
days  before  starting  out  on  the  road, — was  to 
start  out  Wednesday  morning  the  week  after 
he  came,  and  liad  his  satchel  all  packed,  and 
left  the  office  about  5  o'clock  Tuesdiy  after- 
noon. He  was  to  take  the  8  o'clock  train 
Wednesday  morning.  His  valise  was  left  at 
our  office,  and  I  was  in  doubt  what  had  be- 
come of  the  man.  On  Thursday  afternoon  I 
learned  he  had  killed  himself.  Qtiestion. 
Now,  during  the  time  you  saw  him,  did  you 
in  your  conversation  with  him  detect  in  it 
any  peculiarities  of  mental  (oiidilion  as  evi- 
dence of  what  lie  said  ordid?  Answer.  Yes. 
The  second  morning  he  was  with  us  he  came 
in  in  a  hurried  and  peculiar  manner,  and 
rushed  up  to  the  counter  to  me,  inquiring  for 
niMil  in  a  very  impatient  manner,  so  much 
so  that  I  was  about  to  say  something  to  him, 
and  looked  at  him  pretty  sharp.  The  duties 
he  was  required  to  p  rfurm  on  the  road  re- 
quired some  study  and  posting.  He  would 
be  getting  information  about  one  particular 
thing,  and  would  turn  off  another  minute, 
and  be  in  some  other  place  in  the  otlice  look- 
ing at  some  book,  and  a  few  minutes  af t<  r- 
wards  would  be  out  of  doors,  and  at  one  time 
he  went  off  on  the  railroad  track  when  Mr. 
Burweil  was  not  down,  standing  around  at 
the  Manitoba  depot.  He  did  not  pay  close 
attention  to  his  duties.  He  acted  strange  in 
that  he  would  not  take  time  to  listen  as  a 
person  ought.  He  would  shoot  off  when  bi> 
ing  talked  to.  He  acted  as  if  he  wasn't  lis- 
tening, and  had  that  indifferent  way."  Wit- 
uess  then  says:    "I  am  satisfied  from  his  pe- 


70 


INSANE  TERSONS. 


culi:ir  actions  that  I  saw,  and  his  subsequent    j 
actions,  tliiit  he  wasn't  in  his  liglit  mind;    , 
and  outside  of  tiie  fact  that  he  coniiuitted 
suicide  1  wouhl  say  1  would  consider  liim  un- 
balanced in  his  mind." 

Mr.  J.  M.  Bigford  testified  tiiat  he  was  a 
salesman  for  Mast,  lUiford  &  lUuwell  at  St.  i 
Paul;  tiiat  he  met  Mr.  IJIackstone  lirst  in 
Octolier,  at  their  cilice.  It  was  Ids  duty  to 
post  him  on  prices  of  goods  of  which  he  was 
to  make  sales.  He  spent  a  part  of  each  day 
■witli  him.  One  day,  while  showing  him  anew 
model  plow,  it  was  almost  impossible  to  get 
him  interested  in  it.  He  asked  no  questions, 
and  did  not  give  the  least  indiration  that  lie 
understood  it.  He  seemed  to  be  in  a  deep 
study,  and  liis  mind  wandering  off  from  the 
subject  being  talked  al'out.  He  asked  to  be 
excused;  said  he  wanted  to  go  up-stairs;  did 
not  go,  but  went  into  the  otlice,  and  took  off 
Ills  overcoat,  and  paid  no  more  attention  to 
the  business.  "I  remarked."  said  the  wit- 
ness, "to  .Mr.  Warner  tliat  1  didn't  think  he 
was  right.  1  was  of  the  opinion  tliat  he  was 
not  in  his  right  mind.  What  I  told  him 
seemeil  to  make  no  impression  on  his  mind. 
I  would  go  over  tlie  same  ground  au'ain,  and 
still  he  appeared  as  ignorant  as  he  did  before. 
I  believed  him  to  be  a  man  of  unsound  mind." 

Mr.  H.  A.  Estes  was  clerk  of  the  Windsor 
Hotel,  and  noticed  that  the  deceasptrilid  not 
take  liis  meals  regularly,  appealed  to  be  de- 
spondent, made  no  acquaintances  about  the 
house.     He  complained  of  not  feeling  well. 

Dr.  .James  A.  Quinn  testified  that  he  was 
a  ])hysician  at  St.  Paul,  and  saw  the  deceased 
aft'^r  his  death;  made  an  examination;  and 
says  that  the  wouml  in  the  throat  was  the 
cause  of  death,  and  was  one  which  could 
have  been  made  by  the  deceased  with  his  own 
hand. 

This  is  substantially  all  the  testimony  bear- 
ing on  the  question  of  the  insanity  of  the  in- 
sured, exce[)t  some  circumstances  related  by 
Mr.  Wallace  Westerman  and  Waiter  Wes- 
terman  relative  to  some  peculiarities  in  the 
conduct  and  beaiingof  tlie  insured  just  prior 
to  his  going  to  St.  Paul.  Mr.  Blackstone 
wrote  home  to  his  wife  from  St.  Paul  on  the 
19th,  and  again  on  the  20tli  and  2:3d,  and 
in  his  last  letter  acknowledge!  receipt  of 
letters  from  home.  These  letters  are  con- 
cise, speaking  of  his  business  arrangemi-nts, 
and  making  inquiry  about  the  iioaltii  of  tlie 
family.  In  the  letter  of  the  20th  he  speaks 
of  the  pain  in  his  head  and  stomach,  and 
says  he  thinks  it  was  the  jar  of  the  cars,  and 
hi'pes  it  will  not  affect  him  so  badly  when 
hf  comes  to  travel  a}:;ain.  In  this  letter  he 
also  speaks  of  seeing  in  the  papers  an  ac- 
count of  a  number  of  persons  in  Adrian  be- 
ing poisoned  by  drinking  cider  in  which  ar- 
senic was  put,  and  inquired  of  his  wife  who 
tliey  were.  In  the  letter  of  the  2od  he  says: 
"I -am  tired  out.  I  am  very  sorry  to  pain 
you  by  writing  this,  but  you  asked  me  to  tell 
you  how  I  feel.  It  seems  to  me  if  I  could 
liave  some  work  out  of  doors,  like  riding. 
and  sometiiing  to  employ  my  mmd,  I  might 


gain.  I  shall  do  the  very  best  in  that  direc- 
tion. Pray  for  me,  and  clo  not  blame  me  for 
what  may  seem  inconsistent  to  you."  We 
think  there  was  some  evidence  to  go  to  the 
jury  upon  the  cpiestion  of  insanity.  It  is 
not  of  great  weight,  but  that  is  not  a  ques- 
tion which  we  are  at  liberty  to  discuss;  and 
while  we  might  have  found  differently  from 
the  jury  if  we  were  to  consider  it  as  a  ques- 
tion of  fact  for  our  determination,  yet,  there 
being  some  evidence  of  the  fact,  and  the  jury 
having  determined  it  under  what  we  think 
a  fair  submission  of  it  by  the  court  to  them, 
we  are  not  called  upon  to  disturb  it. 

The  insured  was  a  man  55  years  of  age,  of 
genial  and  pleasant  disposition,  full  of  lile 
and  vigor  up  to  witiiin  a  few  weeks  of  his 
death;  a  man  of  good  education,  and  good 
mind;  talkative,  and  apparently  happy.  His 
domestic  relations  were  pleasant,  and,  so  far 
as  this  lecord  discloses,  no  great  amount  of 
care  was  placed  upon  him  in  their  snp[)ort 
and  maintenance.  One  of  the  daughters 
was  married  to  a  man  apparently  prosperous 
in  business,  and  the  insured  had  no  debts  of 
any  amount,  and  no  creditors  pressing  him 
for  payment.  Up  to  within  a  month  or  six 
weeks  of  his  going  to  St.  Paul  he  had  been 
constantly  employed  at  good  wages,  and  no 
one  dependent  upon  him  was  suffering  dur- 
ing that  time  from  his  enforced  idleness.  He 
became  moody,  restless,  and  nervous  before 
leaving  home.  He  could  not  sleep  nii^hts, 
walked  the  floor,  and  was  found  at  times  pac- 
ing the  back  yard.  His  condition  became 
noticeable  to  his  wife  and  the  family.  He 
was  abstracted,  and  at  times  failed  to  re- 
spond to  the  salutations  of  his  acquaintances. 
His  mind  seemed  to  be  troubled;  complained 
of  pain  in  the  head,  and  looked  haggard  and 
sick.  On  his  arrival  at  St.  Paul,  where  he 
was  among  strangers,  his  ap])earance  caused 
remarks.  Me  could  not  get  to  the  business 
he  went  to  take  charge  of, — could  not  keep 
his  mind  ui)on  it;  was  nervous  and  restless, 
wanleriDg  from  place  to  place,  and  change- 
ful in  Ids  conduct;  nervous,  and  keeping 
alot)f  from  ((tlier  men  by  whom  he  was  sur- 
rounded; coniplainedof  pain  in  his  head  and 
stomach;  writing  home  to  his  wife  to  piay 
for  him,  and  not  to  blame  him  if  he  dd  any- 
thing inconsistent;  and  finally,  on  the  27tli 
of  the  month,  is  found  with  liis  throat  cut 
from  ear  to  ear  by  a  razor, — the  act  being 
committed  by  his  own  hand. 

Every  person  is  presumed  sane,  and  the 
burden  is  upon  the  plaintiff  in  the  case 
to  show  the  insure  1  insane  at  the  time  of 
tlie  taking  of  his  life.  The  jury  must  de- 
termine this  questiiin  from  the  acts  and 
conduct  Oi  the  de  eased,  and  this  can  only  be 
gathered  from  witnesses  who  are  cogni/ant 
of  the  facts.  The  learned  counsel  for  the  de- 
fendant, however,  argues  that,  even  if  there 
was  evidence  to  go  to  the  jury  on  the  ques- 
tion of  insanity,  and  thou^di  the  jury  iiave 
found  that  tlie  insured  came  to  his  death 
while  insane,  yet,  it  appearing  that  he  came 
to  his  death  by  his  own  hand,  it  is  not  a  bod- 


INSANE  TERSONS. 


71 


ily  injury,  effected  thio  ijrli  external,  violent, 
and  acL-idental  means,  witliin  the  meaning  of 
tiie  policy.  Practically,  all  the  cases  agree  in 
holding  in  tiie  language  of  the  siipreMie  court 
of  Massachusetts  in  Cooper  v.  Insurance  Co., 
102  Mass.  227,  that  there  is  no  substantial  dif- 
ference of  signilication  between  the  piirases, 
"sliall  die  by  his  own  hand,"  "shall  commit 
suicide,"  and  "shall  die  by  suicide."  Tiie 
rule  of  construction,  though  not  always  rec- 
oijnized  by  the  cases,  is  that  this  condition, 
b^ing  in  the  nature  of  a  penalty  or  forfeiture, 
must  be  strictly  ccmstrued.  In  Insurance 
Co.  V.  Mooie,  34  Mich.  41,  Mr.  JusticeCAMP- 
I4KLL,  speaking  for  the  court,  said:  "Tlie 
condition  which  makes  the  policy  void  in  case 
of  sucli  a  death  is  in  the  nature  of  a  p  nalty 
or  forfeiture.  *  *  *  The  forftiture  in 
tliis  case  was  to  arise  if  the  insured  died  by 
his  own  hand.  .Some  stress  is  laid  on  the 
term  'suicide,'  as  if  it  means  a  wrongful  act, 
or  self-murder.  It  has  no  such  restricted 
meaning.  It  means  self-killing,  just  as 
'  homicide  "  means  killing  any  one  else.  IJut 
there  may  be  excusable  homicide  as  well  as 
felonious;  andsuicide  was  only  cognizable  at 
law  wiien  the  person  was/e/o  de  ne,  or  guilty 
of  a  felonious  act.  If  nun  compos  me)itis, 
tlie  actor  in  homicide  or  suicide  commits  no 
criu'ie.  In  one  sense  the  man  dies  by  his  own 
liands  who  kills  hiuiself,  whether  sound  or 
frenzied.  But  the  condition  in  this  policy 
cannot  be  construed  to  caise  a  forfeiture  for 
acts  involving  no  evil  will." 

Upon  tiie  question  of  voluntary  suicide,  in- 
tentionally committed  by  a  sane  man  in  tiie 
possession  of  his  facultes,  knowing  how  to 
adopt  means  to  ends,  and  conscious  of  the  im- 
morality of  the  act,  there  is  no  ditiereiice  of 
opinion;  and  all  auti'.orities  agree  that  self- 
destruction  is  within  the  exempt. on;  and 
all  authorities  likewise  agree  that  an  acci- 
dental death. — as  by  taking  poison  by  mis- 
take, or  shooting  one's  self  with  a  pistol,  sup- 
posing it  not  to  be  loaded,  or  falling  from  a 
building,  or  death  happening  in  any  way  by 
tiie  unintended  act  of  the  party  dying, — is 
not  within  the  exemption.  But  whether  sui- 
cide by  an  insane  man  is  also  within  the  ex- 
emption has  bt-en  tiie  question  in  dispute, 
and  upon  this  two  prominent  and  diffi^rent 
doctrines  have  been  maintained.  On  tiie  one 
liand  it  is  maintained  that  if  the  act  lie  vol- 
untarih'  done  in  pursuance  of  an  intelligent 
Ijurpose,  and  intentionally  and  intelligently 
cariieil  out  by  the  proper  ado|)lion  of  uieans 
to  ends,  it  is  suicide  on  liie  part  of  the  in- 
sured, or  death  by  his  own  hands,  although 
insanity  exists  to  such  an  extent  th;it  he  may 
not  be  able  to  api)reciate  the  moral  (juallties 
of  the  act.  On  the  other  hand  it  is  main- 
tained that,  however  intelligently  the  act 
may  be  done,  if  at  the  time  the  will  be  over- 
powered by  an  uncontrollable  impulse,  or  the 
l)arty  be  unable  to  appreciate  the  moral  char- 
acter of  the  avt,  it  is  not  witliin  the  m  aning 
of  the  provision.  May,  Ins.  §  307.  The  rule 
in  Enyiand  was  laid  down  lu  1843,  in  Bor- 


radaile  v.  Hunter,  b  Man.  &  (i.  (539,  and  lias 
since  been  adhered  to.  In  tliis  case  the  words 
of  the  condition  were  that  the  policy  should 
be  void  if  the  assured  shoiihl  "die  by  iiis  own 
hand."  He  threw  himself  from  \'auxhall 
bridge  into  tJie  Tiiames,  and  was  drowned. 
The  jury  found  that  he  voluntarily  tlirew 
liimself  into  the  river,  knowing  at  the  tini" 
that  lie  should  thereby  destroy  Ids  life,  and 
intending  thereby  to  do  so;  but  at  the  time 
of  committing  the  act  he  was  not  capable  t)f 
judging  between  rlglit  and  wrong.  It  was 
held  that  the  policy  was  void,  the  rule  being 
laid  down,  in  effect,  that  the  moral  comlition 
of  the  mind  was  immaterial;  and  if,  when 
the  act  was  done,  the  insured  knew  that  life 
would  be  thereby  destroyed,  and  inteniled  it 
to  be  so,  the  policy  is  violated  uniier  the  c<mi- 
ditiou.  although  the  insured  was  insane  at 
the  time.  In  Dean  v.  Insurance  Co.,  4  Al- 
len, 9b,  the  supreme  court  of  Mas'^achusetts 
held  substantially  the  doctrine  as  laid  down 
in  Boiradaile  '.  ilunter,  supra.  In  Insur- 
ance Co.  V.  Gravv^s,  6  Bush,  2»j8,  the  supreme 
court  of  Kentucky  were  divided  upon  the 
question  of  the  soundness  of  Borra  iaile  v, 
Ilunter,  but  unanimously  agreed  that  where 
the  suicide  was  committed  during  an  uncon- 
trollable passion,  caused  by  intoxication,  the 
condition  was  broken,  and  the  policy  avoided. 
In  a  more  recent  case  in  Massachus^'tts 
(Cooper  V.  Insurance  Co.,  102  Mass.  227)  the 
question  came  again  before  the  court,  and 
the  ruling  in  Dean  v.  Insurance  Co.,  supra, 
was  adhered  to.  The  jnoviso  in  the  policy 
is  that  it  shall  bevoi<l  if  the  assured  shall  die 
by  suicide.  The  plaintiff  offered  to  prove 
that  the  assured  at  the  time  of  committing 
the  act  of  self-destruction  was  insane.  The 
court  said:  "In  the  present  case  there  was 
no  oflfei  to  prove  madness  of  delirium,  or 
that  the  act  of  self-destruction  was  not  tlie 
result  of  the  will  and  intention  of  the  party 
adapting  the  means  to  the  end,  and  contem- 
plating the  pliysical  nature  and  effects  of  the 
act." 

The  earliest  case  in  New  York  is  that  of 
Breasted  v.  Trust  Co.,  reported  in  4  Hill,  73. 
The  policy  was  to  become  void  if  the  assured 
died  by  his  own  hand.  The  insured  came  to 
liis  death  by  suicide  by  drowning  himself  in 
the  Hudson  river.  Chief  Justice  Nklson, 
delivering  the  opinion  of  the  court,  said, 
speaking  legally:  "Self-destruction  by  a  fel- 
low-being bereft  of  reason  can  with  no  more 
propriety  be  ascribed  to  the  act  of  his  own 
hand,  than  to  the  deadly  instrument  that  may 
have  been  used  for  the  purpose.  The  drown- 
ing of  Comfort  was  no  more  his  act,  in  the 
sense  of  the  law,  tlian  if  he  had  been  impelled 
by  irresistible  physical  power;  nor  is  there 
any  greater  reason  for  exempting  the  com- 
pany from  the  risk  assumed  in  the  policy  than 
if  his  death  had  been  occasioned  by  such 
means.  Suicide  involves  th-'  deliberate  ter- 
mination of  one's  existence  while  in  the  pos- 
session and  enjoyment  of  his  mental  facul- 
ties.    Self-slaughter  by  an  insane  man  or  a 


l.NSAM':   I'KKSOXS. 


Iiin;itic  is  not  ;in  act  of  suicide,  witliiii  the 
meaning  of  tiie  law;"  and  citinfj  4  lil.  fJoinin. 
189;  1  Hale,  V.  C.  411,  412.  Tiiis  case  was 
modified,  if  not  overruled,  in  Van  Zandt  v. 
Insurance  Co.,  .'iO  X.  Y.  169,  wlieic  it  was 
lield  that,  under  a  condition  as  above,  the 
only  exception  to  the  condition  is  where  the 
act  is  accidental  or  involuntary;  th;it  to  take 
a  case  out  of  the  proviso  the  insureil  must 
have  been  so  mentally  disordered  as  not  to 
understand  that  tlie  act  he  committed  would 
cause  his  death,  or  he  must  have  committed 
it  under  the  inlluence  of  some  insane  iu)- 
j)ulse,  whicli  he  could  not  resist.  It  is  not 
sullicient  tliat  his  mind  was  so  impaired  that 
he  was  not  conscious  of  tlie  moral  obliquity 
of  the  act.  In  the  later  cases  in  New  Yoik 
it  is  held  that  the  words  "die  by  liis  own 
liand"  have  reference  to  an  intellij^ent  volun- 
tary act,  and  not  to  a  suicide  committed  by  a 
party  in  a  state  of  mental  derang^■ment  so 
great  that  (he  act  of  self-destruction  is  to  l)e 
re<jarded  as  wholly  involuntary.  DefJogorza 
V.  Insurance  Co.,  GO  N.  Y.  2oo;  Weed  v.  In- 
surance Co.,  70  N.  Y.  561:  Newton  v.  Insur- 
ance Co.,  76  N.  Y.  426.  The  supreme  court 
of  Maine,  in  Eastabrook  v.  Insurance  Co.,  i'A 
Me.  224,  wliere  the  condition  of  the  policy  was 
that,  if  he  should  "die  by  his  own  hand,"  and 
the  jury  found  "tiiat  the  self-destruction  was 
the  result  of  a  blind  and  irresistible  impulse 
over  which  tlie  will  had  no  control,"  and  that 
"the  self-destruction  was  not  an  act  of  voli- 
tion," approved  l.reasted  v.  Trust  Co.,  supra, 
holding  thiit  suiciile,  to  avoid  a  policy  of  lite 
insuraTice,  must  be- a  criminal  act, — one  done 
with  an  evil  motive. 

The  leading  case  upon  the  subject  is  that 
of  Insurance  Co.  v.  Terry,  15  Wall.  580, 
aj)proving  wiiat  had  been  known  as  the 
"New  York  doctrine."  In  this  case  the  pol- 
icy was  to  be  void  it  the  insured  should  die 
by  his  own  hand.  Mr.  Justice  Hint,  alter 
a  full  review  of  the  cases,  laid  down  the 
rule,  thus:  "If  tlie  assured,  being  in  the 
possession  of  his  ordinary  reasoning  facul- 
ties, from  anger,  pride,  jealousy,  or  a  desire 
to  escape  from  tlie  ills  of  life,  intentionally 
takes  his  own  life,  the  {)roviso  atlaclies.  and 
there  can  be  no  recovery.  If  the  death  is 
caused  by  the  voluntary  act  of  the  assured, 
he  knowing  and  intending  that  his  death 
shall  be  the  result  of  his  act,  but  when  his 
reasoning  faculties  are  so  far  impaired  that 
he  is  not  able  to  understand  the  moral  char- 
acter, the  general  nature,  consequences,  and 
ell-  ct  of  the  act  he  is  about  to  commit,  or 
when  he  is  impelled  theielo  by  an  insane 
impulse,  which  he  has  mjt  the  power  to  re- 
sist, such  death  is  not  within  the  contempla- 
tion of  the  parties  to  the  contract  and  the  in- 
surer is  liable."  This  rule  has  been  a[iproved 
by  subsequent  cases  in  tlnit  court.  Insur- 
ance Co.  V.  Rodel,  95  U.  S.  2o7;  Insurance 
Co.  V.  Urougliton,  109  V.  S.  128,  3  Sup.  Ct. 
liep.  99;  citing  and  approving  the  opinion  of 
Chief  Justice  Nki.son  in  Hreasted  v.  Trust 
Co.,  supra.     The  rule  laid  down  in   Insur- 


ance Co.  v.  Terry,  15  Wall.  580,  is  substan- 
tially the  same  doctrine  as  stated  by  this 
court  in  Insurance  Co.  v.  Moore,  supra. 
We  think  the  reasonable  rule  is  as  stated  by 
Mr.  Justice  Hunt  in  Insurance  ('o.  v.  Terry, 
supra.  "If  the  assured,  Ixnng  in  the  posses- 
sion of  his  ordinary  reasoning  faculties,  from 
anger,  pride,  jealousy,  or  a  desire  to  escape 
from  the  ills  ot  life,  intentionally  takes  his 
own  life,  the  proviso  attaches,  and  there  can 
be  no  recovery.  If  the  death  is  caused  by 
the  voluntary  act  of  the  assured,  he  knowing 
and  intending  that  his  death  shall  be  the  re- 
sult of  this  act,  but  when  his  reasoning  fac- 
ulties are  so  far  impaired  that  he  is  not  able 
to  understand  the  moral  character,  the  gen- 
eral nature,  consequences,  and  effect  of  the 
act  he  is  about  to  commit,  or  when  he  is  im- 
pelled thereto  by  an  insane  impulse,  which 
lie  has  not  the  power  to  resist,  such  death  is 
not  within  the  contemplation  of  the  parties 
to  the  contract,  and  the  insurer  is  liable." 
This  d(jctrine  is  approved  and  followed  in  ex- 
press terms,  or  in  substance,  in  Insurance 
Ct).  v.  Hodel,  95  U.  S.  2:)2;  Insurance  Co.  v. 
liioughlon,  109  U.  S.  121,  3  Sup.  Ct.  99; 
Waters  v.  Insurance  Co.,  2  Fed.  liep.  892; 
Moore  v.  Insurance  Co.,  3  Ins.  Law  J.,  444, 
(LJ.  S.  C.  C.  K.  D.  Michigan;)  Merritt  v.^ln- 
surance  Co.,  55  Ga.  103;  Phillips  v.  Insur- 
ance Co..  26  La.  Ann.  404;  Insurance  Co.  v. 
Moore,  34  Mich.  41;  Scheffer  v.  Insurance 
Co.  25  Minn.  534;  Insurance  Co.  v.  Groom, 
86  Pa.  St.  92;  Ilathaway's  Adm'r  v.  Insur- 
ance Co.,  48  Vt.  335.  The  same  doctrine,  in 
substance,  is  laid  down  in  Eastabrook  v.  In- 
surance Co.,  54  Me.  224,  approving  the  prin- 
cipal cases. 

The  effect  of  this  doctrine  is  that,  in  order 
to  work  a  forfeiture  under  such  a  policy  on 
the  ground  of  self-destruction,  the  assured 
must  have  had  sullicient  menial  ca{)acity  not 
only  to  understand  that  the  act  will  destroy 
his  life,  but  also  distinguish  its  moral  quality 
and  consequences, — the  right  and  wrong  of  it: 
and  must  perform  the  act,  not  under  any  un- 
controlled impulse  I'esulting  from  insanity, 
but  voluntarily,  with  the  intent  to  end  his 
life.  In  other  words,  that  it  must  be  an  act 
lione  with  an  evil  motive.  We  think  that 
this  doctrine  is  supported  by  the  great  pre- 
ponderance of  authority  in  tliis  country,  and 
must  be  conceded  to  be  the  prevailing  Ameri- 
can doctrine;  and  it  seems  to  us  to  be  the 
safer  and  more  reasonable  and  rnore  consist- 
ent doctrine.  It  agrees  with  the  general  rule 
as  to  the  excusatory  feature  of  insanity  in 
civil  as  well  as  in  criminal  cases.  It  also 
operates  to  prevent  forfeiture,  which  is  a  fa- 
vorite princi|)le  of  an  enlightened  jurispru- 
dence. Nor  can  it  liave  any  injurious  effect, 
since  insurers  may  always  frame  such  con- 
tracts to  suit  themselves,  and  may,  if  they 
choose,  insert  express  stipulation  to  the  effect 
that  insanity  shall  not  in  any  case  prevent  an 
avoidance  by  the  suuide  of  the  assured.  As 
is  stated  in  a  note  to  IJreasted  v.  Trust  Co., 
59  Amer.  iJec.  494:    "If  they  prefer,  for  the 


INSANK   I'KKSOXS. 


73 


pill  pose  of  getting  custom,  to  omit  such  stij)- 
ulations,  aiiil  to  leave  the  mutter  in  clouiit, 
tile  iluubt  ouglit  to  be  resolved  Jigaiiist  tliem. 
It'  tlie  assured  is  to  take  the  sole  risk  ot  liis 
becouiing  insane,  and  liestioyiiig  his  lite,  let 
him  have  notice  of  the  fact  by  liaving  it 
clearly  '  nominated  in  the  bond.'  As  lias 
been  well  said  in  some  of  the  cases  referreil 
to,  insanity  is  as  mucii  a  disease  as  fever  or 
(onsumption;  and  upon  principle  there  is  no 
more  reason  why  an  insurance  of  one's  life 
should  not  be  an  insurance  against  death 
from  ihe  former  disease  tiian  against  death 
from  the  latter,  if  there  is  nothing  lo  the  con- 
tiaryin  the  policy."  I'olicies  issued  by  some 
life  insurance  companies  contain  a  condition 
or  proviso  that  it  shall  be  void  if  the  assured 
shall  die  by  suicide,  felonious  or  otherwise, 
sane  or  insane;  others  provide,  if  the  assured 
shall  die  by  suicide,  sane  or  insaiu^;  others 
provide  for  an  avoidance,  if  the  assured  die 
by  his  own  hand,  sane  or  insane;  while  others 
provide  for  aii  avoidance  if  he  shall  die  by  his 
own  act  and  intention,  sane  or  insane.  Such 
a  condition,  expresseil  in  any  of  these  forms, 
covers  any  case  of  voluntary  self-destruction, 
and  no  kind  or  tiegree  of  insanity  will  prevent 
an  avoidance;  and  the  courts,  not  only  in 
Knglaiui,  but  in  this  country,  have  almost 
universally  held  that  with  such  [)rovisions  in 
|M)licies  of  life  insurance  the  policies  are  void 
if  the  insured  comes  to  his  death  by  his  own 
hand.  Some  oi  those  cases  are  cited  by  the 
learned  counsel  for  the  deleudant  in  his  brief 
4is  having  some  bearing  upon  the  (jucstion 
now  in  issue.  We  think  they  have  no  bear- 
ing upon  the  case  where  no  such  proviso  is 
found  in  the  jjolicy. 

Defendant's  counsel  seem  to  rely  to  some 
extent  upon  the  ruling  of  this  court  in  Street- 
er  V.  Society,  reported  in  31  X.  W.  Hep. 
779,  as  bearing  upon  the  question  whether 
the  insured  came  to  his  death  in  this  case  by 
accidental  injuiies.  The  })(>licy  in  that  case 
contained  a  condition,  if  the  assured  shall 
within  three  years  from  the  date  ot  this  pol- 
icy die  by  his  own  hand,  sane  or  insane,  this 
policy  shall  become  and  be  null  and  void. 
AVithin  the  three  years  from  the  date  of  th 
policy  the  insureil  died  from  the  effects  of  ; 
pistol-sliot  wound  inllicted  upon  himsell. 
The  court  followed  the  opinion  of  Mr.  Jus- 
tice Davis  in  Uigelow  v.  Insurance  Co.,  98 
U.  S.  284,  holding  that  no  recovery  couhl  be 
had  upon  the  policy,  by  reason  of  the  limita- 
tion contained  in  the  proviso,  "sane  or  in- 
sane." After  quoting  from  the  opinion  of 
Mr.  Justice  Da\is,  it  was  said  :  "  If  a  person 
does  an  act  in  a  state  of  uncoiis  iousness,  or 
involuntarily,  whether  he  be  sane  or  insane, 
such  act  is  nothing  nu^re  nor  less  than  acci- 
dental, and  would  not  operate  to  forfeit  the 
policy.  The  record  in  this  case  does  not  dis- 
close such  a  state  of  facts.  There  was  no 
evidence  that  the  act  was  involuntary,  or 
that  Mower  was  unconscit)us  when  he  in- 
flicted upon  himself  the  fatal  wound.  The 
policy  covers  all  conscio.us  at-ts  of  the  insured 
by  which  death  by  his  own  hand  is  compassed, 


whether  he  was  at  the  time  sane  or  insane. 
If  the  act  was  done  for  the  purpose  of  self- 
destruction,  it  matters  not  that  tlie  insured 
liad  no  conceplion  of  the  wrong  involved  in 
its  commits. on." 

Counsel  for  the  defeiidint  now  insists  that 
if  the  insured  was  insane  his  insanity  caused 
his  death,  and  that  insanity  is  a  disease,  and 
that  theqiieslion  rema.n.n.',  and  upon  wjiich 
the  court  must  pass,  is,  is  tliede;dh  caused  by 
the  disease  "insanity"  an  accidental  death? 
The  policy  provides  "that  the  insurance  shall 
not  extend  to  any  boilily  injury  of  which  there 
shall  be  no  external  or  visible  sign,  nor  to 
any  bodily  injury  happening  ilircctly  or  indi- 
rectly in  conse(iuence  of  bodily  intirmities  or 
disease,  nor  tt»  any  one  except  when  the  in- 
jury is  the  proximate  and  soleiause  of  the 
disability  or  death."  Is  insanity  a  disease? 
The  learned  Dr.  Ibickham,  in  his  woik  on  In- 
sanity in  its  Meilico-Legal  Helations,  pnli- 
lisheil  in  1S8;?,  at  section  215,  says:  "We 
think  sutlicient  evidence  has  already  been 
educed  to  show  that  insanity  is  a  physical, 
and  not  a  mental,  disease.  And  yet  the  proof 
par  ex'-'dlenre  remains  to  be  olTered.  We 
have  taken  ciuisiderable  tnuible  to  ac(|uaiiit 
ourselves  with  the  facts,  and  we  beiieve  that 
there  is  no  ahenist  in  the  United  States  who 
believes  that  insanity  is  a  disease  of  the 
mind."  And  the  learned  doctt)r  oilers  the 
following  as  a  delinition  of  insanity  "A 
diseased  or  ciisordereil  condition  or  malfor- 
mation of  the  physical  organs,  tlirouiih  which 
the  mind  receives  impn  ssions,  or  manifests 
its  ojieiations,  by  which  the  will  and  judg- 
ment are  impaired,  and  the  conduct  ren- 
dered irrational."  And  lie  says:  "As  a  cor- 
ollary we  otter:  Insanity  being  the  result  of 
physical  disease,  it  is  a  matter  ot  fact  to 
be  determined  l)y  medical  experts,  and  not  a 
matter  of  law  to  be  deciiled  by  legal  decisions 
and  maxims."  Agreeing,  as  wedo.  willi  liie 
learned  doctor,  tiiat  insanity  is  a  physical 
disease,  and  a  (luestion  of  fact  for  determina- 
tion in  thecas'.',  let  us  see  what  has  been  de- 
termined liy  the  jury,  before  considering  the 
Iirojiosition  made  liy  the  counsel  for  the  de- 
fendant. 

The  jury  found — First,  that  the  insured 
killed  himself;  sccaiK/,  that  he  did  not  know 
at  the  time  that  he  was  committing  an  act 
which  must  result  in  death;  tliinl,  that  he 
was  not  consciv)Us  of  what  he  was  doing; 
fourth,  that  he  did  not  intend  to  cut  his 
throat,  and  therel)y  kill  himself;  ami,  Ji/tfi, 
that  at  the  time  he  did  cut  his  throat  he  was 
insane.  Admitling  that  there  was  some  evi- 
dence to  go  to  the  jury  upon  those  (piestious, 
and  that  those  ([Ueslions  have  been  properly 
submitted  to  them  by  the  court  upon  tiie 
trial,  then  we  are  asketl  lo  say  that  insanity 
being  a  disease,  that  disease  was  the  proxi- 
mate cause  of  the  death  of  the  insured,  and 
that  he  did  not  come  to  his  death  by  an  ex- 
ternal accidental  injury,  within  the  meaning 
of  the  terms  of  the  policy.  In  Insurance  Co. 
v.  Cranilal,  120  f.  S.  527,  7  Sup.  Ct.  Hep. 
(385,  a  policy  similar  in  form  and  conditions 


INSANE  PKUSONS. 


was  issued,  based  iinoii  an  application  in 
siibslance  tiie  same  as  the  one  in  issue  here. 
Mr.  Justice  GitAV,  delivering  the  opinion  of 
tlie  court  in  that  case,  said:  "The  single 
question  to  be  decided,  therefore,  is  whethtT 
H  policy  of  insurance  against  •  bodily  injuries 
cftVctetl  througi)  external,  accidental,  and 
violent  n)eaiis,'  and  occasioning  death,  or 
cou)[)lete  disability  to  do  business,  and  pro- 
viding tliat  '  this  insurance  shall  not  ex- 
tend to  death  or  disability  which  may  have 
been  caused  wholly  or  in  part  by  bodily  in- 
lirniities  or  disease,  or  by  suicide  or  self-in- 
llicted  injuries,'  covers  a  death  by  hanging 
one's  self  while  insane.  The  decisions  upon 
the  effect  of  a  policy  of  life  insurance  which 
provides  that  it  shall  be  void  if  the  assured 
'shall  die  by  suicide,'  or  'shall  die  by  his 
own  hand,'  go  far  towards  detei'mining  this 
question.  This  court,  on  full  consideiation 
of  the  conflicting  authorities  upon  that  sub- 
ject, has  re[)eatedly  and  uniformly  held  that 
such  a  i^rovisjon,  not  containing  the  words 
'sane  or  insane,'  does  not  include  a  self- 
killing  by  an  insane  person,  whetlier  his  un- 
soundness of  mind  is  such  as  to  pre\ent  him 
from  understanding  the  physical  nature  and 
consequences  of  his  act  or  only  such  as  to 
prevent  him,  wiiile  foreseeing  and  premedi- 
tating its  physical  consequences,  from  under- 
standing its  moral  nature  and  aspect;"  citing 
Insurance  Co.  v.  Terry,  15  Wall.  580,  and 
other  cases  in  that  court  since  that  time. 
"In  this  state  of  the  law  there  can  be  no 
doubt,"  sa}s  .Justice  Gray,  "that  the  assured 
did  not  die  'by  suicide,'  within  the  meaning 
of  this  policy;  and  the  same  reasons  are  con- 
clusive against  holding  that  he  died  by  '  self- 
inllicted  injuries.'  If  'self-killing,'  'suicide,' 
'dying  by  his  own  hand,'  cannot  be  pred- 
icated of  an  insane  person,  no  more  can  '  self- 
indicted  injuries,'  for  in  either  case  it  is  not 
liis  act.  Nor  does  the  case  come  within  the 
clause  which  provides  that  the  insurance 
shall  not  extend  to  '  death  or  disability  which 
may  liave  been  caused  wholly  or  in  part  by 
bodily  infirmities  or  disease.'  If  insanity 
could  be  considered  as  coming  within  this 
clause  it  would  be  doubtful,  to  say  tiie  least, 
whether  under  the  rule  of  the  law  of  insur- 
ance which  attributes  an  injury  or  loss  to  its 
proximate  cause  only,  and  in  view  of  the  de- 
cisions in  similar  cases,  the  insanity  of  the 
assured,  or  anything  but  the  act  of  hanging 
himself,  could  be  hel  1  to  be  the  cause  of  his 
death.  *  *  *  The  death  of  the  assured 
not  having  been  the  effect  of  any  cause 
specilied  in  the  proviso  of  the  policy,  and  not 
coming  within  any  warranty  in  the  applica- 
tion, the  question  recurs  whether  it  is  with- 
in the  general  words  of  the  leading  sentence 
of  the  policy  by  which  he  is  declared  to  be 
insured  'against  bodily  injuries  effected 
thiougii  external,  aciidental,  and  violent 
means.'  Tliis  sentence  does  not,  like  the 
proviso,  speak  of  what  the  injury  is  '  caused 
by,'  but  it  looks  only  to  the  '  means  '  by 
which  it  is  el'lected.  No  one  doubis  that 
hanging  is  a  violent  means  of  death,   as  it 


affects  the  body  from  without.  It  is  ex- 
ternal, just  as  suffocation  by  drowning  was 
held  to  be  in  the  cases  of  Trew,  Iteynolds, 
and  Winspear,!  above  cited.  And  according 
to  the  decisions  as  to  suicide  uu  ler  policies 
of  life  insurance  before  referred  to,  it  cannot 
when  done  by  an  insane  person  be  held  to  be 
other  than  accidental." 

Counsel  for  defendant,  considering  this 
case  of  Insurance  Co.  v.  Crandal,  says, 
"that  while  the  court  held  that  insane  self- 
destruction  was  an  accidental  death,  and 
seemed  to  be  of  the  opinion  that  insanity 
was  a  disease,  there  was  no  discussion  by  the 
court  of  the  question  whether  insanity,  be- 
ing a  disease,  would  not  preclude  insane  self- 
destruction  being  an  accidental  death;  that 
the  courtavoided  tlie  discussion  of  this  ques- 
tion by  suggesting  tiuit  though  they  did  not 
decide  that,  in  accordance  with  the  autliori- 
ties  already  discussed,  insanity  was  not  the 
proximate  cause  of  the  death,  and  decided 
that  the  policy  did  not  exempt  the  insurer 
from  liability  for  a  death  of  tiiat  character; 
that  this  was  an  evasion  of  tlie  question 
squarely  presented  to  the  court  for  tiieir  con- 
sideration; that,  regardless  of  the  exceptions 
in  the  policy,  the  company  was  clearly  not 
liable,  unless  the  deatli  was  accidental;  and 
in  deciding  the  case  the  court  was  bound  to 
say  either  that  death  was  not  caused  by  the 
disease  insanity,  or  that  deatii  so  caused  is 
accidental  deatli."  We  think  that  tha  court 
in  that  case  held  tliat,  while  insanity  was  a 
disease,  yet  the  insured,  having  come  to  his 
death  liy  hanging,  though  by  his  own  liaiids, 
met  with  an  accidental  death  within  the 
terms  of  the  policy. 

Counsel  for  defendant  asks,  what  does 
"external"  mean':'  Can  it  be  given  any  con- 
struction that  will  make  it  api)ly  to  violence 
dnne  by  the  insured  himself?  Does  it  refer 
merely  to  the  instrument  of  death?  and  says: 
"I  submit  that  external  violence  is  that  com- 
ing from  sources  outside  of  the  insured. 
Blackstone's  death  came  about  through  in- 
ternal means;  that  it  was  caused  by  his  own 
hand,  in  a  literal,  if  not  in  a  legal,  sense; 
that  his  hand  moved  in  obedience  to  his  will, 
however  darkened  his  will  may  be;  that  it 
was  not  Voluntary;  that  he  was  not  trying 
to  do  something  else;  therefore  the  injury 
was  not  external  or  accidental."  We  do  not 
agree  with  counsel  in  this  proposition.  We 
think  the  insured  c.ime  to  liis  death  by  vio- 
lent, external,  accidental  injuries,  within  the 
meaning  of  this  policy.  AVithout  going  over 
the  reasons  brought  to  bear  upon  the  ques- 
tions, it  is  evident  that  the  words  "died  by 
suicide,"  "death  by  his  own  hands,"  and 
other  words  of  similar  imjiort,  are  held  to  be 
made  ap|>lieable  only  to  tJiat  class  of  cases 
where  the  insured  comes  to  his  death  by  his 
own  voluntary  act.  This  question  has  been 
settled  by  tlie  jury;    that  the  diseased  was 

iTrew  v.  Assurance  Co.,  .5  Hurl.  &  N.  211;  Rey- 
nolds V.  Insurance  Co.,  22  Law  T.  (N.  S.)  82i); 
Wiuspear  v.  Insurance  Co.,  42  Law  T.  (N.  S.)  'JOO, 
affirmed  0  Q.  B.  Div.  42. 


INSANE  PERSONS. 


insane;  that  he  took  his  own  life;  that  lie 
did  not  iiilend  in  cutting  his  throat  to  kill 
himself;  and  that  he  was  not  conscious  that 
liis  death  would  be  occasioned  thereby.  Let 
us  suppose,  as  an  illustration,  that  A.  and 
]J.  take  a  policy  of  like  terms  and  contlitions 
as  tlie  one  in  suit,  based  upon  similar  appli- 
cations, with  all  the  conditions  and  jjrovis- 
ions  contained  in  the  present  case,  and  dur- 
ing the  life-time  of  each  of  those  policies  A. 
becomes  insane,  anJ,  while  so  insane,  with  a 
pistol  slioots  and  kills  B.,  and  in  the  same 
nioment  turns  the  pistol  and  kills  himself. 
No  one  would  question  but  that  by  tlie  terms 
and  conditions  of  B.'s  policy  he  hid  met 
with  an  accidental,  external,  and  violent 
death,  and  the  company  would  be  held  liable; 
that  the  case  came  within  the  [)rovisions  of 
the  policy.  Yet  counsel  for  the  defendant 
contends  that,  conceding  that  B.  cami'  to  his 
deatii  by  accidental,  external,  and  violent 
injuries,  because  intlicted  by  tlie  hand  of  an- 
other, yet  A.,  although  insane,  and  wholly 
unconscious  of  the  act  of  killing,  not  by  force 
of  his  own  will,  but  because  he  was  bereft  of 
reason,  kills  himself,  it  is  not  an  external 
injury  and  accidental  death,  within  the  mean- 
ing of  the  policy.  We  flunk  in  a  case  of 
that  kind  A.'s  death  was  as  much  an  exter- 
nal, violent,  accidental  death  as  was  the 
death  of  B.  A.  is  no  more  responsilile  for 
the  act  than  was  B.  It  was  involuntary;  it 
was  not  the  act  of  his  own  will;  it  was  not 
his  death  by  his  own  hand,  in  legal  contem- 
plation, but  he  came  to  his  death  at  the  hand 
of  a  madman,  though  that  madman  was  him- 
self. We  think  that  the  tlefendant,  under 
the  finding  of  the  jury  in  this  case,  cannot 
now  be  heard  to  say  that  this  was  not  an  ac- 
cidental death,  and  an  external  injury,  com- 
ing within  the  terms  of  the  policy. 

We  tind  cases  in  which  it  is  held  under 
like  policies,  where  one  becoming  insane 
and  falling  down  upon  a  railroad  track  is 
thereby  killed  by  the  passing  of  a  train,  that 
such  cases  come  within  the  provisions  of  the 
policy,  and  the  company  would  b.^  liable.  It 
is  also  held,  where  one,  being  insane,  and 
through  his  insanity  has  placed  himself  in  a 
dangerous  positit)n,  where  he  would  not  have 
been  found  had  he  been  in  his  right  mind, 
and  has  met  with  an  accidental  death  by  rea- 
son of  his  insanity,  that  the  compi.ny  is  lia- 
ble, and  recovery  can  be  had.  That  where 
one  in  a  fit  of  insanity  involuntarily  falls  off 
a  bridge  and  is  killed,  or  falls  into  a  stream 
and  is  drowned, — this  being  involuntary, — ■ 
the  company  is  liable.  Yet  counsel  say  that 
this  class  of  cases  are  external  injuries,  in- 
juries producing  death  of  the  insuied  from 
outside  causes,  ;uid  for  that  reason  the  com- 
pany may  be  held  liable.  We  think  where 
one  is  so  far  beside  himself,  his  intellect  so 
daikened  and  obscured,  that  he  may  be 
neither  morally  nor  legally  responsible  for 
his  own  acts  and  conduct,  and  in  such  condi- 
tion [jroduces  his  own  death,  it  cannot  be  any 
more  said  to  be  his  act  than  though  the  act 
had  been  comm.tted   bv  another,  or  the  in- 


sured had  placed  himself  upon  some  danger- 
ous height  and  fallen  involuntarily,  and  had 
been  dashed  to  pieces. 

Some  other  questions  are  raised  by  the  rec- 
ord, but  we  do  not  deem  them  of  siUficicnt 
importance  to  discuss  them  here.  We  think 
the  case  was  fairly  suiunitted  to  the  jury  by 
the  court,  and  fa.rly  tried.  Tlie  couit,  upon 
this  question  of  insanity  of  the  deceased,  in- 
structed the  jury:  "Jiut,  as  1  have  before 
stated,  the  mere  fact  that  a  man  kills  him- 
self does  not  of  itself  eslablisii  insanity.  A 
man  may  do  that  by  reason,  as  1  stated,  of 
lack  of  courage  to  undertake  the  work  which 
his  life  seems  to  furnish  for  him;  may  get 
discouraged,  and  feel  he  would  rather  take 
his  chances  in  the  life  to  come  than  here. 
And  if  in  that  spirit  he  determined  to  take 
his  own  life,  that  would  not  be  the  taking  of 
his  life  under  the  condition  of  mind  which 
the  law  would  say  was  in  insanity.  If  you 
believe  Air.  Blackstone  took  his  life  under 
such  conditions,  then  the  plaintilT  cannot  re- 
cover; otherwise,  if  you  believe,  as  I  have 
chargeil  you,  that  he  had  no  power  to  do  it, 
and  had  not  capacity  of  mind  to  do  it,  then 
the  plaintiff  would  be  entitled  to  recover,  be- 
cansi\  as  I  have  instructed  you,  death  under 
such  circumstances  would  be  acf.-idental." 

Some  question  is  raised  now  by  the  defend- 
ant that  there  was  proof  of  the  insanity  of 
the  deceased  some  20  years  before  the  time 
of  the  taking  out  of  the  present  policy.  Some 
evidence  was  given  of  this  upon  the  trial. 
Defendant's  counsel  insists  tiiat  this  was  a 
concealment  of  a  fact  from  the  insuran -e 
comjjany  at  the  time  of  the  application  in  the 
present  case.  This  objection  was  overruled 
by  the  court  below,  and  we  think  very  prop- 
erly, under  the  testimony  of  the  defendant's 
own  agent,  Mr.  H.  E.  Rich,  who  took  the 
application  in  the  present  case.  He  testi- 
fied that  he  remembered  taking  the  applica- 
tion; that  he  wrote  the  body  of  it.  He  says 
he  had  a  previous  talk  with  Air.  Blackstone 
coming  across  on  the  .Jackson  bianch  fr«>m 
Tecumseh  to  Adrian,  '"and  we  renewed  our 
talk  in  regard  to  accident  insurance,  and  he 
thought  lie  could  not  alVord  to  lake  so  much. 
1  told  him  he  could  make  it  in  two  payments, 
— pay  part  in  Ihii  ty  days,  and  the  bal.mce  in 
sixty  days,  for  .S5,\»0i),'  and  .•5;25  weekly  in- 
demiiity.'  He  thought  he  would  be  able  to 
make  tJie  payment  in  that  way,  and  said  he 
would  talk  vvith  his  wife  in  regard  to  it,  and 
see  whether  she  thought  he  liad  better  do  st). 
He  never  had  carried  any,  he  said,  but  he 
would  come  in  and  see  me  before  he  lei t  town. 
He  came  in  afterwanls,  and  said  he  had  con- 
cluded to  take  a  policy.  I  took  out  the  a|)- 
jilicatiou  and  filled  it  out.  He  said  he  would 
take  the  amount  we  talked  of,  and  I  asked 
him  his  full  name  and  who  the  beneficiary 
would  be,  and  he  told  me.  I  asked  him  if 
he  had  any  other  accident  insurance,  and  he 
said,  '  No;'  and  1  drew  a  line  Ihrough  it,  and 
turned  to  him, — he  sat  opposite  my  desk, — 
and  told  him  to  sign  on  the  line,— sign  his 
name  in  full,  same  as  I  had  written  it  in  the 


76 


INSANE  PERSONS. 


heading.  He  did  so,  and  1  took  the  applica- 
tion and  put  it  in  my  drawer."  On  cross- 
examination  the  witness  said:  "I  didn't  no- 
tice any  difference  in  him  than  in  any  otiier 
man  tiiat  I  liad  ever  solicited.  He  was  as 
well  informeti  as  ordinary  men  1  talk  with 
on  the  same  subject.  The  question  was  the 
amount  in  cast>  of  death  and  the  amount  of 
indemnity;  that  is  all  that  was  talked  over. 
1  should  say  he  was  an  ordinarily  informed 
man.  Not  more  tlian  ordinarily  well  in- 
formed, as  yon  meet  them  in  solicilinj/  in- 
surance." No  evidence  was  given  or  tend- 
ing to  i)rove  that  Blackstone  was  not  sane  at 
the  time  of  the  taking  of  this  jiolicy,  or  that 
he  had  had  any  trouble  mentally  for  a  period 
of  2lJ  years.  The  court,  in  its  direction  to 
the  jury,  excluded  this  whole  question,  and 
told  the  jury  that  it  was  claimed  on  the  part 
of  the  plaintiff,  who  introduced  the  testi- 
mony, tliat  it  tended  to  establish  the  fact  of 
Lis  insanity  at  the  time  of  committing  the 


act;  tliat  it  was  claimed  on  the  part  of  the 
defendant  that  it  tended  to  establish  tliat  he 
was  subject  to  mental  disease,  and  that 
thorefore,  by  the  terms  of  the  application,  it 
was  a  false  rejjresentation, — that  Hlackstone 
made  a  false  re{)resentation  in  making  the 
application,  as  regards  that  fact.  J3ut  the 
court  said:  "Genllemen,  for  neither  of  these 
purposes,  nor  for  any  otlier  purpose,  nor  for 
any  other  purpose  whatever  in  the  case,  shall 
you  consider  this  testimony."  And  we  think 
the  court  very  properly  excluded  this  from 
the  consideration  of  the  jury.  We  need  not 
diseuss  tiie  other  questions  raised.  The  judg- 
nitnt  of  the  court  below  must  be  affirmed, 
with  costs. 

8HKIIWOOD,   C.   J.,    and   MORSE    and 
CIIAMPLIN,  JJ.,  concurred. 

CAMPBELL,  J.,  concurred  in  the  result. 


MARRIED  WOMEN. 


77 


GILLESPIE  pt  ill.  V.  BEECIIER. 

(54  N.  W.  1()7.  04  Mi.h.  .-574.) 

SuprpiiK-  Court  of  MichiKJiii.      Doc.  23.  1S92. 

Error  to  circuit  court,  Wayne  county; 
'loorge  S.  Ilosnier,  Judgo. 

Action  by  .Tolianna  (4illespie  and  another 
against  Luther  Beeclier  for  unlawfully  dis- 
j)ossessing  plaintiffs  of  promises  leased  to 
Ihoni  by  defendant.  A  verdict  was  directed 
in  defendant's  favor  on  the  opening  state- 
ment of  plaintiffs'  counsel,  and  i)laintiffs  bring 
error.     Reversed. 

James  H.  Poiuid,  for  appellants. 

Henry  M.  Cheever,  for  appellee,  cited  the 
following  cases  on  the  proposition  that  tlie 
l)lainliff  .Tolianna  Gillespie,  a  mari-ied  woman, 
had  no  power  to  enter  into  the  lease:  Ed- 
wards V.  McEnhill,  .51  Mich.  1G6,  16  N.  W. 
Rep.  322;  Tillman  v.  Shackletou,  15  Mich. 
447;  Campbell  v.  Wliito.  22  ISIich.  ITS;  De 
Vries  v.  Conklin.  Id.  255;  Powers  v.  Russell, 
26  Mich.  179;  Emery  v.  Lord,  Id.  431;  West  v. 
Lara  way,  28  ]Mich.  464;  Ross  v.  Walker,  31 
Jilich.  120;  Gillam  v.  Boynton,  36  Mich.  236; 
.Teune  v.  Marble,  37  ISIich.  319;  Kitcheli  v. 
Mudgett,  Id.  81;  Carley  v.  Fox,  38  Mich. 
387;  Johnson  v.  Sutherland,  39  Mich.  579; 
Russel  v.  Savings  Bank,  Id.  671;  Gantz  v. 
Toles,  40  Mich.  725;  Insurance  Co.  v. 
McClellan,  43  Mich.  564.  6  X.  W.  Rep.  88; 
Buhler  v.  Jennings,  49  Mich.  538,  14  N.  W. 
Rep.    488. 

DURAND,  J.  The  ded;! ration  iu  tliis  c.ise 
charges  that  the  plaintiffs,  on  August  3:), 
1SS8,  were  in  possession  of  a  house  and  prem- 
ises which  they  were  using  as  a  dwelling 
house  and  as  an  hotel  and  boarding  house, 
and  that,  being  so  in  possession,  the  defend- 
ant imlaw  fully  and  forcibly  entered  and  took 
possession  thereof,  and  thereafter  maintained 
his  possession  as  against  them,  thus  putting 
them  in  fear,  depriving  tliem  of  tlieir  iiome, 
and  destroying  their  business  as  hotel  or 
boarding  house  keepers.  The  defendant  by 
his  plea  denied  liability.  The  case  came  on 
to  be  tried,  and  in  opening  the  case  to  the 
Jury  plaintiffs'  coimsel  stated  substantially 
that  liL'  intended  to  show  that  plaintiffs  were 
husl)and  and  wife:  that  they  were  possessed 
of  some  property,  and  that  in  Fei)rnai\v,  1S88, 
they  entered  into  a  joint  lease,  in  which  tliey 
were  the  tenants,  and  tlie  defendant  was  the 
lessor,  of  the  Globe  or  Dollar  Hotel,  on  the 
coriior  of  Jefferson  aveiuie  and  Brush  street, 
in  Detroit,  and  wliich  are  the  prcraLses  which 
it  is  claimed  the  defendant  imlawftilly  took 
possession  of;  that  the  lessor  insisted  that 
the  plaintiff  Joh.anna  Gilli^spie  should  join  in 
the  lease  with  her  husband,  and  would  not 
)nake  the  lease  if  she  did  not  join,  and  that 
upon  his  insistence  she  did  so;  tliat  the  lease 
was  then  made  to  them  jointly;  that  they 
entered  into  possession  of  the  premis,'s,  and 


while  in  peaceable  i)osse,ssion  thereof  were 
unlawfully  dispossessed  i)y  defendant;  and 
that  they  sufteri'd  considerable  damage  in 
consequence.  After  this  statement  the  cir- 
cuit judge  said:  "I  think,  with  reference  1o 
this  matter  that  you  m.iy  con.sider,  that  I 
will  direct  a  verdict  on  the  ground  that  it  was 
incompetent  for  the  husl»and  and  wife  lo 
join  in  the  lease  for  the  purpose  of  carrying 
on  a  pai'tnersliip  hi  the  k-'ejiing  of  a  boarding 
house  or  hotel.  1  will  enter  a  <lirection  to  Ihe 
jury  to  return  a  verdict  for  the  defendant  on 
the  ground  that  Mrs.  Gillespie  was  not  a 
pi-oper  parly  to  the  lease."  E.vceplion  was 
taken  to  this  ruling  by  plaintiffs'  counsel, 
and  the  only  question  to  be  i)assed  upon  in 
the  case,  therefore,  is  whether  the  husl)and 
and  wife  could  join  as  i)laintiffs  in  a  suit  to 
recover  for  an  alleged  invasion  of  the  rights 
which  they  claim  under  a  lease  made  by  the 
defendant  to  them  jointly.  We  have  no 
doubt  of  their  inght  to  do  so.  The  defend;;ut 
was  aware  of  the  relation  the  pl.nutiffs  sus- 
tained to  each  other  at  the  time  he  made  the 
lease  to  them,  and  insisted  that  the  wife 
should  be  a  party  to  it.  Having  done  so.  and 
put  them  jointly  into  possession  of  the  prem- 
ises under  it,  he  is  estop;)ed  from  claiming 
that  tli(\v  had  no  right  to  join  in  a  suit  ag  ii:ist 
]]im  when  he  unlawfully  disturbs  them  in 
that  possession,  and  they  sustain  damage 
by  reason  of  such  disturbance.  The  married 
woman's  act  was  passed  for  Iht^  proteeii<»n  of 
married  women.  It  was  intendtnl  as  a  shield, 
and  not  as  a  sword.  Its  purpose  was  to  en- 
large her  rights,  not  to  contract  tlu'in.  and 
certainly  it  was  not  meant  to  deprive  her  of 
the  right,  either  acting  alone,  or  jointly  with 
others,  of  protecting  her  interests  in  proper- 
ty, either  real  or  person:il.  The  authorities 
referred  to  in  the  brief  of  the  defendant's 
counsel  are  all  cases  where  it  was  sought  to 
make  a  married  woman  lial)le  upon  some 
executory  contract,  and  it  has  been  uniform- 
ly held  in  this  state  that  she  cannot  become 
personally  liable  upon  an  executory  contract 
except  when  it  relates  to  hei  sole  property, 
or  where  the  consideration  moves  directly  to 
her,  and  it  has  also  been  held  that  she  cannot 
be  made  liable  personally  as  a  surety  for  the 
debts  either  of  her  husband  or  any  other  per- 
son, or  by  reason  of  her  being  a  partner  \\\\h 
her  husb:ind.  In  all  these  ca.ses  she  is  held 
to  be  legally  incompetent  to  bind  herself. 
These  rules,  however,  are  all  inteniled  for  her 
benefit,  and  are  in  direct  .iniagonism  with  the 
doctrine  that  she  cannot  protect  her  title  or 
possession  to  property  when  such  title  or  pos- 
session, either  as  a  sol.>  or  joint  owner,  is 
attacked.  To  give  sanction  to  such  a  doc- 
trine would  place  marrit'd  women  at  a  se- 
rious disadvantage,  and  one  which  the  law 
does  not  inflict  ui)on  her.  For  the  reasons 
stated  the  judgment  must  be  reversed,  and 
a  new  trial  granted.  The  other  justices  con- 
curred. 


J8 


MARRIED  WOMEN. 


ARTMAN  et  iil.   v.   FERGUSON  et  al. 
(40  N.  W.  !.07.  To  Mich.  14C.) 
Siiiii-ome  Court  ot  MicluKiin.     Nov.  28,  1888. 
I]rior  to  circuit  court,  Jack.son  coiuity;  Lane, 
Judge. 

Thomas  A.  Wilsou,  for  ayi)elkiuls.  Richard 
Price  and  Austin  Blair,  for  appellees. 

LONG,  J.  This  action  is  brought  in  the  cir- 
cuit court  for  the  county  of  Jackson,  on  the 
common  counts  in  assumpsit,  to  recover  for 
goods  sold  and  delivered  to  the  defendants,  do- 
ing business  at  Jackson  as  I'eter  Ferguson  & 
Ck).  The  defendants  are  husband  and  wife, 
and  the  plaintiff  sought  to  show  that,  after 
their  marriage,  they  formed  a  copartnership, 
and  carried  on  the  retail  carpet  business  in  the 
city  of  Jackson  under  the  firm  name  of  Peter 
Ferguson  &  Co.,  and  that  during  such  time 
the  goods  involved  in  this  suit  were  sold  to 
them;  that  Margaret  W.  Ferguson  was,  at  the 
time  of  the  formation  of  such  copartnership, 
possessed  of  property  in  her  own  right,  of  the 
value  of  |;20.W0,  and  furnished  the  entire 
capital  for  the  busine.ss,  and  provided  a  place 
to  carry  on  such  birsiness;  that  Peter  Ferguson 
had  no  means,  and  was  to  and  did  manage  the 
business;  that  the  copartnership  continued  un- 
til after  the  last  item  of  goods  mentioned  in 
the  bill  of  particulars  was  sold.  This  evi- 
dence was  objected  to  by  defendants'  counsel, 
on  the  ground  that  it  was  not  competent  for 
husband  and  wife  to  enter  into  a  copartner- 
ship with  each  other.  The  circuit  court  sus- 
tained the  objection,  and  directed  a  verdict  for 
defendants.  Plaintiffs  bring  the  case  to  this 
court  by  writ  of  error. 

The  only  question  arising  is  whether  the 
husband  and  wife  can  enter  into  a  contract  of 
partnership  between  themselves,  and  thus  ren- 
der themselves  jointly  liable  for  the  contracts 
of  the  firm  thus  established.  At  the  common 
law  married  women  were  incapable  of  form- 
ing a  partner-'-hip,  since  they  were  disaliled, 
generally,  to  contract  or  to  engage  in  trade; 
and  the  husband  and  wife  were  wholly  in- 
capacitated to  contract  with  each  other. 
Whatever  rights  or  powers  the  husband  and 
wife  have  to  contract  with  each  other,  or  that 
the  wife  may  have  to  enter  into  a  copartner- 
ship to  carry  on  trade  or  business,  must  be 
conferred  by  our  constitution  and  statutes. 
Thei-e  was  never  any  impediment  to  the  ac- 
quisition of  property  through  purchase  by  a 
mairied  woman.  The  difficulty  was  that  at 
Che  common  law  the  ownership  passed  imme- 
diately to  the  husband  by  virtue  of  the  mar- 
riage relation.  Our  statute  has  not  removed 
all  the  common-law  disabilities  of  married 
women.  It  has  not  conferred  upon  her  the 
power  of  a  ferae  sole,  except  in  certain  direc- 
tions. It  has  only  provided  that  her  real  and 
personal  estate  acfpured  before  marriage,  and 
all  property,  real  and  personal,  to  which  she 
may  afterwards  become  entitled  in  any  man- 
ner, shall  be  and  remain  her  estate,  and  shah 
not   be  liable   for  the  debts,   ol)ligations.   and 


engagements  of  her  husband,  and  may  be  con- 
tracted, sold,  transferred,  mortgaged,  convey- 
ed, devised,  and  bequeathed  by  her  as  if  she 
were  uiuuarried;  and  she  may  sue  and  be 
sued  in  relation  to  her  sole  property  as  if  she 
were  unmarried.  How.  St.  §§  0295-0297.  In 
all  ether  respects  she  is  a  feme  covei't,  and 
subject  to  all  the  restraints  and  disabilities 
consequent  upon  that  relation.  A  partnership 
is  a  contract  of  two  or  more  competent  per- 
sons to  place  their  monej',  effects,  labor,  and 
skill,  or  some  one  or  all  of  them,  in  lawful 
com.merce  or  business,  and  to  divide  the  profit 
and  bear  the  loss  in  certain  proportions.  That 
a  married  woman  may,  when  she  has  separate 
estiite,  be  a  copartner  with  a  person  other  than 
her  husband,  is  held  in  many  states  under 
the  married  woman's  statutes.  But  where 
the  statute  gives  her  no  power,  or  only  a  lim- 
ited power,  to  become  a  partner,  the  rule  of 
the  common  law  provides  that  she  cannot  enter 
a  firm.  It  has  been  held  by  a  great  preponder- 
ance of  authorities,  even  under  the  broadest 
statutes,  that  a  married  woman  has  no  capac- 
ity to  contract  a  partnership  with  her  hus- 
band, or,  in  other  words,  to  become  a  mem- 
ber of  a  firm  in  which  her  husband  is  a  part- 
ner, even  in  those  states  in  which  she  may 
embark  in  another  partnership;  and  though 
she  holds  herself  out  as  such  partner,  and  her 
means  give  credit  to  the  firm,  she  is  held  not 
liable  for  the  debts,  as  she  cannot,  by  acts  or 
declarations,  remove  her  own  disabilities. 
Lord  V.  Parker,  3  Allen,  127;  Bowker  v.  Brad- 
ford, 140  Mass.  521,  5  N.  E.  480;  Haas  v. 
Shaw,  91  Ind.  384;  Payne  v.  Thompson,  44 
Ohio  St.  192,  5  N.  E.  0-54;  Kaufman  v.  Schoef- 
fel.  37  Hun,  140;  Cox  v.  Miller,  .54  Tex.  16; 
Mayer  v.  Soyster,  30  Md.  402.  In  this  state 
a  married  woman  was  subject  to  the  com- 
mon-law disabilities  of  coverture  until  the  pas- 
sage of  the  married  woman's  act  of  1855. 
How.  St.  §§  6295-G299.  This  act  does  not 
touch  a  wife's  interest  in  her  husband's  prop- 
erty, and  these  remain  under  the  restrictions 
of  the  common  law,  unless  they  are  removed 
by  some  other  statute.  The  wife's  common- 
law  disabilities  are  only  partially  removed  by 
the  act,  and  one  who  relies  on  a  wife's  con- 
tract must  show  the  facts  in  order  that  it 
may  appear  whether  she  had  capacity  to  make 
it.  Edwards  v.  McEnhill,  51  Mich.  161,  16  N. 
W.  322.  LTnder  oiu'  statutes  a  wife  has  no 
power  to  contract  except  in  regard  to  her  sep- 
arate property.  The  constitution  and  statutes 
are  clear  against  her  right  to  make  a  mere 
personsil  obligation  unconnected  with  property, 
and  not  charging  it.  so  that  she  cannot  be- 
come personally  bound  jointly  with  her  hus- 
band, nor  as  a  surety,  by  mere  personal  prom- 
ise. De  Tries  v.  Conklin,  22  Mich.  2.55;  West 
V.  Lain  way,  28  Mich.  404;  Emery  v.  Lord,  26 
Mich.  431.  In  Jenne  v.  Marble,  37  Mich.  326, 
Mr.  .Justice  Campbell,  speaking  with  reference 
to  a  lease,  said:  "The  language  of  tne  stat- 
ute is  no  broader  than  the  equital)le  rules  con- 
cerning separate  property  laid  down  m  the 
same  woi'ds  in  most  of  the  old  decisions.     The 


-MAKKIKI)   WU.MKN. 


79 


Klisabilities  of  testinn)iiy  arc  iMiiiie'.y  iiicuusi.-t- 
<'Ut  with  the  idea  tliat  husluiiul  and  wife  may 
deal  with  each  other  as  tliird  peisuiis  can. 
Tliis  i.s  impossible,  if  they  cannot  testify  con- 
cerninjj  tliese  contracts;  and  when  tlie  law 
rcco;,'nizes.  as  it  always  has  done,  llie  peculiar 
power  of  substantial  coercion  p-jsscssed  by  hus- 
bands over  wives,  it  would  ut)t  be  prt)per  to  in- 
fer anj-  lej^al  intent  to  remove  i)rotection 
.ii.i^ainst  such  intluence  frt)ni  any  vajjue  provi- 
sions which  no  one  suppi'ses  were  ever  actual- 
ly desi;:ued  to  reach  such  a  result,  and  which 
can  only  be  made  to  do  it  by  an  extended  con- 
struction. Any  one  can  readily  see  the  mis- 
chiefs of  allowing  persons  thus  i-elaled  to  put 
thcm.-elves  habitually  in  business  autayonlsm, 
and  leuisliitiou  which  can  be  construed  as  per- 
mit tins  it  is  so  radically  oppostnl  to  the  sys- 
tem which  is  found  embodied  in  our  statutes 
jrenerally  that  it  should  be  plain  enough  to 
iidmit  of  no  other  meaning."  It  is  the  purpose 
of  these  statutes  to  secure  to  a  married  woman 
the  right  to  acquire  and  hoia  property  sepa- 


lale  frcm  her  husband,  and  free  from  his  in- 
fluence and  control,  and  if  she  might  enter  into 
a  business  partnersliijj  with  her  husband  it 
wouhl  subject  her  jiiuperty  to  his  <ontiol  in 
a  manner  wliolly  inconsistent  with  the  separa- 
tion which  it  is  the  pui'i^jse  of  the  statiue  to 
seciue.  and  miglit  sul)je<t  her  to  an  indetinite 
liability  for  his  engagements.  A  contract  cf 
liartiiersliip  with  her  hu.-liand  is  not  included 
williin  the  power  granted  I»y  our  statute  t<t 
married  women.  Tliis  doctrine  was  laid  down 
in  Bassett  v.  Sliepardson.  .VJ  Mich.  :;.  17  N.  W. 
iil7,  and  we  see  no  reason  f(jr  departing  from 
it.  The  important  and  sacred  relations  bi-- 
tween  man  and  wife,  which  lie  at  the  very 
foundaticn  of  civilized  society,  are  not  to  be 
disturbed  and  destroyed  by  c(»iitentioiis  which 
may  arise  from  such  a  conummity  of  property 
and  a  joint  power  of  disposal  and  a  mutual 
lial)ility  for  the  contracts  and  obligations  of 
each  etlier.  The  judgment  of  the  coiut  be- 
low must  be  affirmed,  with  costs.  The  other 
justices  coucuned. 


«() 


MAKKIKD  WUMEN. 


.1.  I.  CASK   l'III{i;siII.\(i    .MACIIINJ':  CO.  V. 
MITCHELL  (>(  ill. 

(42  N.  W.  151,  74  Mich.  (JTU.) 

Siiprcinp   Court  of  Michigan.      April  24,    1S89. 

Appeal  from  circuit  court,  Huron  county, 
in  cliancery;  Watson  13EACir,  Judge. 

Geurye  P.  Voorheis,  for  appellant.  El- 
bridf/e  F.  Bacon,  for  appellees. 

].ONG,  ,T.  On  April  2,  1883,  George  W. 
Mitclit'll  and  wife,  Sarah  .lane  Mitchell,  two 
of  tiie  ahove  defendants,  made  and  executed 
an  indenture  of  mortgage  to  Geoige  W. 
.Tenks,  administrator,  etc.,  coveiing  the  E.  h 
of  the  X.  E.  ^  of  section  22,  township  1(J  X..of 
range  15  E.,  Huron  county,  Mich.  This 
mortgage  was  recorded  in  the  ollici-  oT  iIh> 
register  of  deeds  of  Huron  county,  on  April 
5,  1883,  and  was  thereafter  duly  assigned  in 
writing  by  said  .Tenks  to  Margarett  L.  David- 
son, the  other  defendant.  The  mortgage  was 
given  for  the  sum  of  !i?182.28,  and  was  to 
come  due  on  or  before  April  2,  lfc88,  with 
interest  payal)le annually.  For  non-payment 
of  interest  when  due  thf^  mortgagee  had  the 
option  in  the  said  mortgatre  to  declare  the 
whole  amount  of  principal  and  interest  due, 
and  the  right  to  foreclose  the  same  under  the 
j)()wer  of  sale  contained  in  the  mortgage. 
Tiie  interest  remaining  unpaid  on  November 
10,  I8s7,  the  assignee  of  the  mortgage,  Mrs. 
Davidson,  declared  the  whole  amount  and 
interest  due,  and  commenced  a  stalutory 
foieclosure,  by  the  publication  of  tiie  usual 
notice,  claiming  there  was  due  on  the  mort- 
gage and  note  for  princijial  and  interest  the 
sura  of  .S2.54.78.  On  the  same  day  tliis  mort- 
g;ige  was  given,  (ieorge  \V.  Mitchell  con- 
veyed to  his  wife,  Sarah  .Jane  Mitchell,  the 
north  45  acres  of  the  premises  covered  by 
this  mort'.'age,  by  deed  of  warranty  contain- 
ing the  usual  covenants  of  seisin,  and  that 
the  premises  were  free  fioin  all  incumbran- 
ces. The  north  45  acres  included  the  home- 
stead of  (ieoige  W.  Mitchell  and  wife;  the 
dweliiug-house  and  a[)piirtenances  where 
tliey  resided  being  situate  thereon.  On 
.September  16,  1886,  George  W.  Mitchell, 
being  indebted  to  the  J.  I.  Case  Threshing- 
Marliitie  Company,  complainant,  in  the  sum 
of  ."?70(),  gave  his  promissory  notes  for  that 
amount  to  it;  and  to  secure  the  payment  of 
said  notes  he,  with  his  wife,  Sarah  .Jane 
Mitchell,  made  and  executed  a  mortgage  for 
said  amount  on  the  same  ilate  to  said  com- 
plainant, covering  the  south  35  acres  of  the 
premises  described  in  the  mortgage  to  George 
W.  Jenks.  This  amount  was  due  under  said 
mortgage  in  installments:  .S150,  October, 
1887:  !?200.  December  1,  1887;  .$150.  Octo- 
ber, 1888;  .S210.  December  1,  1888.  Default 
having  been  made  in  the  payment  of  the 
first  two  installments  of  this  mortgage,  on 
February  4,  1858,  complainant  filed  its  bill 
in  the  circuit  court,  in  chancery,  of  Huron 
county,  to  foreclose   said   mortgage,  and  to 


restrain  the  sale  of  the  premises  under  the 
forech.-siire  by  Margarett  L.  Davidson  of  her 
mortgage,  which  was  to  take  place  under 
such  notice  on  February  7,  1888.  Upon  fil- 
ing this  bill,  an  injunction  was  allowed  by 
the  circuit  judge  restraining  tlie  sale  under 
the  Davidson  mortgage.  The  complainant 
in  its  bill  prays  that  Margarett  L.  Davidson 
be  compelled  under  such  foreclosure  to  sell 
the  north  45  acres  of  the  premises  first,  be- 
fore resorting  to  or  selling  the  south  35  acres 
of  the  premises  covered  by  its  mortgage. 
The  defendants  all  appeared  and  answered. 
The  defendant  Sarah  -Jane  Mitchell  in  her 
answer  alleged  her  homestead  interest  in  the 
north  45  acres,  and  her  purchase  from  her 
husband,  and  ])rayed  that  the  south  35  acres 
be  first  sold  under  the  Davidson  mortgage, 
before  sale  should  be  made  of  the  45  acres  so 
owned  by  lier.  Defendant  Davidson  also  an- 
swered, and  prayed  foreclosure  of  her  mort- 
gage upon  the  whole  tract  covered  thereby, 
and  for  her  costs  in  the  proceedings. 

On  tiie  hearing  in  the  circuit,  tlie  court  de- 
creed that  the  south  35  acres  be  first  sold  un- 
der the  Davidson  mortgage,  and  that  if  a 
suHicient  sum  should  be  realized  at  such  sale, 
that  the  north  45  acres  should  be  releasea 
from  the  lien  of  that  mortgage.  The  court 
found  due  on  the  complainant's  mortgage 
the  sum  of  .•?317.80,  and  decreed  that  George 
"W.  Mitchell  pay  the  same,  with  interest  and 
costs,  on  or  before  February  17,  Iciyy,  and 
that  in  default  thereof  a  sale  be  made  of  the 
35  acres  so  covered  by  said  mortgage.  The 
court  also  found  i\ue  on  the  Davidson  mort- 
gage the  sum  of  .$271.46,  and  ordered  pay- 
ment thereof  by  George  \V.  Mitchell  and 
Sarah  .lane  Mitchell,  with  interest  and  costs, 
on  or  before  February  17,  1889;  and  in  de- 
fault that  defendant  Davidson  first  proceed 
to  a  sale  of  the  south  35  acres  of  said  prem- 
ises; and  that,  if  that  was  insutlicient  to  pay 
the  amount  due,  then  a  sale  of  the  north  45 
aeres  to  be  made.  The  court  ordered,  furtiier, 
tliat  complainant  pay  to  ^largarett  L.  David- 
son the  sum  of  .$42.30,  the  amount  of  costs 
and  expenses  incurred  by  her  in  her  foreclos- 
ure proceedings  by  adveilisement.  The  court 
also  decreed  that  complainant  pay  the  sum 
of  .$25  as  costs  to  defendant  Sarah  .Jane 
Mitchell.  From  lliis  decree  complainant  ap- 
peals. 

The  deed  was  made  and  delivered  to  Sarah 
Jane  Mitchell  by  her  husband,  and  by  her 
placed  upon  record,  prior  to  the  time  of  the 
execution  and  delivery  of  the  complainant's 
mortgage.  At  the  time  of  the  taking  of  his 
mortgage  the  complainant  not  only  liad  no- 
tice by  the  record  that  the  whole  80  acres  was 
incumljered  by  the  Davidson  mortgage,  but 
also  that  the  title  to  the  north  45  acres  had 
been  transferred  by  George  W.  Mitchell  to 
his  wife,  Sarah  Jane  Mitchell,  and  that  the 
leg^al  title  to  that  parcel  was  vested  in  her  at 
the  time  of  the  giving  of  the  mortgage  to 
complainant.  Where  a  part  of  the  mortgaged 
premises  has  been  aliened  by  the  mortgagor 


MARRIED  WOMEN. 


81 


subspquent  to  the  moitgage,  tlie  rulo  in 
equity,  on  a  foreclosure  and  sale,  is  to  re- 
quire that  p:irt  of  tiie  premises  in  wliich  the 
mortgagor  has  not  parted  with  his  e(]uity  of 
redemption  to  be  lirst  sold,  and  then,  if  nec- 
essary, tiiat  which  has  been  aliened,  and, 
where  the  latter  is  in  possession  of  different 
vendees,  in  the  inverse  order  of  alienation. 
This  rule  rests  upon  tlie  ground,  chiedy,  that 
where  one  who  is  bound  to  pay  a  moitgage 
confers  upon  others  rights  in  any  portion  of 
tlie  property,  retaining  other  portions  him- 
self, it  is  unjust  that  tiieyshoulii  be  deprived 
of  tiieir  rigiits,  so  long  as  he  has  property 
covered  by  the  mortgage  out  of  which  the 
debt  can  be  made.  In  other  words,  his  debt 
should  be  jiaid  out  of  his  own  estate,  instead 
of  being  charged  in  the  estate  of  his  grantees. 
Mason  v.  Tavne,  ^Valk.  Ch.  4G0;  Cooper  v. 
Bigly,  13  Mich.  463. 

The  deed  from  Mitchell  to  his  wife  con- 
tair.s  the  usual  covenants  of  warranty,  and 
it  is  evident  therefrom  that  it  was  the  inten- 
tion of  the  grantor  in  his  deed  to  charge  the 
part  remaining  in  him  first  to  the  payment 
of  this  mortgage.  These  covenants  of  war- 
ranty became  important  in  determining  the 
intent  of  the  mortgagor  not  to  charge  the 
mortgage  on  the  pro[)erty  sold.  If  the  bill 
had  been  filed  to  foreclose  the  Davidson 
mortgage,  and  the  rights  of  complainant  liad 
not  intervened,  no  one  would  deny  tiie  right 
of  the  defendant  Sarah  J.  Mitchell,  the  gran- 
tee in  the  deed,  to  have  thef  35  acres  remain- 
ing in  her  grantor  first  sold  to  satisfy  the 
mortgage,  before  the  portion  purcliased  by 
her  should  be  made  liable  to  its  payment  un- 
der the  rule  above  stated.  It  is  insisted, 
however,  by  counsel  fur  complainant,  that 
the  defendant  Sarah  J.  Mitche.l,  having 
signed  tiie  Davidson  mortgage,  and  taken  a 
deed  from  her  husband  of  the  45  acres,  it 
was  charged  with  its  proportionate  share  of 
the  lien,  the  same  as  if  she  had  purchased  the 
whole  80.  This  fact  could  not  affect  her 
right  to  have  the  south  35  acres  remaining  in 
her  husband  first  sold.  The  moitgage  was 
given  to  secure  the  juiyment  of  the  debt  of 
the  husband,  and  she  in  its  execution  only 
barred  her  dower.  She  was  not  personally 
liable  for  the  debt,  and  could  not  be  held  lia- 
ble upon  any  covenant  contained  in  the  mort- 
gage. Sucii  a  covenant  would  be  a  mere 
nullity,  so  far  as  her  rights  were  concerned. 
The  statute  does  not  empower  her  to  make 
contracts  generally,  but  only  in  respect  tohnr 
own  proiierty.  Kitchell  v.  Mudgett,  37 
Mich.  b2. 

Counsel  for  complainant  further  contends 
that,  Sarah  J.  Mitchell  having  signed  both 
mortgages,  her  equities  in  and  to  any  portion 
of  the  80  acies  are  not  greater  than  the 
equities  of  the  mortgagees;  and  that,  having 
signed  and  executed  both  mortgages  volun- 
tarily, she  is  estopped  from  assuming  any 
position  that  will  tend  to  depreciate  or  de- 
stroy the  rights  and  equities  created  by  such 
mortgages.     What  rights   and  equities  has 

VAN  Z1I>E  SEI/.  CAS.  SALES — 6 


the  complainant,  as  against  Sarah  J.  Mitchell, 
in  the  north  45  acres  of  this  land?  Its 
mortgage  does  not  cover  this  parcel.  Wiien 
it  took  the  mortgage  the  Davidson  mortgage 
was  a  lien  uj)on  that  ]»arcel  as  well  as  u[)on 
the  south  35  acres,  and  at  that  time  Die  title 
to  this  45  acres  was  in  Mrs.  Mitchell  under  a 
conveyance  from  the  mortgagor  in  the  David- 
son mortgage.  At  this  time  Mrs.  Mitchell 
had  the  right  to  have  this  35  acres  first  sold 
to  ))ay  for  the  Davidson  mortgage.  How  can 
it  be  said  tiiat  by  tiie  giving  of  the  mort^'age 
to  complainant  upon  the  35  acres  Mrs.  Mitch- 
ell lost  her  right  to  have  it  first  sold  to  satisfy 
the  Davidson  mortgage?  This  is  not  so, 
though  she  joined  witli  her  husband  in  its 
execution.  This  was  also  given  to  secure 
the  payment  of  the  debt  of  the  husband,  and 
no  equities  could  arise  in  favor  of  complain- 
ant against  her  to  compel  the  sale  of  her 
land  first  to  pay  and  discharge  the  Davidson 
mortg^ige.  In  Kitchell  v.  Mudyett,  supra,  a 
bill  was  filed  to  foreclose  a  mortgage  signed 
by  the  defendant  as  wife  of  the  mortgagor, 
on  land  belonging  to  the  husband;  the  de- 
fendant having  a  prior  mortgage  on  the  same 
pi"<emises.  It  was  claimed  that  the  wife,  in 
uniting  in  the  mortgage  to  complainant, 
transferred  her  own  mortgage  inieiest,  and 
subjected  it  to  the  lien  of  the  niortgage  siie 
signed.  It  was  held  that  her  act  had  no  such 
effect,  and  her  mortgage  was  given  priority 
of  lien.  Sarah  J.  Mitchell's  rights  in  the  45 
acres  are  in  no  manner  aifected  by  the  giving 
of  this  mortgage  to  the  complainant,  and  no 
equities  arise  in  favor  of  complainant  to 
have  this  parcel  first  sold.  Complainant 
took  its  mortgage  after  the  rights  of  Saiah 
J.  Mitchell  had  become  fixed  under  her  deed 
as  to  the  Davidson  mortgage,  and  that  was 
to  have  the  35  acres  then  remaining  in  her 
husliand,  her  giantor,  first  sold,  to  pay  the 
Davidson  mortgage:  and  the  fact  tiiat  she 
joined  in  the  mortgage  to  complainant  with 
lier  husband  did  not  and  could  not  affect  her 
rights  in  the  45  acres,  and  no  equities  arise 
in  favor  of  complainant  to  have  it  so  de- 
clared. The  only  effect  of  joining  in  this 
mortgage  is  to  bar  any  dower  she  might  have 
U})on  a  foreclosure  and  sale  of  the  premises. 

Some  question  is  raised  by  counsid  for 
complainant  relative  to  costs  allowed  by  the 
court  below.  Maigaretl  L.  Davidson  was 
proceeding  to  a  foreclosure  and  sale  by  ad- 
vertisement of  the  premises  under  her  mort- 
gage. This  she  had  a  right  to  do,  under  the 
power  of  sale  contained  in  the  mortgage. 
Complainant  by  injunction  restrained  the 
sale,  and  made  Mrs.  Davidson  a  party  de- 
fendant to  its  bill,  the  elfect  of  which  was 
that  Mrs.  Davidson  lo.st  her  costs  ami  ex- 
penses incurred  in  the  advertising  of  her 
foreclosure.  These  costs  the  court  very 
properly  allowed  her. 

jNIrs.  Mitchell  was  also  allowed  S25  as 
co'ts  by  the  court  below.  We  think  this 
was  an  amount  which  the  defendant  might 
reasonably  recover.     13y  her  answer  in  the 


82 


MARRIED  WOMEN. 


nature  of  a  cross-bill  she  was  asking  affirm- 
ative relief;  that  is,  that  the  35  acres  be  lirst 
sold  under  the  Davidson  mortgage.  This 
relief  tlie  court  granted,  and  gave  the  defend- 
ant costs  within  tiie  rule. 

Counsel  for  conij)lainant  asks,  on  tiie  hear- 
ing here,  that  it  be  permitted  to  redeem  from 
the  Davidson  mortgage.  Tiiis  will  be  grant- 
ed. The  decree  of  the  court  below  will  be  so 
modi  lied  that  complainant  may  pay  to  Mar- 
garett  L.  Davidson  the  amount  of  the  mort- 
gage as  fixed  by  the  <'ourt  below,  together 
witli  interest  thereon  from  the  date  of  such 
decree  at  the  rate  drawn  by  said  mortgage, 
and  costs  fixed  by  the  court  below  to  be  paid 


to  her  within  90  days  from  date  hereof,  and 
upon  such  payment  be  subrogated  to  all  the 
rights  of  Margarett  L.  Davidson  therein,  and 
all  her  rights  nnder  said  decree,  by  liling  the 
receipts  for  such  payments  with  the  register 
of  this  court.  The  decree  of  the  court  below 
must  be  atlirmed  in  all  other  respects,  except 
as  to  the  time  of  the  payments  of  the  nioney 
to  be  paid  nnder  the  terms  of  said  decree, 
which  siiall  be  paid  within  90  days  from  this 
date,  in  default  of  which  tlie  parties  may 
proceed  to  a  sale  of  the  premises.  The  de- 
fendants, in  addition  to  the  costs  recoverable 
in  the  court  below,  sliall  recover  their  costs 
in  this  court.     The  other  justices  concurred. 


E-llSTENCE  OF  THING  SOLD. 


83 


LOW  ft  al.  V.  PEW  et  al. 

(108  Mass.  347.) 

Suprome  Judicial   Court   of   Massachusetts. 
Essex.     Nov.  Term,  1871. 

Koplevin  ]>y  the  tirm  of  Allred  Low  &:  Co. 
of  a  lot  of  flitchfd  halibut  from  the  as- 
.signees  in  baakiuptcy  of  the  tirm  of  .John 
Low  &  Son,  all  of  Gloucester.  Writ  dated 
Argust  24,  l.Si;9.  The  parties  stated  the  fol- 
1(  wing  case  for  the  judgment  of  the  court: 

On  April  17,  ISOU,  as  the  schooner  Florence 
Reed,  owned  bj-  .John  Low  &  Son,  was  about 
to  sail  from  Gloucester  on  a  fishing  voyage, 
that  firm  received  $1,.jOO  from  the  plaintiffs. 
and  signed  and  gave  the  plaintiffs  the  follow- 
ing writing: 

"We,  .Tohn  Low  &  Son,  hereby  sell,  assign, 
and  set  over  unto  Alfred  Low  &  Company 
all  the  halibut  that  may  be  caught  by  the 
master  and  crew  of  the  schooner  Florence 
Heed  on  the  voyage  upon  which  she  is  about 
to  proceed  from  the  port  of  Gloucester  to  the 
Grand  Banks,  at  the  rate  of  tive  cents  and  a 
quarter  per  pound  for  flitched  halibut,  to  be 
delivered  to  said  Alfred  Low  &  Company  as 
soon  as  said  schooner  arrives  at  said  port  of 
Gloucester,  at  their  wharf.  And  we.  the 
said  John  Low  &  Son,  hereby  acknowledge 
the  receipt  of  $1..50<>  in  part  payment  fof  the 
halibut  that  may  be  caught  by  the  master 
and  crew  of  said  schooner  on  said  voyage." 

In  July,  18G9,  proceedings  in  bankruptcy 
were  begun  against  John  Low  &  Sou  in  tlie 
district  court  of  the  United  States  for  this 
district,  in  which  they  were  adjudged  bank- 
rupts on  August  6th,  and  on  August  2Uth 
these  defendants  were  appointed  the  as- 
signees in  bankruptcy,  and  the  deed  of  as- 
signment was  executed  to  them.  On  Satur- 
day, August  14th,  the  Florence  Reed  arrived 
at  the  port  of  Gloucester  on  her  home  voy- 
age, and  was  hauled  to  the  plaintiff's'  wharf; 
and  on  the  morning  of  Monday,  August  16, 
the  United  States  marshal  took  pos.session  of 
the  vessel  and  cargo  \mder  a  warrant  issued 
to  him  on  August  Gtli  in  the  pi-oceedings  in 
bankruptcy,  and  transferred  his  possession 
to  the  defendants  upon  their  appointment. 

The  catch  of  the  schooner  consisted  of  about 
40,000  potmds  of  halibut,  and  of  some  codfisli. 
Tlie  plaintiffs  demanded  the  halibut  of  the 
defendants,  and  offered  at  the  same  time  fo 
pay  the  price  of  it  at  the  rate  of  five  and  a 
quarter  cents  per  pound,  less  the  .^1..">(X)  al- 
rt^-ady  paid.  The  defendants  refused  the  de-, 
mand;  and  the  plaintiffs  then  replevied  such 
a  quantity  of  the  haliljut  as  represented  the 
amount  of  .?1,.">00  at  that  rate  per  pound,  and 
offered  to  receive  the  rest  of  the  halibut  and 
pay  for  it  at  the  same  rate,  but  the  defend- 
ants refused  to  acknowledge  any  right  what- 
ever of  the  plaintiffs  in  or  to  the  fish. 

If  on  these  facts  the  plaintiffs  were  enti- 
tled to  recover,  they  were  to  have  judgiuent 
for  nominal  damages;  but,  if  otherwise,  the 
defendants  were  to  have  judgment  for  a  re- 


turn, with  damages  equal  to  interest  at  the 
annual  rate  of  si.x  per  cent,  on  the  appraised 
value  of  the  fish  replevied. 

C.  P.  Thompson,  for  plaintiffs.  W.  C.  Eu- 
dicott,  for  defendants. 

MORTON,  J.  By  the  decree  adjudging 
John  liOW  &  Son  bankrui)ts.  all  their  jiropcr- 
ty,  except  such  as  is  exenqited  by  the  bank- 
rupt law,  was  brought  within  the  custody  of 
the  law,  and  by  the  subsequent  assignment 
passed  to  their  assignees.  Williams  v.  Mer- 
ritt,  103  Mass.  184.  The  firm  could  not.  by 
a  subsequent  sale  and  delivery,  transfer  any 
of  such  property  to  the  plaintiff's.  The 
.schooner  which  con*ained  the  halibut  in  suit 
arrived  in  Gloucester  August  14,  1861),  which 
was  after  the  decree  of  bankruptcy.  If  there 
had  been  then  a  sale  and  delivery  to  the 
plaintiffs  of  the  property  replevied,  it  would 
have  been  invalid.  The  plaintiffs  therefore 
show  no  title  to  the  halil)ut  replevied,  unless 
the  eft'ect  of  the  contract  of  April  17,  18(50. 
was  to  vest  in  them  the  property  in  the  hali- 
but before  the  bankruptcy.  It  seems  to  us 
clear,  as  claimed  by  both  parties,  that  this 
was  a  contract  of  sale,  and  not  a  mere  exec- 
utory agreement  to  sell  at  some  future  day. 
The  plaintiffs  cannot  maintain  their  suit  up- 
on any  other  construction,  because,  if  it  is  an 
executory  agreement  to  sell,  the  property  in 
the  halibut  remained  in  the  bankrupts,  and, 
there  being  no  delivery  before  the  bankrupt- 
cy, passed  to  the  assignees.  The  question  in 
the  case  therefore  is  whether  a  sale  of  hali- 
but afterwards  to  be  caught  is  valid,  so  as  to 
pass  to  the  purchaser  the  property  in  tlieni 
when  caught. 

It  is  an  elementaiy  principle  of  the  law 
of  sales  that  a  man  cannot  grant  personal 
propert.v  in  which  he  has  no  interest  or  title. 
To  be  able  to  sell  property,  he  must  have  a 
vested  right  in  it  at  the  time  of  the  sale. 
Thus  it  has  been  held  that  a  mortgage  of 
gcods  which  the  mortgagor  does  not  own  at 
the^time  the  mortgage  is  made,  though  he 
afterwards  acquires  them,  is  void.  Jones  v. 
Richardson,  10  Mete.  (Mass.)  481.  The  same 
principle  is  applicable  to  all  sales  of  personal 
proi)erty.  Rice  v.  Stone,  1  Allen,  ijGCt.  and 
cases  cited;   Head  v.  Goodwin.  'M  Me.  181. 

It  is  equally  w^ell  settled  that  it  is  sutticient 
if  the  seller  has  a  potential  interest  in  the 
thing  .sold.  But  a  mere  possibilit.v  or  ex- 
pectancy of  acquiring  property,  not  coupled 
with  any  interest,  does  not  constitute  a  po- 
tential interest  in  it,  within  the  meaning  of 
this  rule.  The  seller  must  have  a  i)resent  in- 
terest in  the  property  of  which  the  thing  sold 
is  the  product,  growth,  or  increase.  Having 
such  interest,  the  right  to  the  thing  sold, 
when  it  shall  come  into  existence,  is  a  pres- 
ent vested  right,  and  the  sale  of  it  is  valid. 
Thus  a  man  may  sell  the  wool  to  grow  upon 
his  own  sheep,  but  not  upon  the  she^'p  of  an- 
other; or  the  crops  to  gi'ow  upon  his  own 
land,  but  not  upon  land  in  which  he  has  no 


«4 


EXISTENCE  OF  THING  SOLD. 


iracr^st.  2  Kent,  roniin.  (Kith  Ed.)  4(JS  (041) 
Udlc  a;  Joiu's  V.  Uicliardsou,  10  Mete.  (Mass.) 
4Sl;  Bellows  v.  AN'i'lIs.  [Hj  Vt.  ilDO;  Van  Hooy.er 
V.  Cory.  o4  Barb  i);  CrautlKiiii  v.  Hawk-y, 
Hob.  i:v_>. 

Tilt'  same  principU's  have  been  applied  by 
this  court  to  the  assij;iiinent  of  future  waj^es 
or  farniufjs.  in  Mulhall  v.  Quinn.  1  (Jray, 
10."),  an  assijiunieut  of  future  wajrcs.  there 
bein;,'  no  contract  of  service,  was  held  in- 
valid. In  Hartley  v.  Tapley,  2  Gray.  "»(;.">.  it 
was  held  that,  if  a  i>erson  is  under  a  eon- 
tract  of  service,  he  may  assign  his  future 
earuiuiix  j^rowinjj  out  of  such  contract.  The 
distindion  between  the  cases  is  that  in  the 
former  the  future  earnings  are  a  mere  pos- 
sibility, coupled  with  no  interest,  while  in 
the  latter  the  possibility  of  future  earnings 
is  coupled  with  an  interest,  and  the  right  to 
them,  though  contingent,  and  liable  to  be  de- 
feated, is  a  vested  right. 

In  the  case  at  bar,  the  sellers,  at  the  time 


of  the  sale,  had  no  interest  in  the  thing  sold. 
There  was  a  possibility  that  they  might 
catch  halibut;  but  it  was  a  mere  possibility 
and  expectancy,  coupled  with  no  interest. 
We  are  of  opinion  that  they  had  no  actual  or 
potential  jiossession  of  or  interest  in  the  lish, 
and  that  the  sale  to  the  plaintiffs  was  void. 

The  plaintiffs  rely  upon  (Jarduer  v.  Hoeg. 
IS  Pick.  IGS,  and  Tripp  v.  Brownell,  12  Cusii. 
M7().  In  both  of  these  cases  it  was  held  that 
the  lay  or  share  in  the  profits,  which  a  sea- 
man in  a  whaling  voyage  agreed  to  receive 
in  lieu  of  wages,  w^as  assignable.  The  as- 
signment in  each  case  was,  not  of  any  part 
of  the  oil  to  be  made,  but  of  the  debt  which, 
under  the  shipping  articles,  would  become 
due  to  the  seaman  from  the  owners  at  the 
end  of  the  voyage.  The  court  treated  them 
as  cases  of  assignments  of  choses  in  action. 
The  question  upon  which  the  case  at  bar 
turns  did  not  arise,  and  w'as  not  considered. 

-Judgmeut  for  the  defendants. 


EXISTENCE  OF  THING  SOLD. 


85 


BATES   V.    SMITH. 
(47  N.  W.  1^49,  83  Mich.  :!47.) 
Supreme  Court  of  Michigan.     Nov.  '21,  l.SOO. 
Error  to  circuit  court,  Sajjiuaw  coiuiiy;   C. 
H.  Gajje,  Judge. 

Brooks  &  Conway,    for  appcii.-iiu.     Trask 
<!c  Smith,  for  appellee. 

LONG,  .1.  This  is  an  action  of  trover  to 
recover  the  value  of  one-half  interest  in 
a  colt.  The  claim  of  the  plaintiff  is  that 
he  bred  the  mare  of  one  .lames  Eraser  up- 
on shares.  The  contract  as  stated  by  the 
plaintiff  is  that  Eraser  came  to  his  farm, 
and  said  he  wanted  to  breed  his  mare  to 
the  stallion  American  Boy,  then  kept  by 
])laiutitf,  and  that  he  had  no  money;  that 
plaintiff  then  told  him  he  would  breed  the 
mare  on  shares.  ;uid,  if  Mr.  Eraser  would 
come  to  him  at  any  time  within  two  weeks 
and  give  him  ,$."»()  for  the  services  of  the 
horse,  Eraser  could  have  his  (the  plaintiff's) 
half-interest  in  the  colt;  that  the  mare  was 
then  and  there  bred  under  that  arrange- 
ment, but  no  written  contract  was  made. 
James  Eraser  was  called  as  a  witness  for 
the  defendant  upon  the  trial,  and  testified: 
"My  bargain  with  i)laintiff  that,  if  I  did  not 
pay  plaintitf  fifty  dollars  within  three 
mouths,  for  the  service  of  the  stallion,  he 
(plaintiff,)  was  to  own  a  half-interest  in  the 
colt."  On  cross-examination  he  states  the 
arrangement  substantially  as  claimed  by 
plaintiff,  except  that  he  was  to  have  three 
months  in  which  to  pay  the  money.  It  ap- 
pears that  the  mare  was  bred  July  27,  ISSS, 
and  that  the  defendant  purchased  her  from 
Eraser  on  Eebruary  21,  18S9,  paying  therefor 
the  sum  of  .1^300.  Defendant  upon  the  trial 
stated  that  at  the  time  he  purchased  the 
mare  he  had  no  knowledge  that  the  plain- 
tiff made  any  claim  to  her  progeny,  and 
that  plaintiff  n^^-ver  made  any  claim  until 
the  colt  was  four  or  five  months  old.  It 
appeared,  however,  that  before  defeuda'.it 
bought  the  mare  he  was  informed  that 
Eraser  had  bred  to  the  stallion  American 
Boy  then  kept  by  plaintiff,  but  was  not 
advised  that  any  contract  was  made  by 
which  the  plaintiff  was  to  have  a  half-inter- 
est in  the  colt.  Demand  was  made  before 
suit  was  brought,  and  the  defendant  refused 
to  recognize  the  plaintiff's  interest.  Under 
these  facts,  the  plaintiffs  counsel  reqiu'sted 
the  court  to  instruct  the  jury  that  Eraser 
coxdd  not  sell  the  interest  of  plaintiff  in  the 
colt,  and  that  the  colt  when  foaled  was  the 
property  in  common  of  the  plaintiff  and  de- 
feiuhuit,  and  that  the  value  of  the  one-half 
interest  could  be  recovered  in  this  action. 
This  the  court  refused,  and  instructed  the 
.lury  that  if  at  the  time  the  defendant  pur- 
chased the  mare  fi'om  Eraser  he  had  no 
knowledge  of  the  arrangement  made  between 
plaintiff  and  Eraser,  the  title  to  the  colt 
would  pass  to  the  defendant,  but  that  if 
he  did  have  knowledge  of  it,  tlie  title  would 


not  pass.  The  jury  found  a  verdict  in  fa 
vor  of  defendant.  I'laintiff  brings  error.  It 
is  contended  by  plaintiff's  coimsel  that  the 
defendant  was  not  iu  any  sen.se  a  bona  fide 
purchaser  of  the  colt,  but  that,  if  he  were, 
he  could  ae<iuire  from  Eraser  oidy  his  half- 
interest  therein. 

It  is  a  general  rule  that  owners  in  com- 
mon of  property  have  a  right  to  dispose  of 
their  own  inidivided  shares,  but  such  own- 
er cinnot  sell  the  whole  property,  nor  any 
portion  thereof  except  his  own;  and,  if  he 
undertakes  to  disi)ose  of  any  larger  interest 
his  co-owners  are  not  bound  thereby.  Ilus- 
sell  V.  Allen,  13  N.  Y.  173.  The  principle  is 
well  settled  that  a  seller  of  personal  prop- 
erty can  convey  no  greater  title  than  he  has. 
and  it  makes  no  difference  that  the  pur- 
chaser has  no  notice  and  is  ignorant  of  the 
existence  of  the  other  parties  iu  interest. 
Couse  V.  Tregent.  11  Mich.  (!.');  Dunlap  v. 
Gleason.  li;  Mich.  LIS;  Tutlle  v.  Campbel!, 
74  Mich.  (UU),  42  N.  W.  384.  Did  the  con- 
tract, however,  which  plaintiff  claims  he 
made  with  Eraser  convey  to  him  one-half 
interest?  The  property  upon  which  the  con- 
tract was  to  operate  had  no  potential  exist- 
ence. The  mare  at  that  time  had  not  beoi 
bred,  and  it  was  uncertain  that,  when  bred, 
she  would  be  put  iu  foal.  There  was  noth- 
ing in  existence  which  could  be  the  subject 
of  sale.  It  is  essential  to  the  validity  of 
every  executed  contract  of  .sale  that  there 
should  be  a  thing  or  subject-matter  to  be 
contracted  for.  And  if  it  appears  that  the 
subject-matter  of  the  contract  was  not.  ami 
could  not  have  been,  iu  existence  at  the 
time  of  such  contract,  the  contract  itself  is 
of  no  effect,  and  may  be  disregarded  by  ei- 
ther party.  Strickland  v.  Tiu-ner.  7  Exch. 
208;  Hastie  v.  Couturier.  9  Exch.  I(i2.  .">  H. 
L.  Cas.  673;  Eranklin  v.  Long.  7  (Jill  ^:  .!. 
407.  A  mere  possibility  or  contingency,  not 
fottuded  upon  a  right,  or  coupled  with  an 
interest,  cannot  be  the  subject  of  a  present 
sale,  though  it  may  be  of  an  executory  agree- 
ment to  sell.  Purcell  v.  Mather.  ;>">  Ala.  .">70; 
Ia)\v  v.  I'ew,  108  Mass.  347.  Though  the 
subject-matter  of  the  agreement  has  neither 
an  actual  nor  potential  existence,  such  an 
agreement  is  usually  denominated  an  execu- 
tory contract,  and  for  its  violation  the  rem- 
edy of  the  party  injured  is  by  au  action  to  re- 
cover the  damages.  Hutchinson  v.  Eord.  9' 
Bush,  318;  Pierce  v.  Emery,  32  N.  H.  4S4. 
Again,  it  may  be  said  that,  where  one  of 
tv,o  innocent  parties  must  suffer  by  the 
fraud  of  another,  he  shall  bear  the  loss 
who  by  his  conduct  has  enabled  such  third 
party  to  perpetrate  the  fraud.  If  the  con- 
tract was  made  as  claimed  by  the  plaintilf. 
and  there  does  not  seem  to  be  much  con- 
troversy on  this  point,  yet  the  plaintiff  had 
it  in  his  power  to  protect  himself,  under  the 
provisions  of  Act  No.  2S(>.  Tub.  Acts.  18S7. 
This  act  provides  that  the  owner  or  keeper 
of  a  stallion  shall,  after  demand  upon  the 
owner  of  the  mare  for  the  price  agreed  upon 


S6 


EXISTENCE  OF  THING  SOLD. 


ft>r  .siTvicc.  liMvc  ;i  lieu  iipini  tho  >iet  of  such 
stallion  for  tlu"  period  of  six  inoiitlis  iiftor 
the  birth  of  the  foal,  for  the  payment  of 
the  services  of  such  stallion.  In  order,  how- 
ever, to  perfet't  such  lien,  he  must  file  willi 
the  townshi])  clerk  in  the  town  where  such 
dam  is  owned  tlie  afrreement  or  a  true  copy 
of  such  a^'reenient  entered  into  by  the  owner 
of  I  he  dam  for  sncli  services,  together  witli 
the  description  of  such  dam  as  to  ajre,  color, 
or  other  marks  as  the  person  filing  sucli 
agreement  is  able  to  give.  This  filing  is  to 
oi)erate,  under  the  provisions  of  this  act,  as 
a  chattel  mortgage,  and  may  be  enforced 
in  the  same  way.  No  such  steps  were  taken. 
The  mare  remained  in  the  possession  of  tJie 
owner,  Mr.  Fraser,  from  the  time  she  was 
bn  d  until  in  February  following,  when  the 
defendant  purchased  her  without  any  notice, 
so  far  as  this  record  discloses,  of  the  agree- 


nu'Ul  made  between  plaintiff  and  Fraser.  It 
is  shown  that  defendant  was  advised  at  the 
time  he  purchased  that  tlie  mare  had  been 
bred  to  American  Boy,  but  no  notice  was 
given  him  that  plaintiff  had  any  claim  on 
the  foal,  and  there  was  nothing  upon  the 
record  in  tlie  town-clerk's  office  to  give  liim 
any  notice  that  plaintiff  claimed  a  lien  upon 
or  had  any  interest  in  the  foal.  It  cannot 
be  said  that  the  mere  fact  of  notice  of  tlie 
breeding  of  the  mare  to  American  Boy  was 
sufficient  to  put  him  upon  inquiry  as  to  any 
rights  the  owner  of  the  stallion  might  have. 
The  defendant  must  be  regarded  as  a  boua 
fide  purchaser  and  owner  of  the  mare;  and, 
the  title  and  ownership  of  the  foal  following 
the  dam,  he  was  the  rightful  owner  of  the 
foal.  We  see  no  error  in  tlie  case,  and  ilie 
judgment  must  be  affirmed,  with  costs.  The 
other  justices  concurred. 


EXISTENCE  OF  THING  SOLD. 


87 


DICKEY  et  al.  v.  WALDO. 

(5G  N.   W.  GOS,  97  Mifh.  255.) 

Supreme  Court  of  Michigan.      Oct.  27,  1893. 

Error  to  circuit  court,  Alloxan  county; 
George  M.  Buck,  .Juilso. 

Action  by  John  W.  Dickoy  and  Addison 
Lurvey  ajjainst  George  W.  Wahlo  for  the 
conversion  of  peaches  grown  on  defendant's 
land,  and  of  which  phiintiffs  chiimed  to  be 
the  owners  under  a  contract  with  defendant's 
grantor.  There  was  a  judgment  for  phiin- 
tiffs,  and  defendant  brings  error.    Athrnied. 

The  contract  and  findings  referred  to  in 
the  opinion  are  as  foUows: 

Contract:  "Articles  of  agreement,  made 
this  21st  day  of  Februaiy,  A.  D.  1885,  be- 
tween John  Schultz,  of  the  township  of 
Saugatuok,  Allegan  county.  Michigan,  of  the 
first  part,  and  John  W.  Dick':»y  and  Addison 
Lurvey.  of  Douglas,  county  and  state  afore- 
said, of  the  second  part,  witnesseth  as  fol- 
lows: The  said  party  of  the  first  part  is 
the  owner  of  the  west  half  of  the  east  half 
of  the  southwest  quarter  of  section  twenty- 
five,  township  of  Saugatuck.  aforesaid,  and 
desiring  to  set  out  to  peach  trees  a  piece 
iust  east  of  his  house,  and  running  back  to 
bis  east  line,  and  far  enough  south  as  the 
piece  is  suitable  for  peach  trees,  but  not 
to  exceed  1,.500  trees,  said  first  party  agi-ees 
to  set  out  the  trees,  and  care  for  and  culti- 
vate the  same,  in  a  good  and  workmanlike 
nuinner,  for  the  period  of  ten  yeai"s  from  the 
date  hereof,  and  to  allow  said  Dickey  and 
Lurvey,  parties  of  the  second  part,  to  have 
and  take  one-half  of  the  crop  of  peaches 
for  any  two  years  they  may  select  during 
the  aforesaid  term  of  ten  years.  Said  Seliultz 
agrees  that,  if  it  shall  come  to  his  knowledire 
that  any  of  the  said  trees  are  affected  with  the 
yellows,  that  he  will  inunediately  dig  up  and 
bum  the  same,  root  and  bmnch.  Said 
Dickey  and  Lurvey,  parties  of  the  second 
part,  hereby  agree,  in  consideration  of  the 
agreements  hereinbefore  stated,  to  be  per- 
formed upon  the  part  of  the  said  Schultz, 
to  fnrnish  what  trees  may  be  needed  to  set 
the  aforesaid  piece  of  land,  not  to  exceed 
1,500  trees,  and  take  as  pay  therefor  one 
half  of  the  crop  of  peaches  for  any  two 
years  they  may  select.  It  is  mutually  agi-eed 
that  said  Dickey  and  Liu-vey  shall  make 
their  selec-tion  of  the  year  when  they  will 
take  the  half  of  the  crop  on  or  before  Sep- 
tember 15th  of  that  year.  Each  party  hereto 
are  to  pick  and  care  for  their  own  share 
of  the  fruit  and  are  to  each  take  as  near 
half  of  the  crop  as  may  be:  but  at  the  close 
of  the  season  each  shall  show  up  their  total 
shipments  for  the  season,  and.  if  it  be  foimd 
one  party  has  taken  more  than  the  other, 
the  net  pi'oceeds  of  such  sui-plus  shall  be 
.equally  divided  between  the  parties  hereto. 
Said  Schultz  agrees  to  draw  that  half  of  the 
fruit  belonging  to  said  Dickey  and  Lurvey 
to  the  boat  landing  in  Douglas,  or  railroad 


depot  at  Fennville,  as  they  may  direct.  This 
agreement  to  be  binding  upon  the  legal  rep- 
resentatives of  the  parties  hereto.  Said  .sec- 
ond party  agrees  to  furnish  a  man  to  help 
set  out  the  trees.  Witness  our  hands  and 
seals.  John  W.  Dickey.  [L.  S.]  John  Schultz. 
[L.  S.]  A.  Lurvey.  [L.  S.]  In  presence  of 
May  Belle  Spencer,  Dyer  C.  Putnam. 

"Stite  of  Michigan,  County  of  Allegan,  ss.: 
On  this  third  day  of  March,  A.  D.  18S5,  be- 
fore me,  a  notary  public  in  and  for  said 
county,  personally  came  John  W.  Dickey, 
Addison  Lurvey,  and  John  Schultz,  to  me 
known  to  be  the  persons  whose  names  are 
subscribed  to  the  written  instniment  here- 
on, and  each  acknowledged  that  they  exe- 
cutetl  the  same  for  the  purpose  therein  men- 
tioned.   Dyer  C.  Putnam,  Notary  Public." 

'•Counsel  for  the  respective  parties  above 
named  having  requested  the  court  to  make 
and  tile  in  said  cause  a  finding  of  the  facts, 
and  conclusions  of  law  therefrom,  the  court, 
in  compliance  v\ith  such  request,  finds  the 
facts  in  said  cause,  as  provetl  on  the  trial 
thereof,  to  be  as  follows:  (1)  That  on  the 
21st  day  of  February,  A.  D.  1885,  John 
Schultz  was  the  owner  and  in  possession  of 
the  west  half  of  the  east  half  of  the  south- 
west quarter  of  section  twenty-five,  in  the 
township  of  Saugatuck,  in  said  Allegan  coun- 
ty, and  state  aforesaid.  (2)  That  on  said 
day  above  named  the  said  John  Schultz  en- 
tered into  a  contract  in  writing  with  the 
said  plaintiffs,  which  contract  bore  date  the 
day  and  year  aforesaid,  and  w:is  introduceil 
in  evidence  on  the  trial  of  said  cause.  (3) 
That,  at  the  time  said  contract  was  enteretl 
into,  said  parcel  of  land  described  in  said 
contract  was  the  homestead  of  said  John 
Schultz  and  Deliorah  Schultz,  his  wife.  ,4) 
Ihat  the  plaintiffs,  in  the  spring  of  1885,  fur- 
nished the  peach  trees  required  in  and  by 
the  terms  of  said  contract,  and  set  them  on 
the  land  described  in  said  contract,  and  in 
all  things  performed  the  agi-eements  by  them 
to  be  performed,  according  to  the  terms  of 
said  contract.  (5)  That  on  or  abouf  the  2.'>d 
day  of  April,  A.  D.  1887,  the  said  John 
Schultz  and  wife  convej'ed  the  premises  de- 
scribed in  said  contract  to  ttie  defendant  by 
warranty  deed,  with  covenants  of  title,  and 
against  inciunbrances.  (G)  That,  before  and 
at  the  time  of  the  execution  and  delivery  of, 
said  deed  bj-  said  John  Schultz  and  wife  to 
said  defendant,  he,  the  said  defendant,  had 
actu.d  notice  and  knowleilge  of  the  existence 
and  terms  of  said  contract  between  said 
Schultz  and  said  plaintiffs,  and  that,  before 
and  at  the  time  of  the  execution  and  deliv- 
ery of  said  dee<l.  it  was  agreed  between  said 
Schultz  and  said  defendant  that  said  defend- 
ant should  pay  said  Schultz  $1,850  for  said 
land,  instead  of  $2,000,  the  full  purchase  price 
thereof,  and  that,  as  part  of  the  considera- 
tion for  the  sale  of  said  land,  said  defend- 
ant should  settle  with  said  plaintiffs  for 
their  interest  in  the  peach  trees  on  said 
land;    said  defendant   at  that  time  suppos- 


88 


EXISTENCE  OF  THING  SOLD. 


ing  that  said  plaintifTs  woukl  tako  for  their 
iutiTost  in  said  trees  (he  value  of  said  trees 
at  tlie  time  of  seltiiij;,  and  interest  thereon. 
(7)  That  the  plaintilTs  duly  selected  the  j'ear 
ISDl  as  one  of  the  years  when  they  woukl 
take  one-half  of  the  crop,  according  to  the 
terms  of  said  contract;  that  said  defend- 
ant was  orally  informed  by  said  plaintiffs  of 
such  selection  .July  4,  1SI»1,  and  that  on  or 
about  August  22,  1S!)1,  the  said  plaintiffs 
gave  said  defendant  written  notice  of  such 
selection,  and  afterwards,  and  on  or  about 
the  L'drh  day  of  August,  ISDl,  offered  and 
attempteil  to  pick  their  share  of  the  fruit, 
but  defendant  refused  to  permit  them  to  do 
so.  ;iiid  denied  that  they  had  any  share  of 
tlie  fruit;  and  that  defendant  took  and  con- 
verted to  his  own  use  the  entire  crop  of 
fruit  grown  on  said  trees  during  that  year. 
(N)  Tliat  the  value  of  the  peaches  grown  dur- 
ing the  year  1891  on  the  trees  set  by  said 
plaintitfs  on  said  land,  imder  said  contract, 
amounted  to  the  sum  of  $1,541.07  at  the 
tinu>  of  the  conversion  of  the  same  by  said 
defendant  to  his  own  use,  and  that  the  value 
of  one-half  of  the  peaches,  at  the  time  when 
they  were  so  converted  by  said  defendant  to 
his  own  use,  was  the  sum  of  $770.53.  (9) 
That  the  value  of  one-half  of  the  peaches 
converted  to  his  own  use  by  said  defendant 
before  August  22,  1S91,  was  the  sum  of  .$1G0, 
as  near  as  the  same  can  be  now  determined. 
From  the  foregoing  facts,  I  tind  the  follow- 
ing conclusions  of  law:  (1)  The  plaintiffs  are 
entitled  to  maintain  this  action,  and  the  con- 
tract ott'ered  in  evidence  between  said 
Schultz  and  .said  plaintiffs  was  admissible  in 
evidence.  (2)  Said  contract  did  not  convey 
to  the  plaintiffs  any  interest  in  the  land  de- 
scnhed  in  said  contract,  except  the  right  to 
said  plaintiffs  to  take  therefrom  one-half  of 
the  crop  of  p(>aches  for  any  two  years  they 
might  select  during  the  period  of  ten  years 
from  the  date  of  said  contract.  (3)  The 
homestead  right  of  .Tohn  Schultz  and  wife 
was  in  no  way  affected  by  said  contract, 
and  the  question  of  the  homestead  right  of 
said  Scliultz  and  wife  cannot  be  raised  by 
said  defendant  in  this  action.  (4)  Whether 
said  contract  was  entitled  to  record  or  not, 
or  whether  such  record  would  be  construc- 
tive notice  to  defendant  or  not,  is  immate- 
rial, inasnuich  as  defendant  had  actual  no- 
tice of  such  contract  before  he  purchased 
said  land.  (5)  The  contract  relation  between 
Schultz  and  plaintiffs  was  not  technically  a 
sale  of  the  peaches  thereafter  to  be  grown 
on  said  trees  by  said  Schultz  to  plaintiffs, 
but  was  more  in  the  nature  of  a  sale  of  the 
trees  ))y  plaintiffs  to  Schultz;  plaintiffs  re- 
[Jerving,  in  writing,  one-half  of  the  products 
of  said  ti"ees  for  any  two  years  they  might 
select  during  the  period  of  ten  years.  (0) 
The  defendant,  having  notice  of  said  contract 
before  his  purchase  of  said  land,  and  hav- 
ing agreed,  for  a  valuable  consideration,  to 
recognize  the  rights  of  plaintiffs  inider  said 
contract,    cannot   now   claim    that   said    con- 


tract was  void,  or  that  it  was  not  binding 
upon  him.  (7)  The  defenaant  and  plaintiffs 
were  the  owners  in  common  of  the  crop  of 
peaches  grown  on  said  ti*ees  during  the  sea- 
sou  of  1891,  and  the  defendant  having  re- 
fused to  allow  plauitiffs  to  pick  their  share 
of  said  crop,  and  denied  that  plaintiffs  had 
any  right  to  any  part  of  said  crop,  plaintiffs 
were  entitled  to  their  action  of  trover  with- 
out and  before  any  accounting  as  to  the 
amount  of  said  crop,  or  the  share  of  each 
of  the  others  therein.  (8)  I'laintiffs  are  en- 
titled to  recover  in  this  action,  and  a  judg- 
ment should  be  rendered  in  their  favor,  and 
against  said  defendant,  for  the  said  sum  of 
.$770.53,  with  interest  on  the  same  from  Oc- 
tober 15,  1891,— $23.12,— making  a  total  of 
$793.05.  with  costs  of  suit  to  be  taxed. 
Geo.  M.  Buck,  Circuit  .Tudge.  April  15th, 
1892." 

W.  B.  Williams  i*i  Son,  (Hanibal  Hart,  of 
counsel,)  for  appellant.  Padgham  &  Butler, 
for  api)ellees. 

GRANT,  J.  The  contract  and  the  finding 
of  facts  in  this  case  are  foiind  in  the  margin. 
This  contract  and  the  judgment  should  be 
sustained,  unless  there  are  some  inexorable 
rules  of  law  which  stand  in  the  way.  Two 
rules  are  invoked  to  defeat  the  plaintiff's' 
action:  (1)  That  the  Land  upon  which  the 
peach  trees  were  planted  is  a  homestead; 
that  Schidtz's  wife  did  not  sign  the  contract; 
that  it  interferes  with  the  homestead  right, 
and  the  contract  is  therefore  void.  (2)  That 
the  crop  which  the  plaintiff's  agreed  to  take 
in  payment  for  the  trees  was  not  in  esse  at 
the  time,  and  therefore  not  the  subject  of 
sale. 

1.  We  think  there  is  no  force  in  the  first 
proposition.  Schultz's  land  consisted  of  40 
acres.  The  trees  were  planted  upon  only 
a  portion  of  it.  The  occupation  and  pos- 
session of  the  buildings  and  land  were  not 
interfered  with.  During  the  growth  of  the 
trees,  the  land  could  be  cultivated,  and 
crops  raised.  If  the  trees  proved  valueless, 
neither  Schultz  nor  his  wife  had  suffered. 
If  they  proved  valuable,  which  was  the  fact, 
then  the  homcvstead  itself  was  increased  in 
value.  Under  these  circumstances,  we  see 
no  reason  in  holding  that  either  Schultz  or 
his  wife  had  parted  with  any  homestead 
right,  or  that  their  possession  was  in  any 
manner  interrupted. 

2.  Such  conti'acts  are  reasonable,  and  bene- 
ficial to  both  the  vendor  and  the  vendee. 
They  are  especially  beneficial  to  the  vendee. 
He  avoids  all  expense  except  his  labor,  runs 
no  risk,  and,  if  in  indigent  circumstances, 
he  may  obtain  gains  which  would  otherwise 
be  beyond  his  reach.  Such  contracts  are  of 
common  occun-euce,  and,  if  the  rigid  rules 
of  law  are  against  their  validity,  there  is  a 
necessity  of  legislative  action  to  render  them 
valid.  The  rule  of  law  is  well  established 
that  things  having  no  potential  existence 
cannot  be  the  subject  of  mortgage  and  sale. 


EXISTENCE  OF  THING  SOLD. 


89- 


There  are,  however,  exceptions  to  this  rule, 
as  where  a  merchant  niortf^a^es  his  stock 
of  goods,  and  all  fxitin-e  a(hlitions  tliereto. 
It  is  unnecessary  to  cite  autliorities  to  this 
l)n)i»()Sition.  Tlie  ditllculty  seems  to  arise  in  de- 
Krniiniug  what  comes  within  the  detinitiou  of 
the  term  "potential  existence."  The  detini- 
tion  of  the  word  "potential"  is:  "Havin;,'  la- 
tent power;  endowed  with  energy  ade(iuate 
to  a  result;  efficacious;  existing  in  possibil- 
ity, not  in  actuality."  Sir  AV.  Hamilton  said: 
"Potential  existence  means  merely  that  the 
thing  may  be  at  some  time;  actual  existence, 
that  it  now  is."  In  the  legal  sense,  things 
are  said  to  have  a  potential  existence  when 
they  are  the  natm-al  product  or  expected  in- 
crease of  something  alr«>ady  ])elonging  to 
the  vendor.  When  one  posscs.^os  a  thing 
from  Avliich  a  certain  product,  in  the  very 
nature  of  tilings,  may  be  expected,  such  prod- 
uct, Ave  think,  has  a  potential  existence. 
The  following  rule  appears  to  be  Avell  es- 
tablished both  by  reason  and  authoi-ity, 
viz.:  That,  while  one  owns  property  from 
which  such  product  naturally  arises,  such 
product  may  be  the  subject  of  sale  and  mort- 
gage. The  authorities  which  thus  hold  also 
recognize  the  other  rule  above  stated.  Tlie 
authorities  are  by  no  means  imiform,  but 
we  think  the  conflict  in  them  has  arisen 
from  a  failure  to  make  a  proper  distinction. 
In  Granth.-m  v.  Hawley,  Hob.  132,  it  was 
held  that  a  grant  of  that  wliich  the  gi-antor 
has  potentially,  though  not  actually,  is  good, 
as  a  gi-ant  by  the  lessee  of  all  the  corn  that 
shall  be  growing  on  the  land  at  the  end  of 
the  tei-m.  It  was  there  said:  "Though  the 
lessor  had  it  [the  corn]  not  actually  in  him, 
nor  certain,  yet  he  had  it  potentially,  for 
the  land  is  the  mother  and  root  of  all  fruits. 
Therefore,  he  that  hath  it  may  grant  all 
fruits  that  may  arise  upon  it  after,  and  the 
property  shall  pass  as  soon  as  the  fruits 
are  extant.  A  person  may  grant  all  the 
tithe  wool  that  he  shall  have  in  such  a  year, 
yet  perhaps  he  shall  have  none;  but  a  man 
cannotf  grant  all  the  wool  that  shall  gi-ow 
upon  his  sheep  that  he  shall  buy  hereafter, 
for  there  he  hath  it  neither  actually  nor 
potentially."  Powell,  in  his  Treatise  on  Con- 
tracts, says:  "Although  it  be  uncertain 
whether  the  thing  gi-anted  will  ever  exist, 
and  it  consequently  cannot  be  actually  in  the 
gi'antor,  or  cert^iin,  yet  it  is  in  him  potential- 
l.v,  as  being  a  thing  accessory  to  sometliing 
Avhich  he  actually  has  in  him,  for  such  po- 
tential property  may  be  the  subject  of  a  con- 
tract executed,  as  a  grant,  or  the  like. 
*  *  *  So  a  tenant  for  life  may  sell  the 
profits  of  his  lands  for  three  or  four  years  to 
come,  and  yet  the  profits  are  not  then  in 
esse."  It  is  held  that  a  lease  of  land,  reserv- 
ing rent,  and  which  provides  that  all  the 
crops  raised  on  the  land  diiring  the  term  are 
to  be  the  property  of  the  lessor  until  the 
rent  is  paid,  is'  valid,  and  will  entitle  the 
lessor  to  hold  such  crops  against  the  credit- 
ors of  the  lessee.    Smith  v.   Atkins,    18   Vt. 


461.  .Tustice  Redfield.  in  delivering  the  opin- 
ion, said:  "It  is,  without  doubt,  true  that 
the  sale  of  a  thing  not  in  existence  is,  upon 
general  principles,  inoperative,  being  merely 
executory;  that  is,  it  confers  no  title  in  the 
thing  liargained.  But  when  the  thing  ihcn-- 
after  to  be  produced  is  the  produce  of  land, 
or  other  thing,  the  owner  of  the  principal 
thing  may  retain  the  general  property  of 
the  thing  pro(luc(>d,  unless  there  l)e  fraud 
in  the  contract,  and  it  be  entered  into  mere- 
ly to  defeat  creditors."  In  Jones  v.  Wel)- 
ster,  48  Ala.  112,  it  is  said:  "If  the  mort- 
gagors had  undertaken  to  convey  the  future 
crops  they  might  make,  AA'ithout  possessing 
any  land  ui)on  which  to  make  them,  and 
especially  without  the  contemplation  of  the 
imuKHliate  ac<iuisition  of  some,  then,  cer- 
tainly, their  conveyance  would  be  without 
operation.  In  this  case  they  had  the  land, 
and  the  crops  conveyed  were  to  be  grown 
upon  it  during  their  possessory  interest. 
The  crops  were  an  accretion  or  addition  to 
the  land  which  might  very  reasonably  be 
expected  to  be  made.  They  were  th(n-efore 
proper  subjects  of  mortgage."  In  McCaffrey 
v.  Woodin,  05  N.  Y.  4(54,  it  is  said:  "It  is 
well  settled  that  a  grant  of  the  future  prod- 
uce of  land  actually  in  possession  of  the 
grantor  at  the  time  of  the  grant  passes  an 
interest  in  such  futiu-e  crop  as  soon  as  it 
comes  into  existence."  It  was  held  in  An- 
drew v.  Newcomb,  82  N.  Y.  417.— Chief  Jus- 
tice Denio  rendering  the  opinion,— that  crops 
to  be  raised  by  the  owner  of  the  laud  are 
an  exception  to  the  general  rule  that  the 
"title  to  property  not  in  existence  cannot  be 
afPected  so  as  to  vest  the  title  when  it  comes 
into  existence,"  and  that  "the  owner  of 
land  may  lawfully  contract  for  its  cultiva- 
tion, and  may  provide  in  whom  the  owner- 
ship of  the  product  shall  vest."  In  Wat- 
kins  V.  Wyatt,  9  Baxt.  2.j0,  Wyatt  agreeil 
to  fm-nish  one  McCain  with  supplies  on  con- 
dition that  McCain,  who  wjus  a  farmer,  should 
execute  to  him  a  mortgage  of  his  cotton 
crop  for  the  then  current  year  as  security 
for  the  supplies  so  fiu-nished  "to  enable  him 
(McCain)  to  make  said  crop."  The  crop  was 
not  then  sown.  This  case  cites  many  of  the 
above  authorities,  and  others.  It  recognizes 
that  there  is  a  seeming  conflict  in  the  ad- 
judged cases  upon  the  subject,  but  siLstains 
the  validity  of  the  mortgage.  It  is  there 
said:  "The  riglit  in  the  proprietor  of  the 
soil  to  plant,  cultivate,  and  gather  his  crops, 
to  the  exclusion  of  all  others,  is  an  absolute 
legal  right,  and  an  ineonioreal  property, 
and  ineonioreal  property  is  as  well  the  sub- 
ject of  valid  sale  and  mortgage  as  any  other 
kind  of  proi)erty.  The  mortgagor,  in  this 
case,  was  the  proprietor  of  the  land  on 
which  he  proposed  to  raise  the  crop  in  con- 
troversy. The  crop  had  a  potential  exist- 
ence, because  it  was  to  be  the  natural  prcxl- 
uct  and  expected  increase  of  the  land  then 
owned  and  occupied  by  him."  The  like  con- 
tract   was    sustained    in    Butt   v.    Ellett,    19 


-90 


EXISTENCE  OF  THING  SOLD. 


Wall.  544.  This  diK'trine  is  also  sustained 
by  the  following?  authoritios:  Arquos  v.  Was- 
son,  51  Cal.  (iJO;  Coiiderman  v.  Smith,  41 
Barb.  404;  Van  Iloozor  v.  Corj',  34  Barb.  10; 
S(>iitor  V.  Mitchell,  16  Fed.  liep-  -00.  In 
K(>l>l>ins  V.  McKnijjht,  5  N.  J.  Eq  (i4'J,  the 
contract  was  in  all  essential  features  identi- 
cal with  the  one  hero  involved,  and  it  was 
sustained  by  the  court.  In  the  present  case 
the  trees  were  in  existence  at  the  time  of  the 
contract,  were  transferred  to  and  became 
the  propoi'ty  of  Schultz,  the  vendee,  subject 
to  a  share  of  the  crops  for  the  years  speci- 
liivl;  the  contract  wa.s  executed  b.v  the  plain- 
tiffs, and  operated  to  the  great  b(>nefit  of 
Schultz  and  his  gi"xntee,  the  defendant.  This 
contract  is  one  that  the  law  ou^ht  to  delight 
in  sustaining.  If  it  cannot  be  sustained, 
then  no  executed  contract  can  be,  where  a 
party  furnishes  seed,  and  puts  in  the  crop 
upon  shares.  The  same  reason  that  would 
defeat  the  right  to  recovery  for  the  crop 
of  poaches  in  this  case  would  defeat  the 
right  to  recover  a  crop  of  corn,  wheat,  or 
other  grain,  or  strawberries  and  other  fruits 


of  like  cliaracter.  The  defendant  purchased 
with  notice,  and  the  purchase  price  was  re- 
duced on  account  of  the  plaintiffs'  rijhts  in 
the  crop.  We  think  that  luider  the  authori- 
ties above  cited,  as  well  as  in  reason  and 
justice,  plaintiffs  and  Schultz  became  ten- 
ants in  common  of  the  peaches  for  the  years 
which  they  should  select,  and  that  defend- 
ant, having  purchased  with  notice,  stood  in 
the  same  relation  to  plaintiffs  that  did  his 
grantor.  Defendant's  counsel  cite  Bates  v. 
Smith,  83  Mich.  347,  47  N.  W.  Rep.  249,  and 
insist  that  it  controls  this  case  in  their 
favor.  The  language  of  that  case  is  broad, 
and,  if  strictly  followed,  would  seem  to  iu- 
clude  the  present  one;  but  we  think  the 
authorities  above  cited  make  a  clear  distinc- 
tion between  the  natural  products  of  the 
soil,  wool  from  sheep,  milk  from  cows,  and 
the  like,  from  the  case  that  was  then  under 
consideration,  and  we  are  disposed  to  fol- 
low them.  The  language  of  that  case  must 
be  construed  in  connection  with  its  facts. 
.Judgment  affirmed.  The  other  justices  con- 
cmTed. 


EXISTENCE  OF  THING  SOLD. 


'Jl 


SENTER  et  al.  v.  MITCHELL. 

(16  Fed.  203.) 

Circuit   Court,   E.    D.   Arliansas.      April    TtTui, 
1883. 

Smoote  &  McRae  and  U.  M.  &  G.  B.  Rose, 
for  plaintiffs.  W.  G.  Whipple,  for  defend- 
ant. 

CALDWELL,  J.  On  the  loth  day  of  No- 
vember, 18S1,  the  defendant,  Austin  Mitt-hell, 
was  indebted  to  Milner  &  Collins  in  the  sum 
of  .$1,T(')7.(j!>,  evidenced  by  a  negotiable  prom- 
issory note  of  that  date,  and,  to  secure  pay- 
ment of  the  same  executed  a  mortgage  on  that 
day  on  certain  real  estate  and  "30  bales  of 
go<  d  lint  cotton,  the  first  picking  of  our  crop 
of  1882.  to  aveiage  4."iO  pounds  each,  to  be  de- 
livered in  Prescott,  Nevada  county.  Arkansas, 
on  or  before  the  1st  day  of  November.  1882." 

On  the  19th  of  December,  1881,  Milner  & 
Collins  indorsed  the  note,  and  transferred  the 
mortgage  to  the  plaintiffs.  The  defendant  did 
not  deliver  the  cotton  at  the  time  and  place 
appointed  in  the  mortgage,  and  asked  and  ob- 
tained an  extensio-i  of  time  for  that  purpose. 
He  failed  a  second  and  third  time  to  deliver 
the  cotton  as  he  had  promised  and  agreed  to 
do.  Each  time  he  gave  some  plausible  ex- 
cuse for  his  default,  and  continued  thus  to  be- 
guile the  plaintiffs  until  he  had  gathered, 
baled,  and  sold  his  whole  cotton  crop.  Dur- 
ing this  time  he  also  sold  all  his  other  property 
of  any  value  liable  to  seizure  for  debt,  except 
the  real  estate  embraced  in  the  mortgage. 
After  selling  the  cotton  covered  by  the  plain- 
tiffs' mortgage,  he  admitted  he  had  the  pro- 
ceeds, amounting  to  $800,  but  declined  to  pay 
the  same,  or  any  part  of  it,  to  the  plaintiffs 
unless  they  would  release  the  mortgage  on  the 
real  estate.  No  part  of  the  plaintiffs'  debt 
has  been  paid,  the  real  estate  mentioned  in  the 
mortgage  is  worth  less  than  half  the  plaintiffs" 
debt,  and  the  defendant  is  now  insolvent. 
The  plaintiffs  sued  out  an  attachment,  which 
the  defendant  traversed. 

The  defendant's  conduct  is  attempted  to  be 
justiticd  on  two  grounds:  (1)  That  the  mort- 
gage on  the  cotton  was  void  for  uncertainty  in 
the  description;  and  (2)  that  the  note  and 
mortgage  wev^  procured  from  him  by  fraud, 
and  are  without  consideration. 

I'nder  the  act  of  February  11,  1875,  a  mort- 
gage on  crops  to  be  grown  is  valid,  and  the 
lien  attaches  when  the  -crop  is  produc(>d.  If 
it  be  conceded  that  the  description  of  the  cot- 
ton in  the  mortgage  is  too  uncertain  to  bind 
third  parties,  it  wac  undoubtedly  good  be- 
tween the  mortgagor  and  mortgagee.  Mc- 
Clure  V.  McDearm-  n,  26  Ark.  66;  Person  v. 
Wright,  35  Ark.  169.  But  the  description 
would  seem  to  be  sufficient  for  all  purposes. 
"That  hath  certainty  enougli  which  may  be 
made  certain."  The  description  is  "30  bales 
of  good  lint  cotton,  the  first  picking  of  our 
crop  of   1882,  to   average  450  pounds   each." 


There  is  no  diltitulty  here  in  identifying  the 
particular  bales  covered  by  the  mortgage; 
they  are  the  first  30  picked  and  baled  of  the 
mortgagor's  crop  of  1882.  Tliese  bales  were 
capal»le  of  identitication  by  the  fact  that  they 
were  the  first  baled  of  the  crop  of  that  3'ear; 
and  the  lien  of  the  mortgage  fastened  upon 
them  as  so(ui  as  the  process  of  baling  was 
completed.  Rol)inson  v.  Maudlin.  11  Ala.  977; 
Stearns  v.  Gafford.  of,  Ala.  544.  In  the  last 
case  cited  the  court  .say. 

"In  the  case  of  Hobin.son  v.  Maudlin,  11  Ala. 
977,  the  grantor,  who  was  a  planter,  was  in- 
debted to  his  conuuission  merchants,  and,  to 
secure  them,  conveyed  to  a  trustee  by  trust 
deed  '50,000  pounds  of  the  first  picking  of  the 
crop  of  1842.  then  growing  on  his  plaiuation, 
to  be  neatly  ginned  and  packed  in  bales,  ready 
for  market;  an('  upon  the  failure  of  the  plant- 
er to  pay  the  note  at  maturity,  the  trustee 
was  authorized  to  take  said  5<J,OiiO  pounds  of 
cotton  and  shij)  the  same  to  the  commission 
merchants,  to  be  .sold  for  the  payment  of  the 
note,'  etc.  The  question  was  whether  the 
trust  deed  conveyed  the  title  of  the  cotton,  so 
as  to  place  it  beyond  the  lien  of  an  execution. 
It  was  decided  that  it  did;  the  court  holding 
tliat  the  terms  'first  cotton  which  may  be 
gathered.'  means  of  the  early,  in  contradis- 
tinction to  the  'ate,  gathering;  and.  therefore, 
when  91  bales  of  the  early  gathering  were 
ginned  and  baled,  the  Ten  attached,  although 
there  was  then  in  the  crude  state  a  quantitj' 
of  cotton,  not  separated  from  t'ue  seed,  gath- 
ered earlier  in  the  season  than  that  which 
composed  the  91  bales.  The  proof  in  this 
case  tends  to  show  that  the  cotton  in  contro- 
versy may  justly  be  classed  as  'of  the  first 
cotton  that  may  be  gathered.'  under  the  rul- 
ing in  the  case  froiu  which  we  have  quoted." 

On  this  question  the  case  of  Person  v. 
Wright,  supra,  is  not  in  point.  In  that  case 
the  description  was  an  interest  in  the  mort- 
gagor's crop  "to  the  extent  of  one  5tKi-pound 
bale."  No  clue  was  given  by  which  the  bale 
could  1)0  identified  and  the  court  properly 
held  that  "until  separation  or  designation  of 
the  particular  property,  no  action  of  replevin 
could  be  maintained." 

The  defendant  has  failed  utterly  to  show 
fraud  or  want  of  consideration.  The  e\i;ienee 
establishes,  beyond  controversy,  that  the  note 
and  mortgage  were  given  for  a  full  and  valu- 
able consideration.  Upon  the  proofs  it  is  clear 
that  the  defendant  disposed  of  his  property, 
the  cotton  particularly  tc  hinder  and  delay 
the  plaintiff's  in  tne  collection  of  their  debt. 
The  defendant  does  not  feel  that  he  was 
guilty  of  any  moral  fraud.  He  justifies  his 
act  to  his  own  conscience  upon  grounds  which 
the  court  finds  either  had  no  existence  in  fact, 
or  constitute  no  legal  justification.  Wliatever 
his  motive  may  have  been,  it  is  clear  he  in- 
tended, by  the  disposition  he  made  of  his 
property,  to  hinder  and  delay  his  creditors  in 
the  collection  of  their  debt.  This  finding  sup- 
ports the  attachment. 


KXISTJCXCE  OF  THING  SOLD. 


The  defendant  has  been  suiiiinoned  and  ex- 
amined nnder  .seetic  n  415  of  (iantt's  Digest. 
That  section  reads  as  follows: 

"See.  415.  When  it  appears  by  the  allida- 
vit  of  the  plaintiff,  or  by  the  return  of  an 
officer  to  an  order  of  attachment,  that  no 
property  is  known  to  the  plaintiff  or  the  otti- 
cer  on  which  the  order  of  attachment  can  be 
execntcd.  or  not  enoui^h  to  satisfy  the  plain- 
tiff's claim,  the  def«'ndant  may  be  required 
by  the  court  to  attend  before  it,  and  s've  in- 
formation on  oath  respecting  his  property; 
and  where  it  also  appears  by  tlie  attidavit  of 
the  plaintiff  tliat  some  person  other  than  the 
defendant  has  in  his  possession  property  of 
the  defendant,  or  evidences  of  debt,  such  per- 
son may  also  be  required  by  the  court  to  at 
tend  before  it.  and  ijive  information  on  oath 
respectin.ir  the  same." 

He  admits  that  he  has  in  his  possession 
and  control  the  proceeds  of  the  sale  of  The  30 
bales  of  cotton,  amounting  to  ifSOO.  The 
plaintiffs  have  filed  a  motion  for  a  rule  on 
the  defendant  to  pay  this  money  to  the  mar- 
shal or  into  the  registry  of  the  court.  Tliis 
motion  is  resisted  on  the  ground  that  the 
court  has  no  poAver  or  jurisdiction  to  make 
such  an  order. 

It  is  vain  for  the  statute  to  provide  that 
the  defendant  may  be  required  to  attend  be- 
fore the  court,  "and  give  information  on  oath 
respecting  his  property,"  if  after  giving  such 
information  the  court  is  powerless  to  act 
upon  it,  and  require  the  defendant  to  do  what 
is  plainly  and  obviously  his  legal  duty.  The 
;!Uthority  to  compel  the  discovery  necessari- 
ly implies  the  power  to  render  the  discovery 
effectual.  It  is  a  settled  canon  of  construc- 
tion that  what  is  implied  in  a  statute  is  as 
iinich  a  part  of  it  as  what  is  expressed. 

Suppose  a  defendant  to  answer  that  he  has 
10  horses  concealed  within  the  .iurisdiction 
of  the  court,  and  refuses  to  give  informa- 
tion which  will  enal)le  an  officer  to  find  them. 
May  he  not  be  committed  until  he  does  do 
so?  Tnless  the  court  has  this  power,  the 
statute  is  nugatory.  ;Money  is  property,  and 
in  proceedings  under  this  section  there  is  no 
distinction  between  it  and  other  kinds  of 
property.  The  poi)ular  notion  that  a  debtor 
can  put  his  money  in  his  pocket  and  admit 
that  it  is  there  and  continue  to  defy  his 
creditors,  is  not  the  law  in  this  state.  In 
cases  of  attachment  he  can  be  reached  by 
proceedings  nnder  section  415,  and  after 
judgment  he  can  be  reached  by  proceedings 
had  under  sections  2713-2717.  Where  the 
discovery  is  made  after  judgment,  section 
2717  provides  that— 

"The  court  shall  enforce  the  surrender  of 
the  money  or  security  therefor,  or  of  any 
other  property  of  the  defendant  in  tne  exe- 
fution  which  may  be  discovered  in  the  ac- 
tion, and  for  this  pxirpose  may  commit  to 
jail  any  defendant  or  garnishee  failing  or  re- 
fusing to  make  such  stirrender,  until  it  shall 
be  done,  or  the  court  is  satisfied  that  it  Is  out 
of  his  power  to  do  so." 


Tlie  court  possesses  the  like  powers  Avhen 
the  discovery  is  made  by  an  examination  had 
mider  section  415.  The  proceedings  in  both 
instances  are  analogous  to  the  recognized 
practice  in  chancery  cases  and  in  bank- 
ruptcy. 

The  sacredness  of  the  defiMidaufs  person 
is  not  violated,  nor  is  he  imprisoned  for  debt. 
He  is  simply  required  to  do  that  which,  up- 
on his  own  admission  under  oath,  it  is  his 
legal  duty  to  do,  and  which  he  admits  ir  is  in 
his  power  to  do.  When  committed  for  re- 
fusing to  obey  siich  an  order,  it  is  in  no  sense 
a  commitment  for  debt.  It  is  a  commlrment 
as  a  punishment  for  contempt  in  refusing  to 
obey  a  valid  oi'der  of  the  court.  The  juris- 
diction to  commit  for  such  cause  is  inherent 
in  every  court,  whether  of  law  or  equity. 
To  say  that  a  defendant  in  an  attachment, 
W'ho  admits  on  his  examination  on  oath  that 
he  has  in  his  possession  and  control  money 
or  other  property  liable  to  seizure  to  satisfy 
the  writ,  cannot  be  required  to  place  such 
means  within  the  grasp  of  the  law,  or  that 
obedience  to  stich  an  order  may  not  be  en- 
forced by  the  tisual  methods  by  which  courts 
enforce  obedience  to  their  lawful  commands, 
is  to  grant  an  immunity  to  dishonest  aebtors, 
as  shocking  to  our  sense  of  jtistice  as  was 
the  imprisonment  of  honest  men  for  not  pay- 
ing debts  which  they  had  no  means  to  pay. 

Imprisonment  for  debt  is  abolished,  but  the 
laws  atithorizing  the  seizure  of  the  debtor's 
property  and  its  application  to  the  payment 
of  his  debts  remain,  as  do  the  old  as  well 
as  the  new  remedies  given  to  creditors  to 
discover  property  for  this  pttrpose.  The  ex- 
amination of  the  defendant  in  attachment  is 
to  effectuate  this  object,  and  for  no  other  pur- 
pose. Btit  the  constitution  of  this  state  does 
not  exempt  from  imprisonment  for  debt  "in 
cases  of  fraud."  Article  2.  §  10.  Const.  It 
woidd  be  difficult  to  imagine  a  clearer  case 
of  fraud  than  for  a  debtor  to  admit  under 
oath  that  he  had  money  and  property  to  pay 
his  debts,  and  at  the  same  time  refuse  to  sur- 
render it  for  that  purpose. 

Suitors  in  this  court  are  entitled  to  have 
enforced  in  their  favor  all  the  remedies  stip- 
plementary  to  and  in  aid  of  writs  of  aftach- 
ment  and  exectition  authorized  by  the  state 
law.  and  the  proceedings  for  that  piu-pnse 
may  be  at  law  or  in  equity,  according  as  the 
state  statiite  provides. 

The  case  of  Ex  parte  Boyd.  105  U.  S.  647, 
arose  under  an  analogotis  statute  in  the  statb. 
of  New  York.  In  that  case.  Boyd,  against 
whom  an  execution  had  been  issued,  was  or- 
dered to  submit  to  an  examination  before  a 
commissioner  of  the  court  concerning  his 
property.  He  refused  to  take  an  oath  to  tes- 
tify under  said  order,  whereupon  he  was  at- 
tached and  committed  for  contempt  by  the 
circuit  cotirt.  He  thereupon  tiled  in  the  su- 
preme court  of  the  United  States  a  petition 
for  a  writ  of  habeas  corpus,  which,  upon  a 
very  fidl  consideration  of  the  ease,  was  de- 
nied. 


EXISTENCE  OF  THIN(J  SOLD. 


93 


Tho  followiuK  extract  from  the  oinniou 
shows  that  the  examination  of  a  debtor  with 
the  view  to  the  discoveiT  of  assets  is  not  a 
novel  or  unusual,  nor  necessarily  an  equita- 
ble, proceediuir: 

"There  is  certainly  uotliiu^  in  the  nature 
of  an  examination  of  a  judgment  debtor,  up- 
on the  question  as  to  his  title  to  and  posseR- 
sion  of  property  applicaljle  to  the  payment 
of  a  judfimeut  against  him,  and  of  the  fact 
and  particulars  of  any  disposition  he  may 
have  made  of  it,  wliich  would  render  it  in- 
appropriate as  a  proceeding  at  law,  under 
the  orders  of  the  court,  where  the  record  of 
the  judgment  remains,  and  from  which  the 
execution  issues.  Such  examinations  are  fa 
miliar  features  of  every  system  of  insolvent 
and  banknipt  laws,  the  administration  of 
which  belongs  to  special  tribunals,  and  forms 
no  iiocessai7/  part  of  the  jurisdiction  in  Equi- 


ty. It  is  a  mere  matter  of  procedure,  not 
involving  tlie  substance  of  any  equitable 
right,  and  may  be  located  by  legi.slative  au- 
tliority  to  meet  the  requirements  of  judicial 
convenience.  Whatever  logical  or  liistorical 
distinctions  separate  tlie  juri.sdictions  of  eq- 
uity and  law.  and  with  whatever  effect  these 
distinctions  may  be  supposed  to  be  recog- 
nized in  the  constitution,  we  are  not  of  opin- 
ion that  the  proceeding  in  question  partakes 
so  exclusively  of  the  nature  of  either  tnal  it 
may  not  be  authorized.  indilTerently,  as  an 
instrument  of  justice  in  the  hands  of  courts 
of  whatever  description." 

An  order  will  be  entered  requiring  the  de- 
fendant to  pay  into  the  registry  of  the  court, 
within  10  days  after  service  of  the  order,  the 
$800  cash  which  he  admits  he  has  in  his  pos 
session  and  control,  to  abide  the  further  or- 
der of  the  court  in  the  premises. 


'.)4 


EXISTENCE  OF  THING  SOLD. 


HULL  V.   HULL. 
(48   Conn.    2ijO.) 

Sniirt'ino  Court  of  Connecticut.    June  Tcrni, 

ISSO. 

W.  K.  Towiisend  and  J.  H.  Whiting,  in  sup- 
jiort  of  the  motions.      II.  P>.  Minison,  contra. 

LOOM  IS,  J.  The  controversy  in  this  case 
has  reference  to  the  owner.shiit  of  six  colts, 
tlie  projjjeny  of  two  brood  mares,  which  the 
plaintiff,  some  ten  years  prior  to  this  suit,  pm'- 
chased  iu  Boston  of  the  liev.  William  II.  II. 
Murray.  The  contract  of  sak'  provided  that 
the  plaintiff  mijiht  take  the  mares  to  Murray's 
farm,  in  this  state,  of  which  she  was  and  had 
been  for  several  years  the  superintendent,  and 
there  keep  them  as  breeding  mares;  and  all 
the  colts  thereafter  foaled  from  them,  though 
sired  by  Murray's  stallions,  were  to  be  the  ex- 
clusive property  of  the  plaintiff.  No  attempt 
has  been  made  by  Murray's  creditors  or  his 
trustee  to  deprive  the  plaintiff  of  the  mares  so 
purchased,  and  they  are  now  in  her  undisturb- 
ed possession;  but  the  colts,  while  on  Murray's 
farm,  on  the  1st  of  August,  1879,  were  at- 
tached by  one  of  his  creditors,  who  su1)se- 
(piently  released  the  property  to  the  defend- 
ant as  trustee  iu  insolvency,  who  had  the  prop- 
erty iu  his  possession  at  the  time  the  plaintiff 
lirought  her  writ  of  replevin.  Tlie  sole  ground 
upon  which  the  defendant  claims  to  hold  these 
colts  is  that  there  was  such  a  retention  of  pos- 
session by  Murray  after  the  sale  as  to  render 
the  tiansaction  constructivelj'  fraudulent  as 
against  creditors. 

The  court  below  overruled  this  claim,  and  in 
so  doing  we  think  committed  no  error.  The 
doc-trine  as  to  retention  of  possession  after  a 
sale  has  no  application  to  the  facts  of  this 
case.  A  vendor  cannot  retain  after  a  sale 
what  does  not  then  exist,  nor  that  which  is 
already  in  the  possession  of  the  vendee.  This 
proposition  wotild  seem  to  be  self-sustaining. 
If,  however,  it  needs  confirmation,  the  authori- 
ties in  this  state  and  elsewhere  abundantly 
supply  it.  Lucas  v.  Birdsey,  41  Conn.  3.37; 
Capron  v.  Porter.  43  Conn.  389;  Spiing  v. 
Chipman,  G  Vt.  (562.  In  Bellows  v.  AY  ells,  30 
Vt.  .yj9,  it  was  held  that  a  lessee  might  con- 
vey to  his  lessor  all  the  crops  which  might 
be  grown  on  the  leased  land  during  the  term, 
and  no  delivery  of  the  crops  after  they  were 
han-ested  was  necessary  even  as  against  at- 
taching creditors,  and  that  tlie  doctrine  as  to 
retention  of  ixjssession  after  the  sale  did  not 
api)ly  to  property  which  at  the  time  of  the 
sale  was  not  subject  to  attachment  and  had 
no  real  existence  as  property  at  all. 

The  case  at  bar  is  within  the  principle  of 
the  above  authorities,  for  it  is  very  clear  that 
the  title  to  the  property  in  (piestiou  when  it 
first  came  into  existence  was  in  the  plaintiff. 
In  reaching  this  conclusion  it  is  not  necessary 
to  hold  that  the  mares  became  the  absolute 
property  of  the  plaintiff  imder  Mas-sachusetts 
law   Avithout  a   more  substantial  and   visible 


change  of  possession,  or  that  imder  our  law. 
the  title  to  the  mares  being  in  the  plaintiff 
clearly  as  between  the  parties,  the  rule  import- 
ed from  the  civil  law,  partus  sequitur  ven- 
tnnn,  applies.  We  waive  the  consideration  of 
these  (piestions.  It  will  sutlice  that,  by  the 
express  terms  of  the  contract,  the  plaintiff  was 
to  have  as  her  own  all  the  colts  that  might  be 
bora  from  these  mares.  That  the  law  will 
sanction  such  a  contract  is  very  clear.  It  is 
true,  as  remarked  in  Perkins,  Conv.  tit. 
"(Jrant,"  §  05,  that  "it  is  a  common  learning 
in  the  law  that  a  man  cannot  grant  or  charge 
that  which  he  has  not";  yet  it  is  equally  well 
settled  that  a  future  possibility  arising  out  of, 
or  dependent  upon,  some  present  right,  prop- 
erty or  interest,  may  be  the  subject  of  a  valid 
present  sale.  The  distinction  is  illustrated  in 
Hobart,  132.  as  follows:  "The  grant  of  all 
the  tithe  wool  of  a  certain  year  is  good  in  its 
creation,  though  it  may  happen  that  there  be 
no  tithe  avooI  in  that  year;  but  the  grant  of 
the  wool  which  shall  grow  upon  such  sheep 
as  the  grantor  may  afterwards  purchase,  is 
void."  It  is  well  settled  that  a  valid  sale  may 
be  made  of  the  wine  a  vineyard  is  expected  to 
produce,  the  grain  that  a  tield  is  expected  to 
grow,  the  milk  that  a  cow  may  yield,  or  the 
future  young  born  of  an  animal.  1  Pars.  Cont. 
(.jth  Ed.)  p.  023,  note  k,  and  cases  there  cited; 
Hill.  Sales,  §  38;  Story,  Sales,  §  ISO.  In  Fon- 
Aille  V.  Casey,  1  Murph.  (N.  C.)  389,  it  was 
held  that  an  agreement  for  a  valuable  consid- 
ei'ation  to  deliver  to  the  plaintiff  the  first  fe- 
male colt  which  a  certain  mare  owned  by  the 
defendant  might  produce,  vests  a  property  in 
the  colt  in  the  plaintiff,  upon  the  principle 
that  there  may  be  a  valid  sale  where  the  titje 
is  not  actually  in  the  grantor,  if  it  is  in  him 
potentially,  as  being  a  thing  accessory  to  some- 
thing which  he  actually  has.  And  in  ^NlcCarty 
V.  Blevius,  5  Yerg.  19.j,  it  was  held  that  where 
A.  agrees  with  B.  that  the  foal  of  A.'s  mare 
shall  belong  to  C,  a  good  title  vests  in  the 
latter  when  parturition  from  the  mother  takes 
place,  though  A.  Immediately  after  the  colt 
was  born  sold  and  delivered  it  to  D. 

Before  resting  the  discussion  as  to  the  plain- 
tiff's title,  we  ought  perhaps  briefly  to  allude 
to  a  claim  made  by  the  defendant,  both  in 
the  court  belcjw  and  in  this  court,  to  the  ef- 
fect that  if  the  plaintiff's  title  be  conceded 
slie  is  estopped  from  asserting  her  claim.  This 
doctrine  of  estoppel,  as  all  triei's  nmst  have 
observed,  is  often  strangely  misapplied.  And 
it  is  surely  so  iu  this  instance.  The  case  fails 
to  show  any  act  or  omission  on  the  part  of  the 
plaintiff  inconsistent  with  the  claims  she  now 
makes,  or  that  the  creditors  of  Murray  or  the 
defendant  as  representing  them  were  ever  mis- 
led to  their  injury  by  any  act  or  negligence  on 
her  part.  On  the  contrary  the  estoppel  is  as- 
serted iu  the  face  of  the  explicit  finding,  that 
"as  soon  as  the  plaintiff  became  aware  of  the 
attachment  of  her  horses  she  forbade  the  of- 
ficer taking  the  same,  and  demanded  their  im- 
mediate I'eturn  to  hej-."  The  only  fact  which 
is  suggested  as  furnishing  the  basis  for  the 


EXISTENCE  OF  THINd  SOLD. 


95 


alleged  estoppel  is  that  from  the  1st  of  Au- 
gust, IST'J,  to  the  I2th  of  Jauuai-j-  next  follow- 
iug,  "no  attempt  was  made  by  the  plaiutift" 
to  maintain  her  title  by  suit,  although  she  was 
living  during  the  time  at  Guilford,  where  said 
colts  were."  But  who  ever  heard  of  an  estop- 
pel in  an  action  at  law  predicated  solely  on 
neglect  to  bring  a:  suit  for  the  period  of  five 
mouihsV  To  recognize  such  a  thing  for  anj' 
period  short  of  the  statute  of  limitations  Avould 
practically  modify  the  statute  and  create  a 
new  limitation.  Furthermore,  in  what  respect 
have  the  defendant  and  those  he  represents 
been  misled  to  their  injury  by  this  fact?  The 
plaintiff  never  induced  the  taking  or  with- 
holding of  her  property.  And  can  a  tort  feas- 
or or  the  wrongful  possessor  of  another's  prop- 
erty object  to  the  delay  in  suing  him  for  his 
wrong,  and  claim,  as  in  this  case,  an  estoppel 
on  the  ground  that  his  wrongful  ix)ssession 
proved  a  very  expensive  one  to  him,  amount- 
ing even  to  more  than  the  value  of  the  prop- 


erty? He  might  have  stopped  the  expense  at 
any  time  by  simply  giving  to  the  plaintiff 
what  belonged  to  her. 

The  single  (luestion  of  evidence  which  the 
record  presents  we  do  not  deem  it  necessary 
particularly  to  discuss.  It  will  suffice  to  re- 
mark that  if  the  defendant's  testimony  was  ad- 
missible to  show  that  Munay,  after  the  sale 
to  the  plaintiff'  (and,  so  far  as  ai)pears.  in  her 
absence),  claimed  to  own  the  mares  and  colts, 
it  was  a  complete  and  satisfactory  reply  for 
the  plaintiff  in  rebuttal  to  show  that  Murray's 
own  entries  (presumably  a  part  of  the  res  ges- 
ivo)  in  the  appropriate  books  kept  by  him, 
showed  the  fact  to  be  otherwise,  and  in  ac- 
cordance with  the  plaintiff's  chiims.  At  any 
rate  it  is  very  clear  that  no  injustice  was  done 
by  this  ruling  to  furnish  any  ground  for  a 
new  trial.  There  was  no  error  in  the  judg- 
ment complained  of,  and  a  new  trial  is  not 
advised.  In  this  opinion  the  other  judges  con- 
curred. 


96 


PRICE  I'AID. 


SAXBOUX  V.  SHIPHERD. 

(()0  N.  W.  1089,  59  Minn.  144.) 

Supremo  Court  of  Minnesota.      Nov.  16,  1894. 

Appeal  from  niuuicipal  court  of  Minneapo- 
lis;   Audrew  Holt,  Judse. 

Actiou  by  Colby  E.  Sanborn  aj?ainst  Ed- 
ward L.  Sliii)hord  to  recover  po.ssessiou  of 
certain  personal  property.  From  a  judg- 
ment for  plaintiff,  defendant  appeals.  Re- 
versed. 

W.  H.  Adams,  for  api)enant.  George  S. 
Grimes,  for  respondent. 

Mitchell,  J.  This  was  an  action  to 
recover  the  possession  of  certain  personal 
property  allej^ed  to  have  been  wrongfully 
detained  by  defendant.  The  undisputed  ev- 
idence is  that  the  parties  entered  into  a  con- 
tract for  the  sale  of  the  property  by  defend- 
ant to  plaintiff  for  ^200,  of  which  the  plain- 
tiff paid  ^2.50  at  the  date  of  the  contract, 
and  was  to  pay  the  balance  of  ^197.50  on 
the  evening  of  the  same  day;  that  upon  the 
return  of  plaintiff  he  demanded  the  deliv- 
ery of  the  property  without  paying  the  $197.- 
50,  on  the  ground  that  in  the  meantime  he 
had  been  garnished.  The  defendant  offered 
to  deliver  the  property  on  payment  of  the 
$197.50,  but  refused  to  do  so  without  it; 
hence  this  action.  The  $197. .50  never  has 
been  paid  or  tendered.  Nothing  was  said  in 
the  contract  of  sale  as  to  its  being  on  cred- 


it, and  there  v/as  nothing  from  which  a 
credit  could  be  implied.  There  may,  per- 
haps, be  some  conflict  of  evidence  as  to 
whether  defendant  was  himself  the  owner  or 
merely  the  agent  of  the  owner  of  the  proper- 
ty, having  charge  of  it  with  autliurity  to  sell; 
but  which  he  was  is  wholly  immaterial  in 
this  case.  How,  on  this  state  of  facts,  it 
could  be  found  that  plaintiff  was  entitled  to 
the  possession  of  the  property  we  are  whol- 
ly at  a  loss  to  conceive.  There  being  no 
agreement  of  the  parties  to  the  contr-iry,  the 
law  presumes  the  sale  to  have  been  for  cash; 
and,  upon  a  sale  for  cash,  payment  of  the 
purchase  money  and  the  delivery  of  the 
property  are  concurrent  and  mutually  de- 
pendent acts.  Neither  party  is  bound  to 
perform  without  contemporaneous  perform- 
ance by  the  other.  The  payment  of  the  pur- 
chase money  was  a  condition  precedent  to 
plaintiff's  right  of  possession.  The  fact  that 
some  third  party  had  attempted  to  garnish 
the  purchase  money  in  the  hands  of  the 
plaintiff  could  not  alter  the  contract  of  the 
parties.  We  do  not  mean  to  be  imderstood 
as  intimating  that,  in  the  case  of  an  execu- 
tory contract  for  the  sale  of  personal  prop- 
erty, replevin  will  lie  where  the  purchase 
money  has  been  tendered,  but  refused.  But 
in  this  case  there  was  not  even  a  tender. 
Judgment  reversed  and  new  trial  ordered. 

GILFILLAN.  C.  J.,  absent  on  account  of 
sickness;    took  no  part. 


PRICE  PAID. 


07 


KOUXTZ  V.  KIIiKPATKICK  ft  al. 

(72  Pii.  St.  37(5.) 

8ui)n'mo  Court  of  Pcnii.sylvaniii.      Jan.  G,  1873. 

Assumpsit  by  Josepli  Kiikpatric-k  aud  Jaiiit's 
Lyous,  tradin;;  as  Kiikpatrick  lic  Lyous,  to  the 
use  of  Frederick  Fislier  and  otiiers,  trading 
as  Fisher  Bros.,  agaiust  William  J.  Kountz, 
i'uv  failure  to  deliver  a  cei-tain  Quantity  of 
crude  petroleuui,  wheu  called  upou  to  do  so 
December  31,  istji),  in  compliance  with  his  con 
tract  previously  made.  Judgment  for  plain- 
tiffs, aud  defeudant  brings  error.      Ue versed. 

Before  THOMPSON,  C.  J.,  and  HEAD,  AG- 
NEW,  SHAHS  WOOD,  and  WILLIAMS,  J. 

S.  H.  Geyer  and  G.  Shiras,  Jr.,  for  plaintiff 
in  error.  M.  W.  Acheson.  for  defendants  in 
error. 

AGXEW.  J.  The  second,  third,  tifth,  sixth, 
seventh,  eighth,  eleventh,  twelfth,  thirteenth, 
fourteenth,  tifteeuth  and  sixteenth  errors  are 
not  well  assigued.  for  all  the  answers  of  the 
court  to  the  points  were  omitted.  When  a 
court  simply  refuses  a  point,  the  error  is  well 
assigued  by  recitiug  the  point,  aud  stating 
that  it  was  refused.  But  wheu  the  judge  an- 
swers specially,  in  order  to  introduce  a  quali- 
ticatiou  he  deems  necessary  to  make  his  in- 
structiou  correct,  the  answer  must  be  recited 
as  well  as  the  point.  We  shall  not  decline 
considering,  however,  all  the  important  ques- 
tions; and  in  order  to  discuss  them,  we  may 
state  succinctly  the  nature  of  the  case.  On 
the  7th  of  June,  l8{i'J,  Kountz  sold  to  Kirk- 
patrick  &  Lyons,  two  thousand  barrels  of  crude 
petroleum,  to  be  delivered  at  his  option,  at 
any  time  from  the  date,  until  the  3 1st  of  De- 
cen)bei,  ISGU.  for  cash  on  delivery,  at  thirteen 
aud  a  half  cents  a  gallon.  On  the  24th  of 
June,  1869,  Kirkpatrick  &  Lyons  assigned 
this  contract  to  Fisher  &.  Brothers.  Kountz 
failed  to  deliver  the  oil.  He  defeuds  on  the 
ground  that  Kirkpatrick  &  Lyons,  aud  others 
holding  like  contracts  for  delivery  of  oil,  en- 
tered into  a  combination  to  raise  the  price,  by 
buying  up  large  quantities  of  oil,  aud  holding 
it  till  the  expiration  of  the  year  18(i9,  and 
thus  to  compel  the  sellers  of  oil  on  option  con- 
tracts, to  pay  a  heavy  (liff.?rence  for  non  deliv- 
ery. Fisher  &  Brothers,  the  assignees  of 
Kountz's  contract,  were  not  in  the  combina- 
tion, and  the  principal  questions  are  whether 
they  are  affected  by  the  acts  of  Kirkpatrick  & 
liyons,  subseijuent  to  the  assignment;  wheth- 
er notice  of  the  assigumeut  to  Kountz  was 
neces.sary  to  protect  them,  and  what  is  the 
true  measure  of  damages.  The  com-t  below 
held  that  Fisher  &  Brothers,  as  assignees  of 
the  contract,  were  not  affected  by  the  acts  of 
Kirkpatrick  &  Lyons,  as  members  of  the  com- 
bination in  the  following  October  and  sub.se- 
(pieutly,  and  that  notice  iu  this  case  was  not 
essential  to  the  protection  of  Kountz. 

The  common-law  rule  as  to  the  a.ssiguabil- 
ity  of  choses  iu  action  no  louger  prevails,  but 
in  equity  the  assignee  is  looked  upon  as  the 
true  owner  of  the  chose.     He  may  set  off  the 

VAN  ZILE  SEL. CAS. SALES — 7 


demand  as  his  own:  Morgan  v.  Bank,  8  Serg. 
&  R.  73;  Hani.sey's  Appeal,  2  Watts,  228. 
The  assignee  takes  the  chose  subject  to  the 
existing  ecpiities  between  the  original  parties 
before  assignment,  aud  also  to  payment  and 
other  defences  to  the  iu.strument  its«'lf,  after 
the  assignment  and  before  notice  of  it;  but  he 
cannot  be  affected  by  collateral  transactions, 
secret  tnists,  or  acts  unconnected  with  the 
sul)ject  of  the  contract:  Davis  v.  Barr.  !)  Serg. 
&  H.  137;  Beckley  v.  Eckert,  3  Pa.  St.  292; 
Mott  V.  Clark,  9  Pa.  St.  399;  Taylor  v.  (iitt, 
10  Pa.  St.  428;  Bank  v.  Balliet,  8  Watts  &  S. 
318;  Corser  v.  Craig,  1  Wash.  C.  C.  424,  Fed. 
Cas.  No.  3.2.">.");  1  Pais.  Cont.  193,  IIMJ;  2 
Story,  Cont.  S  ;{9(i.  note. 

The  act  of  Kirkpatrick  &  Lyons,  conqilained 
of  as  members  of  an  unlawful  cou)bination  to 
raise  the  price  of  oil,  was  long  sub.-equeut  to 
their  assignment  of  Kountz's  c<;nlract,  aud 
was  a  mere  tort.  The  contract  was  affected 
only  by  its  results  as  an  independent  act.  It 
does  not  seem  just,  therefore,  to  visit  this  ef- 
fect upon  Fisher  &  Brothei-s,  the  antecedent 
assignees.  The  act  is  wholly  collateral  to  the 
ownership  of  the  chose  itself,  and  there  is 
nothiug  to  link  it  to  the  chose,  so  as  to  liind 
the  assignors  and  assignees  together.  After 
the  assignment,  there  b»>ing  no  guaranty,  the 
assignors  had  no  interest  in  the  performance 
of  this  particular  contract,  and  no  motive, 
therefore,  arising  out  of  it  to  raise  the  piice 
on  Kouutz.  The  acta  of  Kirkiiatrick  &  Ly- 
ons seem,  therefore,  to  have  no  greater  or  other 
bearing  ou  this  contract  than  the  acts  of  any 
other  members  of  the  combination,  who  were 
strangers  to  the  contract. 

In  regard  to  notice  of  the  assignment  to 
Kountz.  it  is  argued,  that  having  had  no  notice 
of  it.  if  he  knew  of  the  conspiracy  to  raise  the 
price  of  oil.  and  thus  to  affect  his  contract, 
and  that  Kirkpatrick  &  Lyons  were  parties  to 
it.  he  might  have  relied  on  mat  fact  as  a  de- 
fence, and  refu.sed  to  deliver  the  oil.  and  claim- 
ed on  the  trial  a  verdict  for  merely  nominal 
damages  for  his  breach  of  his  contract.  Pos- 
sibly in  such  a  special  case,  want  of  notice 
might  have  constituted  an  etjuity.  but  the  an- 
swer to  this  case  is,  that  no  such  point  w:is 
made  iu  the  court  below,  and  there  does  not 
seem  to  be  any  evidence  that  Kountz  knew 
of  the  conspiracy,  and  Kirkpatrick  &  Lyons's 
privity,  and  relying  on  these  facts,  desistt^d 
from  purchasing  oil  to  fullil  his  contract  with 
them.  As  the  case  stood  before  the  court  be- 
low, wt  discover  no  error  in  the  answers  of 
the  learned  judge  on  this  part  of  it. 

The  n(»xt  «^uestion  is  upon  the  proper  meas- 
ure of  damages.  In  the  sale  of  chattels,  the 
general  rule  is,  that  the  measure  is  the  differ- 
ence between  the  contract  price  and  the  mar- 
ket value  of  the  article  at  the  time  and  place 
of  delivery  under  the  contract.  It  is  unneces- 
sary to  cite  authority  for  this  well  established 
rule,  but  as  this  case  raises  a  novel  and  ex- 
traordinary question  between  the  true  market 
value  of  the  article,  and  a  stimulated  market 
price,  created  by  artificial  and  fraudulent  prac- 


98 


PRICE  PAID. 


tices.  It  is  necessary  to  fix  the  tnio  nieaning 
(  f  the  rule  itself,  before  we  eau  approach  the 
real  (luestiou.  Ordinarily,  when  an  article  of 
.sale  is  in  tlie  market,  and  has  a  market  value, 
there  is  no  difference  between  its  value  and 
the  market  price,  and  the  law  adopts  the  lat- 
ter as  the  proijer  evidence  of  the  value.  This 
is  not,  however,  because  value  and  price  are 
really  convertible  terms,  but  only  because  they 
are  ordinarily  so  in  a  fair  market.  The  pri- 
mary meaning;  of  "value"  is  worth,  and  this 
worth  is  made  up  of  the  useful  or  estimable 
(lualities  of  the  thing:  See  Webster's  and 
Worcester's  Dictionaries.  "Price,"  on  the 
other  hand,  is  the  sum  in  money  or  other 
ecpiivalent  set  upon  an  article  by  a  seller, 
which  he  demands  for  it:  Id.  Value  and 
price  are,  therefore,  not  synouymes,  or  the 
nece-s^sary  equivaU'nts  of  each  otlier,  though 
conunouly,  market  value  and  market  price  are 
legal  equivalents.  When  we  examine  the  au- 
thorities, we  find  also  that  the  most  accurate 
^\•riters  use  tlie  phrase  market  value,  not  inar- 
ket  i)rice.  Mr.  Sedgwick,  in  his  standard  work 
on  the  ^Measure  of  Damages  (-tth  Ed.  p.  200) 
says:  "Where  contracts  for  the  value  of  chat- 
tels are  broken  by  the  vendors  failing  to  de- 
liver property  according  to  the  terms  of  the 
baigain.  it  seem.s  to  be  well  settled,  as  a  gen- 
eral rule,  both  in  England  and  the  United 
States,  that  the  measure  of  damages  is  the  dif- 
ference between  the  contract  price  and  the 
market  value  of  the  article  at  the  time  it 
should  be  delivered  upon  the  ground;  that  this 
is  the  plaintiff's  real  loss,  and  that  with  this 
sum,  he  can  go  into  the  market  and  supply 
himself  with  the  same  article  from  another 
vendor."  Judge  Rogers  uses  the  same  term 
in  Smethurst  v.  Wcolston,  5  Watts  &  S.  lO'J: 
"The  value  of  the  article  at  or  about  the  time 
it  is  to  be  delivered,  is  the  measure  of  dam- 
ages in  a  suit  by  the  vendee  against  the  ven- 
dor for  a  breach  of  the  contract."  So  said  C. 
J.  Tilghman.  in  Girard  v.  Taggart.  5  Serg.  & 
R.  32.  Judge  Sergeant,  also,  in  O'Conner  v. 
Forster,  10  Watts,  422,  and  in  Mott  v.  Dan- 
forth,  6  Watts,  308.  But  as  even  accurate 
writers  do  net  always  use  words  in  a  precise 
sense,  it  would  be  unsatisfactory  to  rely  on 
the  common  use  of  a  word  only,  in  making  a 
nice  distinction  between  terms.  It  is  tliere- 
fore  proper  to  inquire  into  the  true  legal  idea 
of  tlamages  in  order  to  determine  the  proper 
definition  of  the  term  value.  Except  in  those 
cases  where  oppression,  fraud,  malice  or  neg- 
ligence enter  into  the  question,  "the  declared 
object  (says  Mr.  Sedgwick,  in  his  work  on 
Damages)  is  to  give  compensation  to  the  party 
injured  for  the  actual  loss  sustained."  (-1th 
Ed.)  pages  2S,  20;  also,  pages  36,  37.  Among 
the  many  authorities  he  gives,  he  quotes  the 
language  of  C.  J.  Shippen,  in  Bussy  v.  Donald- 
son. 4  Da  11.  20G.  "As  to  the  assessment  of 
damages  (said  he),  it  is  a  rational  and  legal 
principle,  that  the  compensation  should  be 
equivalent  to  the  injury."  "The  rule,"  said 
C  J.  Gibson,  "is  to  give  actual  compensation, 
by  graduating  the  amount  of  the  damages  ex- 


actly to  the  extent  of  the  loss."  "The  meas- 
ure is  tlie  actual,  not  the  speculative  loss:"' 
For.syth  v.  Palmer,  14  Pa.  St.  97.  Thus,  com- 
pensation being  the  true  purpose  of  the  law, 
it  is  obvious  that  the  means  employed,  in  other 
words,  the  evidence  to  ascertain  compensation, 
must  be  such  as  tiiily  reaches  this  end. 

It  is  equally  obvious,  when  we  consider  its 
true  nature,  that  as  evidence,  the  market  price 
of  an  article  is  only  a  means  of  arriving  at 
compensation;  it  is  not  itself  the  value  of 
the  article,  but  is  the  evidence  of  value.  The 
law  adopts  it  as  a  natural  inference  of  fact, 
but  not  as  a  conclusive  legal  presumption.  It 
stands  as  a  criterion  of  value,  because  it  is  a 
common  test  of  the  ability  to  purchase  the 
thing.  But  to  assert  that  the  price  asked  in 
the  market  for  an  article  is  the  true  and  only 
test  of  value,  is  to  abandon  the  proper  object 
of  damages,  viz.,  compensation,  in  all  those 
cases  where  the  market  evidently  does  not  af- 
ford the  true  measure  of  value.  This  thought 
is  well  expressed  by  Lewis,  C.  J.,  in  Bank  v. 
Reese,  20  Pa.  St.  140.  "The  paramount  rale 
in  assessing  damages  (he  says),  is  that  every 
person  unjustly  deprived  of  his  rights,  should 
at  least  be  fully  compensated  for  the  injury  he 
sustained.  Where  articles  have  a  determinate 
value  and  an  unlimited  production,  the  gen- 
eral rule  is  to  give  their  value  at  the  time  the 
owner  was  deprived  of  them,  with  interest  to 
the  time  of  verdict.  This  rule  has  been  adopt- 
ed because  of  its  convenience,  and  because  it 
in  general  answers  the  object  of  the  law,, 
which  is  to  compensate  for  the  injury.  In 
relation  to  such  articles,  the  supply  usually 
keeps  pace  with  the  demand,  and  the  fluctua- 
tions in  the  value  are  so  inconsiderable  as  to 
justify  the  courts  in  disregarding  them  for 
the  sake  of  convenience  and  uniforniity.  In 
these  cases,  the  reason  whj'  the  value  at  the 
time  of  conversion,  with  interest,  generally 
reaches  the  justice  of  the  case,  is  that  when 
the  owner  is  deprived  of  the  articles,  he  may 
purchase  others  at  that  price.  But  it  is  mani- 
fest that  this  would  not  remunerate  him  where 
the  article  could  not  be  obtained  elsewhere,  or 
where  from  restrictions  on  its  production,  or 
other  cauvses,  its  price  is  necessarily  subject  to 
considerable  fluctuation."  This  shows  that 
the  market  price  is  not  an  invariable  standard, 
and  that  the  converse  of  the  case  then  before 
Judge  Lewis  is  equally  true — that  Is  to  say — 
when  the  market  price  is  unnaturally  inflated 
by  unlawful  and  fraudulent  practices,  it  can- 
not be  the  true  means  of  ascertaining  what  is 
just  compensation.  It  is  as  unjust  to  the 
seller  to  give  the  purchaser  more  tlian  just 
compensation,  as  it  is  to  the  purchaser  to  give 
him  less.  Right  upon  this  point,  we  have  the 
language  of  this  court  in  the  case  of  a  refusal 
by  a  purchaser  to  accept:  Andrews  v.  Hoo- 
ver, 8  Watts.  240.  It  is  said:  "The  juiy  is 
bound  by  a  measure  of  damages  where  there 
is  one,  but  not  always  by  a  particular  means 
for  its  ascertainment.  Now  the  measure  in  a 
case  like  the  present,  is  the  difference  between 
the  price  contracted  to  be  paid  and  the  value 


PRICE  PAID. 


99 


cf  the  thins  when  it  ought  to  have  been  ac- 
cepted; and  though  a  resale  is  a  couveuieut 
and  often  satisfactory  means,  it  does  not  fol- 
low that  it  is,  nor  was  it  said  in  Girard  v. 
Taggart,  to  be  the  only  one.  On  the  con- 
trary, the  propriety  of  the  direction  there  that 
the  jury  were  not  bound  by  it,  if  they  could 
find  another  more  in  accordance  with  the  jus- 
tice of  the  case,  seems  to  have  been  admitted; 
the  very  thing  complained  of  here."  Judge 
Strong  took  the  same  view  in  Trout  v.  Ken- 
nedy. 47  Pa.  St.  393.  That  was  the  rase  of 
a  trespasser,  and  the  jury  had  been  told  that 
the  plaintiff  was  entitled  to  the  just  and  full 
value  of  the  propeny.  and  if  at  the  time  of 
the  trespass  the  market  was  depressed,  too 
much  importance  was  not  to  be  given  to  that 
fact.  'Tf  (says  Judge  Strong)  at  any  particu- 
lar time,  there  be  no  market  demand  for  an 
article,  it  is  not  of  course  on  that  account  of 
no  value.  What  a  thing  will  bring  in  the 
market  at  a  given  time,  is  perhaps  the  meas- 
ure of  its  value  then;  but  it  is  not  the  only 
one.""  These  cases  plainly  teach  that  value 
and  market  price  are  not  always  convertible 
terms;  and  certainly  there  can  be  no  differ- 
ence in  justice  or  law,  in  an  unnatural  de- 
pression and  an  unnatural  exaltation  in  the 
market  price — neither  is  the  true  and  only 
measure  of  value. 

These  general  principles  in  the  doctrine  of 
damages  and  authorities,  prove  that  an  in- 
flated speculative  market  price,  not  the  result 
of  natural  causes,  but  of  artificial  means  to 
stimulate  prices  by  unlawful  combinations 
for  the  purposes  of  gain,  cannot  be  a  legiti- 
mate means  of  estimating  just  compensation. 
It  gives  to  the  purchaser  more  than  he  ought 
to  have,  and  compels  the  seller  to  pay  more 
than  he  ought  to  give,  and  it  is  therefore  not 
a  just  criterion.  There  is  a  case  in  our  own 
state,  bearing  strongly  on  this  point:  Blyden- 
burgh  V.  "Welsh.  Baldw.  331.  Fed.  Cas.  No. 
1.583.  Judge  Baldwin  had  charged  the  jury  in 
these  words:  "If  you  are  satisfied  from  the 
evidence,  that  there  was  on  that  day  a  tixetl 
price  in  the  market,  you  must  be  governed  by 
it;  if  the  evidence  is  doubtful  as  to  the  price, 
and  witnesses  vary  in  their  statements,  you 
must  adopt  that  which  you  think  best  accords 
with  the  proof  in  the  case."'  In  granting  a 
new  trial.  Judge  Hopkinson  said:  'Tt  is  the 
price — the  market  price — of  the  article  that  is 
to  furuish  the  measure  of  damages.  Now 
what  is  the  price  of  a  thing,  particularly  the 
market  price  V  We  consider  it  to  l>e  the  value, 
the  rate  at  which  the  thing  is  sold.  To  make 
a  market,  there  must  be  buying  and  selling, 
purchase  and  sale.  If  the  owner  of  au  article 
holds  it  at  a  price  which  nobody  will  give  for 
it,  can  that  be  said  to  be  its  market  value"/ 
Men  sometimes  put  fantastical  prices  upon 
their  property.  For  reasons  personal  and  pe- 
culiar, they  may  rate  it  unich  above  what 
any  one  would  give  for  it.  Is  that  the  value"/ 
Further,  the  holders  of  an  article,  flour,  for 
instance,  under  a  false  rumor,  which,  if  true, 
would  augment  its  value,  may  suspend  their 


sales  or  put  a  price  upon  it.  not  according  to 
its  value  in  the  actual  state  of  the  market,  but 
accoi-ding  to  what  in  their  opinion  will  be  its 
market  price  or  value,  provided  the  rumor 
shall  prove  to  be  true.  In  such  a  case,  it  is 
clear,  that  the  asking  price  is  not  the  worth 
of  the  thing  on  the  given  day,  but  what  it  is 
supposed  it  will  be  worth  at  a  future  day.  if 
the  contingency  shall  happen  which  is  to  give 
it  this  additidual  value.  To  take  such  a  price 
as  the  rule  of  damages,  is  to  make  the  defend- 
ant pay  what  in  truth  never  was  the  value 
of  the  article,  and  to  give  to  the  plaintiff  a 
profit  by  a  breach  of  the  contract,  which  he 
never  would  have  made  by  its  performance." 

The  case  of  suspended  sales  uik»u  a  rumor 
tending  to  enhance  the  price,  put  Ity  Judge 
Hopkinson.  bears  no  comparison  to  the  case 
alleged  here,  where  a  cumbinatiou  is  inten- 
tionally formed  to  buy  up  oil.  hold  it  till  the 
year  is  out,  and  thus  force  the  market  ju-ice 
up  purposely  to  afff^ct  existing  contracts,  and 
c-ompel  the  sellers  to  pay  heavy  damages  for 
nonfulfillment  of  their  bargains.  In  the  same 
case.  Judge  Hopkinson  further  said:  "We 
did  not  intend  that  they  (the  juryi  should  go 
out  of  the  limits  of  the  market  price,  nor  to 
take  as  that  price  whatever  the  holders  of  the 
coffee  might  choose  to  ask  for  it;  substituting 
a  fictitious,  unreal  value,  which  nobody  would 
give,  for  that  at  which  the  article  might  l>e 
bought  or  sold."'  "in  determining.""  says  au 
eminent  writer  on  contracts,  "what  is  the 
market  value  of  proi>erty  at  any  particular 
time,  the  jury  may  sometimes  take  a  wide 
range;  for  this  is  not  always  ascertainable 
by  precise  facts,  but  must  sometimes  rest  on 
opinion;  and  it  would  seem  that  neither  party 
ought  to  gain  or  lose  by  a  mere  fancy  price, 
or  an  inflated  and  accidental  value,  suddenly 
put  in  force  by  some  speculative  movement, 
and  as  suddenly  passing  away.  The  (luestinu 
of  damages  by  a  market  value  is  peculiarly 
one  for  a  jury."  2  Pars.  Cont.  (Ed.  lS57i  p. 
4S2.  In  Smith  v.  Ciritfith.  3  Hill,  337.  33S.  C. 
J.  Nelson  said:  "I  admit  that  a  mere  speiula- 
tive  price  of  the  article,  got  up  by  the  con- 
trivance of  a  few  interested  dealers,  is  not 
the  true  test.  The  law.  in  regulating  the 
measure  of  damages.  contemi)lafes  a  range  of 
the  entire  market,  and  the  average  of  prices, 
as  thus  foimd.  running  through  a  reasonable 
periwl  of  time.  Neither  a  sudden  and  tran- 
sient inflation,  nor  a  depri'ssion  of  prices, 
should  control  the  question.  These  are  often 
accidental,  promoted  by  interested  and  ille- 
gitimate combinations,  for  temporary,  special 
and  selfish  objects,  independent  of  the  oli- 
jects  of  lawful  commerce;  a  forced  and  vio- 
lent perversion  of  the  laws  of  trade,  not  with- 
in the  contemplation  of  the  regular  dealer, 
aud  not  dest-rving  to  be  regarded  as  a  proper 
basis  upon  which  to  determine  the  value, 
when  the  fact  becomes  material  in  the  ad- 
ministration of  justice."'  I  may  close  these 
sayings  of  eminent  jurists  with  the  language 
of  Chief  Justice  Gibson,  upon  stock-jobbing 
contracts   (Wilson    v.    Davis,   5    Watts    &    S. 


100 


PRICE  PAID. 


r»23).  "To  have  stipulatod,"  says  he,  "for  a 
rijrht  to  recruit  on  separate  atcnmit,  wouhl 
have  j;iven  to  the  asreeinent  an  appearance  of 
trick,  lilve  those  of  stock-jobbins  contracts,  to 
(U'liver  a  jriven  number  of  shares  at  a  certain 
day,  in  wliicli  tlie  selhM-'s  performance  has 
been  forestalh'd  by  what  is  called  cornering'; 
in  other  words,  bnyiny  up  all  the  floating 
shares  in  tlie  market.  These  contracts,  like 
•other  stock-Jobbing  transactions,  in  which  par- 
ties deal  upon  honor,  are  seldom  subjectetl  to 
the  test  of  judicial  experiment,  but  they 
would  necessarily  be  declared  fraudulent." 

■Wiiiiout  adding  more.  1  think  it  isconclusive- 
ly  shown  that  what  is  called  the  market  price, 
or  the  quotations  of  the  articles  for  a  given 
day.  is  not  always  the  only  evidence  of  actual 
value,  but  that  the  true  value  may  be  drawn 
from  other  sources,  when  it  is  shown  that  the 
price  for  the  particular  day  had  been  unnat- 
urally inflated.  It  remains  only  to  ascertain 
whether  the  defendant  gave  such  evidence  as 
to  recjuire  the  court  to  submit  to  the  jury  to 
ascertain  and  determine  the  fair  market  value 
of  crude  oil  per  gallon,  on  the  olst  of  Decem- 
ber. 18(19.  as  demanded  by  the  defendant  in 
his  tifteenth  point.  There  was  evidence  from 
which  the  jury  might  have  adduced  the  fol- 
lowing facts,  viz.:  That  in  the  month  of  Oc- 
tober 18()9.  a  number  of  persons  of  large 
capital,  and  among  them  Kirkpa  trick  & 
Lyons,  combined  together  to  purchase  crude 
oil,  and  hold  it  until  The  close  of  the  year 
1S09;  that  these  persons  were  the  holders,  as 
purchasers,  of  a  large  number  of  sellers'  op- 
tion contracts,  similar  to  the  one  in  suit,  that 
they  bought  oil  largely,  and  determined  to 
hold  it  from  the  market  until  the  year  1870 
before  selling;  that  oil.  in  consequence  of 
this  combination,  ran  up  in  price,  in  the  face 
of  an  increased  supply,  until  the  31st  day  of 
December  18()9.  reaching  the  price  of  seven- 
teen to  eighteen  cents  ijer  gallon,  and  then 
suddtnly  dropped  as  soon  as  the  year  closed. 
Major  I'-rew.  one  of  the  number,  says:  "It 
was  our  purpose  to  take  the  oil.  pay  for  it, 
and  keep  it  until  January  1st  1870.  otherwise 
we  would  have  been  heading  the  market  on 
ourselves."  ifr.  Long  says  that  on  the  3d  of 
January  1870  he  sold  oil  to  Fisher  &  Brothers 
(the  i)lnintifts)  at  thirteen  cents  a  gallon,  and 
■could   lind   no  other  jiurchaser  at   that   price. 


Several  witnesses,  dealers  in  oil,  testify  that 
they  knew  of  no  natural  cause  to  create  such 
a  rise  in  price,  oi-  to  make  the  difference  iu 
price  from  December  to  .lanuary.  It  was  tes- 
titied,  on  the  contrary,  that  the  winter  produc- 
tion of  oil  was  greater  in  December  1809  than 
in  former  years  by  several  thousand  barrels 
per  day,  a  fact  tending  to  reduce  the  price, 
wheu  not  sustained  by  other  means.  Mr. 
Benn  says  he  knew  no  cause  for  the  sudden 
fall  in  price  on  the  1st  .lanuary  1870.  except 
that  the  so-called  combination  ceased  to  buy 
at  the  last  of  December  18(i9. 

It  was,  therefore,  a  fair  question  for  the 
jin\v  to  determine  whether  the  price  which 
was  demanded  for  oil  on  the  last  day  of  De- 
cember 1809  was  not  a  fictitious,  unnatural, 
inflated  and  temporary  price,  the  result  of  a 
combination  to  "bull  the  market,"  as  it  is 
termed,  and  to  compel  sellers  to  pay  a  false 
and  swollen  price  in  order  to  fulfil  their  con- 
tracts. If  so,  then  such  price  was  not  a  fair 
test  of  the  value  of  the  oil,  and  the  jury 
would  be  at  liberty  to  determine,  from  the 
prices  before  and  after  the  day,  and  from  oth- 
er sources  of  infonnation,  the  acttial  market 
value  of  the  oil  on  the  31st  of  December  1809. 
Any  other  cause  would  be  unjust  and  in- 
jurious to  fair  dealers,  and  would  enable 
gamblers  in  the  article  to  avail  themselves  of 
their  own  wrong,  and  to  wrest  from  honest 
dealers  the  fruits  of  their  business.  It  can- 
not be  possible  that  a  "corner,"  such  as  took 
place  a  few  weeks  since  in  the  market  for  the 
stock  of  a  western  railroad  company,  where 
shares,  worth  in  the  ordinary  market  about 
sixty  dollars  each,  were  by  the  secret  opera- 
tions of  tAvo  or  three  large  capitalists,  forced 
up  in  a  few  days  to  a  price  over  two  hundred 
dollars  a  share,  can  be  a  lawful  measure  of 
damages.  Men  are  not  to  be  stripped  of 
their  estates  by  such  cruel  and  wrongful  prac- 
tices; an<l  courts  of  justice  cannot  so  wholly 
ignore  justice  as  to  assimie  such  a  false  stand- 
ard of  compensation.  Our  views  upon  the  ef- 
fect of  the  affidavit  of  defence,  on  which  the 
learned  judge  in  a  great  measure  rules  the 
question  of  damages,  will  lie  expressed  in  the 
case  of  Kountz  v.  Oil  Refining  Co.  [72  Pa.  St. 
392]  in  an  opinion  to  be  read  immediately. 

.Judgment  reversed,  and  a  venire  facias  de 
novo  awarded. 


PRICE  I'AID. 


lOi 


McCONNELL  v.  Ill  <  MIES. 

(29   Wis.   r,37.) 

Supreme  Court  of  Wisconsin.    .Ian.  Term,  1872. 

Appeal  from  circuit  court,  Green  Lake 
county. 

Rj-au  &  Kiinliall.  for  appellant.  A.  B. 
Hamilton  and  Butler  «fc  Winkler,  for  re- 
spondent. 

LYOX.  .7.  The  bill  of  exceptions  does  not 
purport  to  contain  all  of  the  evidence. 

We  cannot,  tlierefore,  review  the  evidence, 
but  must  presume  that  it  sustains  the  find- 
ings of  fact  by  the  circuit  court.  That 
couit  having  found  that  the  material  alle- 
gations of  the  complaint  were  proved,  it  fol- 
lows that  if  the  complaint  states  a  valid 
cause  of  action,  the  plaintiff  was  entitled  to 
judgment. 

We  think  that  the  complaint  does  state  a 
valid  cause  of  action.  It  avers  that  an  ex- 
ecutory contract  for  the  sale  and  purchase  of 
wheat  was  made  by  the  parties,  and  that, 
in  pursuance  thereof,  the  plaintiff  delivered 
to  the  defendants,  and  the  defendants  ac- 
cepted and  received  the  wheat.  It  must  be 
true  that  by  such  delivery  and  acceptance 
the  title  to  the  wheat  became  vested  in  the 
defendants,  and  the  right  to  have  the  price 
therefor,  when  the  same  should  be  deter- 
mined as  provided  in  the  contract,  in  like 
manner  became  vested  in  the  plaintitf. 

But  it  is  urged  on  behalf  of  the  defendants 
that  the  transaction  was  invalid  as  a  sale, 
because  the  contract  did  not  limit  the  plain- 
tiff to  the  selection  of  any  particular  day.  or 
of  a  day  within  a  specified  time,  on  which 
the  market  price  of  wheat  in  Milwaukee 
should  control  the  price  of  the  wheat  in 
(luestion,  but  left  him  the  option  to  select 
any  day  in  the  future  for  the  purpose  of 
fixing  the  price. 

The  contract  furnishes  a  criterion  for  as- 
certaining the  price  of  wheat;    leaving  noth- 


ing in  relation  thereto  for  further  negotia- 
tion between  the  parties.  This  is  all  that 
the  law  requires.  Story,  Sales.  §  "JliU.  No 
case  has  been  cite<l.  and  we  are  unable  to 
find  one,  which  holds  that  it  is  essential  to 
the  validity  of  a  sale  in  sucii  cases  that  the 
criteri(jn  agreed  upon  should,  by  the  terms 
of  the  contract  of  .sale,  be  applied,  and  the 
price  thereliy  determined,  on  any  specified 
day  or  within  a  spe<ified  time.  .ludge  Story, 
In  the  section  of  his  treatise  above  cited,  ev- 
idently does  not  intend  to  lay  down  any 
such  rule.  It  may  be  that,  if  plaintiff  had 
delayed  unreasonably  to  make  such  sele<*- 
tion  after  being  re<iuested  to  make  the 
same,  he  might  l)e  compelled  to  do  so.  But 
we  do  not  decide  this  jioint. 

It  is  further  argued  that,  after  a  valid 
sale  and  before  payment  of  the  price,  there- 
must  l)e  a  debt  owing  by  the  vendee  to  the 
vendor,  while  in  this  case,  until  the  price  of 
the  wheat  was  ascertained,  there  was  no 
indebtedness.  The  latter  part  of  this  prop- 
osition is  erroneous.  As  soon  as  the  wheat 
was  delivered,  the  defendants  owed  the 
plaintiff  therefor.  There  was  therefore  a 
debt,  but  the  amount  thereof  was  not  ascer- 
tained. It  remained  unliquidated  initil  the 
price  of  the  wheat  was  detei-mined. 

The  objections  that  the  assessor  could  not 
list  the  claim  for  the  price  of  the  wheat  for 
taxation,  and  that  the  same  could  not  be 
readied  by  garnishee  process  at  the  suit  of 
a  creditor  of  the  plaintiff",  while  such  price 
remained  undetermined,  present  no  practical 
difficulties.  The  assessor  would  fix  the 
value  of  the  demand  according  to  his  best 
judgment  as  in  other  cases  of  the  valuation 
of  property  and  credits:  and  the  creditor  in 
the  garnishee  proceeding  would  probably  be 
subrogated  to  the  rights  of  the  plaintiff  in 
respect  to  determining  the  contract  price 
for  the  wheat. 

BY  THE  COURT.  The  judgment  of  the 
circuit  court  is  affirmed. 


102 


MISTAKE. 


WOOD  V.  BOYNTOX  et  al. 

(25  N.  ^y.  Hop-  -42.  (i4  AYis.  ^Cm.) 

Supreme   Court   of   Wisconsin.    Oct.    13.    188."). 

Appeal  from  circuit  court,  Milwaukee 
couutj-. 

Johnson,  Kietbrock  &  Ilalsey,  for  appel- 
lant.    X.  S.  Minphey,  for  re.><pondeuts. 

TAYLOlv,  .T.  This  action  was  bron?:ht  in 
the  circuit  court  for  Milwaukee  county  to 
recover  the  possession  of  an  Uiicut  diamond 
of  the  alleged  value  of  $1,000.  The  case  was 
tried  in  the  circuit  court,  and  after  hearing 
all  the  evideuce  in  the  case,  the  learned  cir- 
cuit judge  directed  the  jury  to  tind  a  verdict 
for  the  defendants.  The  plaintilf  excepted 
to  such  instruction,  and,  after  a  verdict  was 
rendered  for  the  defendants,  moved  for  a 
new  trial  upon  the  minutes  of  the  judge. 
The  motion  was  dened,  and  the  plaintiff 
dulj-  excepted,  aud  after  judgmeut  was  en- 
tered in  favor  of  the  defendants,  app?aled  to 
this  court.  The  defeudauts  are  partuers  in 
the  jewelry  business.  On  the  trial  it  ap- 
peared that  on  and  before  the  twenty-eighth 
of  December,  1>83,  the  plaiutiff  was  the  own- 
er of  and  in  the  possession  of  a  small  stone 
of  the  nature  and  value  of  which  she  was 
ignoiaut;  that  on  that  day  she  sold  it  to  one 
of  the  defendants  for  the  sum  of  one  dollar. 
Afterwards  it  was  ascertained  that  the  stone 
was  a  rough  diamond,  and  of  the  value  of 
about  .$700.  After  learning  this  fact  the 
plaintiff  tendered  the  defendants  the  one  dol- 
lar, aud  ten  cents  as  interest,  aud  demanded 
a  return  of  the  stone  to  her.  The  defend- 
ants refused  to  deliver  it,  and  therefore  she 
commenced  this  action. 

The  plaintiff  testified  to  the  circumstauces 
attending  the  sale  of  the  stone  to  Mr.  Samuel 
B.  Boyntou,  as  follows:  '"The  lirst  time 
Boynton  saw  that  stone  he  was  talking  about 
buying  the  topaz,  or  whatever  it  is,  in  Sep- 
tember or  October.  I  went  into  his  store  to 
get  a  little  pin  mended,  and  I  had  it  in  a 
small  box.— the  pin.— a  small  ear-ring;  *  *  * 
tliis  stone,  and  a  broken  sleeve-buttou  were 
in  the  box.  Mr.  Boynton  turned  to  give  me 
a  check  for  my  pin.  I  thought  I  would  ask 
him  what  the  stone  was,  and  I  took  it  out 
of  the  l)ox  and  asked  him  to  please  tell  me 
what  that  was.  He  took  it  in  his  hand  and 
seemed  some  time  looking  at  it.  I  told  him 
I  had  been  told  it  was  a  topaz,  and  he  said 
it  might  be.  He  says,  "I  would  buy  this; 
wouhl  you  sell  it?'  I  told  him  I  did  not 
know  but  what  I  would.  What  would  it  be 
AvorthV  And  he  said  he  did  not  know;  he 
would  give  me  a  dollar  and  keep  it  as  .a 
specimen,  aud  I  told  him  I  would  not 
sell  it;  and  it  was  certainly  pretty  to  look 
at.  He  asked  me  where  I  found  it,  and  I 
told  him  in  Eagle.  He  asked  about  ho.v 
far  out.  and  I  said  right  in  the  village,  and 
I  went  out.  Afterwards,  and  about  the 
twenty-eighth  of  December,  I  needed  money 


pretty  badly,  aud  thought  every  dollar  would 
help,  and  1  took  it  back  to  Mr.  Boynton  and 
told  him  I  had  brought  back  the  topaz,  aud 
he  says,  'Well,  yes;  what  did  I  offer  you  for 
itV  and  I  says,  'One  dollar;'  aud  he  stepped 
to  the  change  drawer  and  gave  me  the  dol- 
lar, and  I  went  out.''  In  another  part  of  her 
testimony  she  says:  "Before  I  sold  the  stone 
I  had  no  knowledge  whatever  that  it  was  a 
diamond.  I  told  him  that  I  had  been  ad- 
vised that  it  was  probably  a  topaz,  and  he 
.said  probably  it  was.  The  stone  was  about 
the  size  of  a  canary  l)ird's  egg.  nearly  the 
shape  of  an  egg. — worn  pointed  at  one  end; 
it  was  nearly  stiaw  color,— a  little  darker," 
She  also  testified  that  before  this  action  was 
commenced  she  tendered  the  defendants 
$1.10,  and  demanded  the  return  of  the  stone, 
which  the.v  refused.  This  is  substautially 
all  the  evidence  of  what  took  place  at  and 
before  the  sale  to  the  defendants,  as  testi- 
fied to  by  the  plaintiff  herself.  She  pro- 
duced no  other  witness  on  that  point. 

The  evidence  on  the  part  of  the  defendant 
is  not  very  different  from  the  version  given 
by  the  plaintiff,  and  certainly  is  not  more 
favorable  to  the  plaintiff.  Mr.  Samuel  B. 
Boynton.  the  defendant  to  whom  the  stone 
was  sold,  testified  that  at  the  time  he  bought 
this  stone,  he  had  never  seen  an  uncut  dia- 
mond; had  se3n  cut  diamonds,  but  they  are 
quite  dilferent  from  the  uncut  ones;  "he 
had  no  idea  this  was  a  diamond,  and  it  never 
entered  his  brain  at  the  time."  Considerable 
evidence  was  given  as  to  what  took  place 
after  the  sale  and  purchase,  but  that  evi- 
dence has  very  little  if  any  bearing,  upon 
the  main  point  in  the  case. 

This  evidence  clearly  shows  that  the  plain- 
tiff sold  tlie  stone  in  question  to  the  defend- 
ants, and  deliveied  it  to  them  in  December. 
1883,  for  a  consideration  of  one  dollar.  The 
title  to  the  stone  passed  by  the  sale  and  de- 
li veiy  to  the  defendants.  How  has  that  title 
been  divested  and  again  vested  in  the  plain- 
tiff? The  contention  of  the  learned  counsel 
for  the  appellant  is  that  the  title  became 
vested  in  the  plaiutiff  by  the  tender  to  the 
Boyntons  of  the  purchase  money  with  inter- 
est, and  a  demand  of  a  return  of  the  stone 
to  her.  Unless  such  tender  aud  demand  re- 
vested the  title  in  the  appellant,  she  cannot 
maintain  her  action.  The  only  (luestiou  in 
the  case  is  whether  there  was  anything  in 
the  sale  Avhich  entitled  the  vendor  (the  ap- 
pellant) to  rescind  the  sale  and  so  revest  the 
title  in  her.  The  only  reasons  Ave  knoAV  of 
for  rescinding  a  sale  and  rcA'esting  the  title 
in  the  vender  so  that  he  may  maintain  an 
action  at  law  for  the  recovery  of  the  posses- 
sion agaiust  his  veudee  are  (1)  that  the  ven- 
dee AA-as  guilty  of  some  fraud  in  procuring  a 
sale  to  be  made  to  him;  (2)  that  there  Avas  a 
mistake  made  by  the  vendor  in  delivering  an 
article  Avhich  Avas  not  the  article  sold,— a 
mistake  in  fact  as  to  the  identity  of  the  thing 
sold  Avith  the  thing  delivered  upon  the  sale. 
This  last  is  not  in  reality  a  rescission  of  the 


MISTAKE. 


103 


sale  made,  as  )lu'  tliinjf  delivered  was  not 
the  thiuff  sold,  and  no  title  ever  passed  to 
the  vendee  by  such  delivery. 

lu  this  case,  upon  the  plaintiff's  own  evi- 
dence, there  can  be  no  just  fjrruund  for  al- 
leging that  she  was  induced  to  make  the  sale 
she  did  by  any  fraud  or  unfair  dealings  on 
the  part  of  Mr.  Boynton.  Both  were  en- 
tir(!ly  ignorant  at  the  time  of  the  character 
of  the  stone  and  of  its  intrinsic  value.  Mr. 
Boynton  was  not  an  expert  in  uncut  dia- 
monds, and  had  made  no  examination  of  the 
stone,  except  to  take  it  in  his  hand  and  look 
at  it  before  he  made  the  offer  of  one  dollar, 
which  was  refused  at  the  time,  and  after- 
wards accepted  without  any  comment  or 
further  examination  made  by  Mr.  Boynton. 
The  appellant  had  the  stone  in  her  posses- 
sion for  a  long  time,  and  it  appears  from  her 
own  statement  that  she  had  made  some  in- 
quiry as  to  its  nature  and  qualities.  If  she 
chose  to  sell  it  without  further  investigation 
as  to  its  intrinsic  value  to  a  person  who  was 
guilty  of  no  fraud  or  unfaiiness  which  in- 
duced her  to  sell  it  for  a  small  sum,  she  can- 
not repudiate  the  sale  because  it  is  after- 
Avards  ascertained  that  she  made  a  bad  bar- 
gain. Kennedy  v.  Panama,  etc.,  Mail  Co., 
L.  R.  2  Q.  B.  580.  There  is  no  pretense  of 
any  mistake  as  to  the  identity  of  the  thing 
sold.  It  was  produced  by  the  plaintiff  and 
exhibited  to  the  vendee  before  the  sale  was 
made,  and  the  thing  sold  Avas  delivered  to 
the  vendee  when  the  purchase  price  Avas 
paid.  Kennedy  v.  Panama,  etc.,  Mail  Co., 
supra,  587;  Street  v.  Blay,  2  Barn.  &  Adol. 
450;  Gompertz  v.  Bartlett,  2  El.  &  Bl.  84!); 
Gurney  v.  Womersley,  4  El.  &  Bl.  133;  Ship's 
Case,  2  De  G.,  J.  i^-  S.  544.  Suppose  the  ai)- 
pellant  had  produced  the  stone,  and  said  she 
had  been  told  that  it  was  a  diamond,  and 
she  believed  it  was,  but  had  no  knowledge 
herself  as  to  its  character  or  value,  and  Mi-. 
Boynton  had  given  her  !t;5(K)  for  it,  could  he 
have  rescinded  the  sale  if  it  had  turned  out 
to  be  a  topaz  or  any  other  stone  of  very 
small  value?  Could  Mr.  Boynton  have  re- 
scinded the  sale  on  the  ground  of  mistake? 
Clearly  not,  nor  could  he  rescind  it  on  the 
ground  that  there  had  been  a  breach  of 
Avarranty,  because  there  Avas  no  Avari-anty, 
nor  could  he  rescind  it  on  the  ground  of 
fraud,  unless  he  could  show  that  she  falsely 
declared  that  she  had  been  told  it  Avas  a  dia- 
mond, or.  if  she  had  been  so  told,  still  she 
kneAV  it  was  not  a  diamond.  See  Street  v, 
Blay,   supra. 


It  is  urged,  with  a  goiwl  de.il  of  earnest- 
ness, on  the  part  of  the  counsel  for  the  appi'l- 
lant  that,  because  it  has  turned  <mt  that 
the  stone  was  immensely  more  valuable  than 
the  parties  at  the  time  of  the  sale  supposeil 
it  was,  such  fact  alone  is  a  ground  for  the 
re.scissi(in  of  the  sale,  and  thar  ract  was  evi- 
dence of  fraud  on  the  part  of  the  vendee. 
Whether  inadecpiacy  of  price  is  to  be  re- 
ceived as  evidence  of  fraud,  even  in  a  suit 
in  ecjuity  to  avoid  a  sale,  depends  ujjon  the 
facts  known  to  the  parties  at  the  time  the 
sale  is  made  Wlicn  this  sale  was  made  the 
value  of  the  thing  sold  was  open  to  the  in- 
vestigation of  both  parties,  neither  knew  its 
intrinsic  value,  and,  so  far  as  the  evidence 
in  this  case  shows,  both  supptj.sed  that  the 
price  paid  Avas  adccpiate.  How  can  fraud  be 
predicated  upon  such  a  sale,  even  though 
after-investigation  showed  that  the  intrinsic 
A-alue  of  the  thing  sold  was  hundreds  of 
times  greater  than  the  price  paid?  It  cer- 
tainly shows  no  such  fraud  as  Avould  author- 
ize the  vendor  to  rescind  the  contract  and 
bring  an  action  at  law  to  recover  the  posses- 
sion of  the  thing  sold.  Whether  that  fact 
Avould  have  any  influence  in  an  action  in 
equity  to  avoid  the  sale  Ave  need  not  consid- 
er. See  Stettheimer  v.  Killip,  75  X.  Y.  287; 
Etting  V.  Bank  of  U.  S.,  11  Wheat.  .50. 

We  can  find  nothing  in  the  evidence  from 
which  it  could  be  justly  inferred  that  .Mr. 
Boynton,  at  the  time  he  offered  the  plaintitt 
one  dollar  for  the  stone,  had  any  knowledge 
of  the  real  A-alue  of  the  stone,  or  that  he  en- 
tertained even  a  belief  that  the  stone  Avas 
a  diamond.  It  cannot,  therefore,  be  said 
that  there  Avas  a  suppression  of  knowledge 
on  the  part  of  the  defendant  as  to  the  value 
of  the  stone  which  a  court  of  eciuity  might 
seize  upon  to  avoid  the  sale.  The  following 
cases  show  that,  in  the  absence  of  fraud  or 
warranty,  the  A-alue  of  the  property  sold,  as 
compared  Avith  the  price  paid,  is  no  ground 
for  a  rescission  of  a  sale.  Wheat  v.  Cross, 
31  Md.  ni);  Lambert  v.  Heath,  15  Mees.  ^"t  W. 
487;  Bryant  v.  I'ember.  45  Vt.  4S7;  Kuel- 
kamp  V.  Ilidding.  ;n  Wis.  503-511.  How- 
ever unfortunate  the  plaintiff  may  liaA-e  been 
in  selling  this  valuable  stone  for  a  mere 
nominal  sum.  she  has  failed  entirely  to  make 
out  a  case  either  of  fraud  or  mistake  in  the 
sale  such  as  Avill  entitle  her  to  a  rescission  of 
such  sale  so  as  to  recover  the  property  sold 
in  an  action  at  law. 

The  judgment  of  the  circuit  court  is  af- 
lirmed. 


104 


MISTAKE. 


HUTHMACHER  v.   HARRIS'   ADM'RS. 

(38  Pa.  St.  491.) 

Supreme  Court  of  Pennsylvania.     ^March  25, 
1861. 

Trover  by  Rosanua  Gardner,  administratrix, 
and  Silas  Sutton  and  IVter  II.  Scovill,  admin- 
istrators of  Elisha  Harris,  deceased,  against 
David  .M.  Huthmaelier.  Judgment  for  plain- 
tiffs, and  defendant  brings  error.     Affirmed. 

The  property  in  controversy,  consisting  of 
promissory  notes  and  two  watches,  was  found 
by  defendant  in  a  square  block  of  wood,  on 
the  top  of  which  was  a  horizontal  wheel  with 
a  perpendicular  iron  spindle,  called  in  the  ven- 
due list  a  "drill  machine,"  which  was  bought 
by  him  at  a  sale  of  the  effects  of  the  said 
Harris. 

Hendrick  B.  Wright,  for  plaintiff  in  error. 
E.  L.  Dana,  for  defendants  in  error. 

WOODWARD.  J.  The  ground  on  which 
we  affirm  this  judgment  is,  that  there  was  no 
sale  of  the  valuables  contained  in  the  block 
of  wood,  which  is  called,  in  virtue  of  its  hori- 
zontal wheel  and  upright  spindle,  "a  drill  ma- 
chine." Sale,  said  Mr.  Justice  Wayne,  in  Wil- 
liamson V.  Berry,  8  How.  i>44.  is  a  word  of 
precise  legal  import,  both  at  law  and  in  equi- 
ty. It  means  at  aU  times  a  contract  between 
parties  to  pass  rights  of  property  for  money 
which  the  buyer  pays,  or  promises  to  pay,  to 
the  seller  for  the  thing  bought  and  sold. 

That  no  such  contract  was  made  by  tliese 
parties  in  respect  to  the  contents  of  the  drill 
machine,  we  deduce  from  the  agreed  facts  of 
the  case.  The  macliine  itself,  and  eveiy  es- 
sential part  and  constituent  element  of  it,  were 
well  sold.  The  consideration  paid,  though  on- 
ly fifteen  cents,  was  in  law  a  quid  pro  quo, 
and  the  sale,  unaffected  by  fraud  or  misrep- 
resentation, passed  to  the  purchaser  an  inde- 
feasible right  to  the  machine  and  all  the  uses 
and  purposes  to  which  it  could  be  applied. 
But  the  contents  of  the  machine  are  to  be 
distinguished  from  its  constituent  parts.  They 
were  unknown  to  the  administrators,  were  not 
inventoried,  were  not  exposed  to  auction,  were 
not  sold.  Of  course  they  were  not  bought. 
All  that  was  sold  was  fairly  bought,  and  may 
be  held  by  tlie  purchasers.  The  title  to  what 
was  not  sold  remains  unchanged.  A  sale  of 
a  coat  does  not  give  title  to  the  pocket-book 
which  may  happen  to  be  temporarily  deposit- 
ed in  it,  nor  the  sale  of  a  chest  of  drawers  a 
title  to  the  deposits  therein.  In  these  cases, 
and  many  others  that  are  easily  imagined,  the 
contents  are  not  essential  to  the  existence  or 
usefulness  of  the  thing  contracted  for.  and 
not  being  within  the  contemplation  or  inten- 
tion of  the  contracting  parties,  do  not  pass  by 
the  sale.  The  contract  of  sale,  like  all  other 
contracts,  is  to  lie  controlled  by  the  clearly  as- 
certained intention  of  the  parties. 

The  argmnent  proceeded  very  much  on  the 
doctrine  that  CMiuity  will,  in  certain  cases,  re- 
lieve against  mistakes  of  fact  as  well  as  of 
law;    but    if   there    was   no   contract   of   sale, 


there  could  be  no  mistake  of  fact  to  vitiate  it. 
and  therefore  that  doctrine  has  no  possible  ap- 
plication. Mistake  is  sometimes  a  ground  ot 
relief  in  equity;  but  a  man  who  puts  up  his 
wares  at  auction  and  sells  them  to  the  high- 
est bidder,  has  no  right  to  relief  on  the  ground 
that  he  was  ignorant  of  the  value  of  that 
which  he  sold.  Such  a  mistake  comes  of  his 
own  negligence,  for  it  is  his  duty  to  possess 
all  necessary  knowledge  of  the  value  of  that 
which  he  brings  to  market,  and  the  mle  is 
general  that  if  a  party  becomes  remediless  at 
law  by  Ids  own  negligence,  equity  will  leave 
him  to  bear  the  consequences. 

Nor  could  these  administrators,  had  they 
sold  the  contents,  have  pleaded,  in  addition  to 
their  ignorance,  their  fiduciary  character,  and 
their  possible  liability  for  a  devastavit,  in  de- 
feat of  the  vested  rights  of  the  purchaser;  for, 
in  respect  to  the  personalty  of  the  decedent, 
they  stood  in  the  dead  man's  shoes,  and  were 
in  fact,  as  they  are  commonly  called  in  law, 
his  personal  representatives.  The  law  cast 
the  ijersonal  estate  upon  them  for  purposes  of 
administration,  and  a  fair  sale  made  in  pursuit 
of  that  purpose,  would  confer  as  perfect  a  title 
as  if  made  by  a  living  owner.  They,  no  more 
than  any  other  vendor,  could  set  aside  such  a 
sale  to  avert  tlie  consequences  of  their  own 
negligence. 

But  inasmuch  as  they  did  not,  in  point  of 
fact,  sell  the  valuables  which  are  in  dispute, 
these  principles,  and  all  the  arguments  drawn 
from  tlie  law  of  mistake,  are  outside  of  the 
case. 

If,  then,  there  was  no  sale  and  purchase  of 
the  contents  of  the  block  or  machine,  how  did 
Huthmacher,  when  he  discovered  his  unsus- 
pected wealth,  hold  it?  Evidently  as  treas- 
ure trove,  which,  though  commonly  defined  as 
gold  or  silver  hidden  in  the  ground,  may,  in 
our  commercial  day,  be  taken  to  include  the 
paper  representatives  of  gold  and  silver,  espe- 
cially when  they  are  found  hidden  with  both 
of  these  precious  metals.  And  it  is  not  nec- 
essarjr  that  the  hiding  should  be  in  the  ground, 
for  we  are  told  in  3  Inst.  132,  that  it  is  not 
"material  whetlier  it  be  of  ancient  time  hid- 
den in  the  ground,  or  in  tlie  roof,  or  walls,  or 
other  part  of  a  castle,  hou.se,  building,  ruins 
or  otlierwise." 

Tlie  certain  rule  of  the  common  law,  in  re- 
gard to  treasure  trove,  as  laid  down  by  Brac- 
ton,  lib.  3,  c.  3,  and  as  quoted  in  Viner's 
Abridgement,  Is,  "that  he  to  whom  the  prop- 
erty is,  shall  have  treasure  trove,  and  if  he 
dies  before  it  be  found,  his  executors  shall 
have  it,  for  nothing  accrues  to  the  king  unless 
when  no  one  knows  who  hid  that  treasure." 
The  civil  law  gave  it  to  the  finder,  according 
to  the  law  of  nature,  and  we  suppose  it  was 
this  principle  of  natural  law  that  was  referred 
to  in  what  was  said  of  treasure  hid  in  a  field 
in  Matthew's  Go.spel,  xiii.  44. 

But  the  common  law,  which  we  administer, 
gave  it  always  to  the  o>vner  if  he  could  be 
found,  and  if  he  could  not  be,  then  to  the 
king,  a.s  wrecks,   strays,   and  other  goods  are 


MISTAKE. 


given,  "whereof  no  person  can  claim  proper- 
ty." 3  Inst.  132.  Huthmacber.  therefore, 
held  the  unsold  valualjles  for  the  i)ersonal  rep- 
resentatives of  the  deceased  owner. 

Several  sporadic  cases,  some  of  which  were 
hiyhly  apocryphal,  were  mentioned  in  the  argu- 


105 


ment  as  affording  analogies  more  or  less  ap- 
proi)riate  to  this  ca.se,  but  it  is  quite  unneces- 
sary to  discuss  them,  because  if  they  touch, 
they  do  not  encumber  the  clear  ground  where^ 
on,  as  above  indicated,  we  rest  our  judgment. 
The  judgment  Is  affirmed. 


106 


MISTAKE. 


SHERWOOD  V.  WALKER  ot  nlJ 

(33  N.  W.  919,  60  Mich.  508.) 

Supreme  Court  of  Midiipn.    July  7,  1887. 

Error  to  circuit  court,  Wayue  couuty;  Jen-  j 
nison.  Judge.  i 

C.  J.   Reilly,   for  plaintiff.     Wm.   Aikman,  i 
Jr.,    (D.    C.    Holbrook.    of   counsel,)    for   de-  i 

fendants  and  apix'llants.  I 

! 

MORSE.  J.  R('i)lovin  for  a  cow.  Suit 
coninicnccd  in  justice's  court;  judgment  for 
plaintiff;  appealed  to  circuit  coiu't  of  Wayne 
county,  and  verdict  and  judgment  for  plain- 
tiff in  that  court.  The  defendants  bring 
error,  and  set  out  25  assignments  of  the 
same. 

The  main  controversy  depends  upon  the 
construction  of  a  contract  for  the  sale  of 
the  cow.  The  plaintiff  claims  that  the  ti- 
tle passed,  and  bases  his  action  upon  such 
claim.  The  defendants  contend  that  the  con- 
tract was  executory,  and  by  its  terms  no 
title  to  the  animal  was  acquired  by  plain- 
tiff. The  defendants  reside  at  Detroit,  but 
are  In  business  at  Walkervllle,  Ontario,  and 
have  a  farm  at  Greenlield.  In  Wayne  coiinty, 
upon  Avhich  were  some  blooded  cattle  sup- 
posed to  be  barren  as  breeders.  The  Walk- 
ers are  Importers  and  breeders  of  polled 
Angus  cattle.  The  plaintiff  is  a  banker  liv- 
ing at  Plymouth,  in  Wayne  county.  He  call- 
ed upon  the  defendants  at  Walkerville  for 
the  purchase  of  some  of  their  stock,  but 
found  none  there  that  suited  him.  Meeting 
one  of  the  defendants  afterwards,  he  was 
informed  that  they  had  a  few  head  upon  this 
Greenfield  farm.  He  was  asked  to  go  out 
and  look  at  them,  with  the  statement  at 
the  time  that  they  were  probably  barren, 
and  would  not  breed.  May  5,  188(i,  plaintiff 
went  out  to  Greenfield,  and  saw  the  cattle. 
A  few  days  thereafter,  he  called  upon  one  of 
the  defendants  with  the  view  of  purchasing 
a  cow,  known  as  "Rose  2d  of  Aberlone." 
After  considerable  talk,  it  was  agreed  that 
defendants  would  telephone  Sherwood  at  his 
home  in  Plymouth  In  reference  to  the  price. 
The  second  morning  after  this  talk  he  was 
called  up  by  telephone,  and  the  terms  of  the 
sale  were  finally  agreed  upon.  He  was  to 
pay  five  and  one-half  cents  per  pound,  live 
weight,  fifty  pounds  shrinkage.  He  was 
asked  how  he  intended  to  take  the  cow 
home,  and  replied  that  he  might  ship  her 
from  King's  cattle-yard.  He  requested  de- 
fendants to  confirm  the  sale  In  writing, 
which  they  did  by  sending  liim  the  following 
letter:  "Walkervllle,  May  15,  1886.  T.  C. 
Sherwood,  President,  etc.— Dear  Sir:  We 
confirm  sale  to  you  of  the  cow  Rose  2d  of 
AI)ei-lone.  lot  56  of  our  catalogue,  at  five 
and  a  half  cents  per  pound,  less  fifty  pounds 
shrink.  We  inclose  herewith  order  on  Mr. 
Graham  for  the  cow.  You  might  leave 
check  with  him,  or  mall  to  us  here,  as  you 
prefer.     Yours,     truly,     Hiram     Walker     & 

1  Dissenting  opinion  of  Shorsvoud,  J.,  omitted. 


Sons."  The  order  ujion  Graham  Inclosed  in 
the  letter  read  as  follows:  "Walkerville. 
May  15,  188(5.  George  Graham:  You  will 
please  deliver  at  King's  cattle-yard  to  Mr. 
T.  C.  Sherwood,  Plymouth,  the  cow  Rose 
2d  of  Aberlone,  lot  50  of  our  catalogue. 
Send  halter  with  the  cow,  and  have  her 
weighed.  Yours,  truly,  Hiram  Walker  & 
Sons."  On  the  twenty-first  of  the  same 
month  the  plaintiff  went  to  defendants' 
farm  at  Greenfield,  and  presented  the  order 
and  letter  to  (Jraham,  who  informed  him 
that  the  defendants  had  instructed  him  not 
to  deliver  the  cow.  Soon  after,  the  plain- 
tiff" tendered  to  Hiram  Walker,  one  of  the 
defendants,  .$80,  and  demanded  the  cow. 
Walker  refused  to  take  the  money  or  deliver 
the  cow.  The  plaintiff  then  Instituted  this 
suit.  After  he  had  secured  possession  of 
the  cow  under  the  writ  of  replevin,  the 
plaintiff  caused  her  to  be  weighed  by  the 
constal)le  who  served  the  writ,  at  a  place 
other  than  King's  cattle-yard.  She  weighed 
1,420  pounds. 

When  the  plaintiff,  upon  the  trial  in  the 
circuit  court,  had  su1)mitted  his  proofs  show- 
ing the  above  transaction,  defendants  moved 
to  strike  out  and  exclude  the  testimony  from 
the  case,  for  the  reason  that  it  was  irrelevant 
and  did  not  tend  to  show  that  the  title  to 
the  cow  passed,  and  that  it  showed  that  the 
contract  of  sale  was  merely  executory.  The 
court  refused  the  motion,  and  an  exception 
was  taken.  The  defendants  then  Introduced 
evidence  tending  to  show  that  at  the  time 
of  the  alleged  sale  it  was  believed  by  both 
the  plaintiff  and  themselves  that  the  cow 
was  barren  and  would  not  breed;  that  she 
cost  $850,  and  if  not  barren  woidd  be  worth 
from  $750  to  $1,000;  that  after  the  date  of 
the  letter,  and  the  order  to  Graham,  the  de- 
fendants were  informed  by  said  Graham 
that  in  his  judgment  the  cow  was  with 
calf,  and  therefore  they  instructed  him  not 
to  deliver  her  to  plaintiff,  and  on  the  twen- 
tieth of  May.  1880,  telegraphed  to  the  plain- 
tiff what  Graham  thought  about  the  cow  be- 
ing with  calf,  and  that  consequently  they 
could  not  sell  her  The  cow  had  a  calf  In 
the  month  of  October  following.  On  the 
nineteenth  of  May,  the  plaintiff'  wrote  Gra- 
ham as  follows:  "Plymouth,  May  19,  1886. 
yir.  Geoi-ge  Graham,  Greenfield — Dear  Sir: 
I  have  bought  Rose  or  Lucy  from  ^Ir.  Walk- 
er, and  will  be  there  for  her  Friday  morning, 
nine  or  ten  o'clock.  Do  not  water  her  In  the 
morning.  Y^ours,  etc.,  T.  C.  Sherwood." 
Plaintiff"  explained  the  mention  of  the  two 
cows  in  this  letter  by  testifying  that,  when 
he  wrote  this  letter,  the  order  and  let- 
ter of  defendants  were  at  his  house,  and, 
writing  in  a  hurry,  and  being  uncertain  as 
to  the  name  of  the  cow,  and  not  wishing  his 
cow  watered,  he  thought  it  would  do  no 
harm  to  name  them  both,  as  his  bill  of  sale 
would  show  which  one  he  had  purchased. 
Plaintiff'  also  testified  that  he  asked  defend- 
ants to  give  him  a  price  on  the  balance  of 


MISTAKK. 


107 


tlivMr  lioid  at  Oreonfield,  as  a  friend  thoujjlit 
of  buyiun  some,  and  received  a  letter  dated 
May  17.  1KS(5,  in  which  tliey  named  tlie  price 
of  five  cattle,  including  Lucy,  at  $!«),  and 
Rose  2d  at  $S0.  When  he  received  the  let- 
ter he  called  defendants  np  hy  teh'phoue, 
and  asked  them  why  they  put  Rose  2d  in 
the  list,  as  he  had  already  pui-chased  her. 
They  replied  that  they  knew  he  had.  but 
thoug:ht  it  would  make  no  difference  if  plain- 
tiff and  his  friend  concluded  to  take  the 
whole  herd. 

The  forejroinK  is  the  substance  of  all  the 
testimony  in  the  case. 

The  circuit  judge  instructed  the  jury  tliat 
if  they  believed  the  defendants,  when  they 
sent  the  order  and  letter  to  plaintiff,  meant 
to  pass  the  title  to  the  cow.  and  that  the 
cow  was  intended  to  be  delivered  to  plain- 
tiff, it  did  not  matter  whether  the  cow  was 
weighed  at  any  particular  place,  or  by  any 
particular  person;  and  if  the  cow  was  weigh- 
ed afterwards,  as  Sherwood  testified,  such 
weighing  would  be  a  sufficient  compliance 
with  the  order.  If  they  believed  that  de- 
fendants intended  to  pass  the  title  by  the 
writing,  it  did  not  matter  whether  the  cow 
was  Aveighed  before  or  after  suit  brought, 
and  the  plaintiff  would  be  entitled  to  recov- 
er. The  defendants  submitted  a  number  of 
requests  which  were  refused.  The  sub- 
stance of  them  Avas  that  the  cow  was  never 
delivered  to  plaintiff,  and  the  title  to  her 
did  not  pass  by  the  letter *and  order;  and 
that  under  the  contract,  as  evidenced  by 
these  writings,  the  title  did  not  pass  until 
the  cow  was  weighed  and  her  price  there- 
by determined;  and  that,  if  the  defendants 
only  agreed  to  sell  a  cow  that  would  not 
breed,  then  the  barrenness  of  the  cow  was 
a  condition  precedent  to  passing  title,  and 
plaintiff  cannot  recover.  The  court  also 
charged  the  jury  that  it  was  immaterial 
whether  the  cow  was  with  calf  or  not.  It 
will  therefore  be  seen  that  the  defendants 
claim  that,  as  a  matter  of  law,  the  title  to 
this  cow  did  not  pass,  and  that  the  circuit 
judge  erred  in  submitting  the  case  to  the 
jury,  to  be  determined  by  them,  upon  the 
intent  of  the  parties  as  to  whether  or  not 
the  title  passed  with  the  sending  of  the  let- 
ter and  order  by  the  defendants  to  the  i)laiu- 
tiff. 

This  question  as  to  the  passing  of  title  is 
fraught  Avith  difficulties,  and  not  always 
easy  of  solution.  An  examination  of  the 
multitude  of  cases  bearing  upon  this  subject, 
Avith  their  iutinite  variety  of  facts,  and  at 
least  apparent  conflict  of  laAV.  ofttimes  tends 
to  confuse  rather  than  to  enlighten  the  mind 
of  the  inquirer.  It  is  best,  therefore,  to  con- 
sider alAvays,  in  cases  of  this  kind,  the  gen- 
eral principles  of  the  laAv.  and  then  apply 
them  as  best  we  may  to  the  facts  of  the 
case  in  hand. 

The  coAV  being  AA-orth  over  .$.~)0.  the  con- 
tract of  sale,  in  order  to  be  valid,  must  be 
one  Avhere  the  purc-haser  has  received  or  ac- 


cepted a  part  of  the  goods,  or  given  some- 
thing in  earnest,  or  in  part  payment,  or 
Avhere  the  .seller  has  signed  some  note  or 
memorandum  in  Avriting.  How.  St.  §  OISC). 
Here  tlicre  Avas  no  actual  delivery,  nor  any- 
thing given  in  payment  or  in  earnest,  but 
there  Avas  a  sufficient  memorandum  signed 
by  the  defendants  to  take  the  case  out  of 
the  statute,  if  the  matter  contained  in  such 
memorandum  is  sufficient  to  constitute  a 
comjileted  sale.  It  is  evident  from  the  let- 
ter that  the  i)aymeut  of  the  pm-cjiase  price 
AAas  not  intended  as  a  conditi<»n  precedent 
to  the  passing  of  the  title.  Mr.  Sher\voo«l 
is  given  his  choice  to  pay  the  money  to 
Graham  at  King's  cattle-yards,  or  to  send 
check  by  mail. 

Nor  can  there  be  any  trouble  about  the 
delivery.  The  order  instructed  (Jraliam  to 
deliver  the  coav,  upon  presentation  of  the 
order,  at  such  cattle-yards.  But  the  price 
of  the  coAA'  AA'as  not  dciermined  upon  to  a 
certainty.  Befoi-e  this  could  be  ascertained, 
from  the  terms  of  the  contract,  the  coaa*  had 
to  be  Aveighed;  and,  by  the  order  inclosed 
with  the  letter,  (iraham  Avas  instructed  to 
have  her  Aveighed.  If  the  coav  had  been 
weighed,  and  this  letter  had  stated,  upon 
such  Aveight.  the  express  and  exact  price 
of  the  animal,  there  can  be  no  doubt  but 
the  cow  AAould  haA'e  passed  Avith  the  sending 
and  receipt  of  the  letter  and  order  by  the 
plaintiff.  Payment  Avas  not  to  be  a  concur- 
rent act  Avith  the  deliA-evy,  and  therein  this 
case  differs  from  Case  v.  DevAey.  .~m  Mich. 
110,  20  N.  W.  817,  and  21  X.  W.  Ml.  Also, 
in  that  case,  there  Avas  no  Avritten  memo- 
randum of  the  sale,  and  a  delivery  Avas  nec- 
essary to  pass  the  title  of  the  sheep;  and. 
it  Avas  held  that  such  delivery  could  only 
be  made  by  a  surrender  of  the  possession  to 
the  vendee,  and  an  acceptance  by  him.  De- 
livery by  an  actual  transfer  of  the  property 
from  the  vendor  to  the  vendee,  in  a  case  like 
the  present.  Avhere  the  article  can  easily  be 
so  transferred  by  a  manual  act,  is  usually 
the  most  significant  fact  in  the  transaction 
to  shoAV  the  intent  of  the  parties  to  pass  the 
title,  but  it  never  has  l)een  held  conclusiA'e. 
Neither  the  actual  delivery,  nor  the  absence 
of  such  delivery,  Avill  control  the  ca.se.  Avhere 
the  intent  of  the  parties  is  clear  and  mani- 
fest that  the  matter  of  delivery  Avas  not  a 
condition  precedent  to  the  passing  of  the 
title,  or  that  the  delivery  did  not  carry  Avith 
it  the  absolute  title.  The  title  may  pass,  if 
the  parties  so  agree.  Avhere  the  statute  of 
frauds  does  not  interpose  Avithout  delivery, 
and  property  may  be  delivered  aa  ith  the  un- 
derstanding that  the  title  shall  not  pass 
imtil  some   condition   is  performed. 

And  Avhether  the  parties  intended  the  ti- 
tle should  pass  before  delivery  or  not  is 
gem>rally  a  question  of  fact  to  be  deter- 
mined by  the  jury.  In  the  case  at  bar  the 
que.stion  of  the  intent  of  the  parties  was 
submitted  to  the  jury.  This  submission  AA-as 
riglit.  unless  from  the  reading  of  the  letter 


lOS 


MISTAKE. 


and  the  order,  and  all  llic  facts  of  the  oral 
bai'gainin^  or'  the  parties,  it  is  perfectly 
clear,  as  a  matter  of  law,  that  the  intent  of 
the  parties  was  that  the  cow  should  be 
weighed,  and  the  price  thereby  accurately 
determined,  before  she  should  become  the 
property  of  the  plaintiff.  I  do  not  think 
that  the  intent  of  the  parties  in  this  case  is 
a  matter  of  law,  but  one  of  fact.  The 
weijjhinjr  of  the  cow  was  not  a  matter  that 
needed  the  presence  or  any  act  of  the  de- 
fendants, or  any  agent  of  theirs,  to  be  well 
or  accurately  done.  It  could  make  no  dif- 
ference where  or  when  she  was  weighed,  if 
the  same  was  done  upon  correct  scales,  and 
by  a  competent  person.  There  is  no  pre- 
tense but  what  her  weight  was  fairly  ascer- 
tained by  the  plaintiff.  The  cow  was  spe- 
cilically  designated  by  this  writing,  and  her 
delivery  ordered,  and  it  cannot  be  said,  in  my 
opinion,  that  the  defendants  intended  that 
the  weighing  of  the  animal  should  be  done 
before  the  delivery  even,  or  the  passing  of 
the  title.  The  order  to  Graham  is  to  deliver 
her,  and  then  follows  the  instruction,  not 
that  he  shall  weigh  her  himself,  or  weigh 
her,  or  even  have  her  weighed,  before  de- 
livery, but  simply.  "Send  halter  with  the 
cow,  and  have  her  weighed." 

It  is  evident  to  my  mind  that  they  had 
perfect  confidence  in  the  integrity  and  re- 
sponsibility of  the  plaintiff,  and  that  they 
considered  the  sale  perfected  and  completed 
when  they  mailed  the  letter  and  oi-der  to 
plaintiff.  Tliey  did  not  intend  to  place  any 
conditions  precedent  in  the  way,  either  of 
payment  of  the  price,  or  the  weighing  of 
the  cow,  before  the  passing  of  the  title. 
They  cared  not  whether  the  money  was  paid 
to  Graham,  or  sent  to  them  afterwards,  or 
whether  the  cow  was  weighed  before  or 
after  she  passed  into  the  actual  manual 
grasp  of  the  plaintiff.  The  refusal  to  deliver 
the  cow  grew  entirely  out  of  the  fact  that, 
before  the  plaintiff  called  upon  Graham  for 
her,  they  discovered  she  was  not  barren,  and 
therefore  of  greater  value  than  they  had 
sold   her  for. 

The  following  cases  in  this  court  support 
the  instruction  of  the  court  below  as  to  tlie 
intent  of  the  parties  governing  and  con- 
trolling the  question  of  a  completed  sale, 
and  the  passing  of  title:  Lingham  v.  P]g- 
gleston.  27  Mich.  324;  Wilkinson  v.  Holiday, 
33  Mich.  3SG;  Grant  v.  :\Ierchants"  &  :Manu- 
facturers'  Bank,  35  Mich.  .j27;  Carpenter  v. 
Graham,  42  Mich.  194,  3  N.  W.  974;  Brewer 
v.  Salt  Ass'n.  47  Mich.  .134,  11  N.  W.  370; 
Whitcomb  v.  Whitney,  24  Mich.  4SG;  Byles 
V.  Colier,  .-|4  Mich.  1,  19  N.  W.  565;  Scotten 
V.  Sutter,  37  Mich.  527,  532;  Ducey  Lumber 
Co.  v.  Lane.  58  Mich.  520,  525,  25  N.  W. 
5r>8;  .Tenkinson  v.  Monroe,  01  Mich.  454,  28 
X.  W.  003. 

It  appears  from  the  record  that  both  par- 
ties supposed  this  cow  was  barren  and 
would  not  breed,  and  she  was  sold  by  the 
pound  for  an  insignificant  sum  as  compared 


with  her  real  value  if  a  breeder.  She  was 
evidently  sold  and  purchased  on  the  relation 
of  her  value  for  beef,  unless  the  plaintiff 
had  learned  of  her  true  condition,  and  con- 
cealed sucli  knowledge  from  the  defendants. 
Before  the  plaintiff  secured  possession  of 
the  animal,  the  defendants  learned  that  she 
was  with  calf,  and  therefore  of  great  value, 
and  unch'rtook  to  rescind  the  sale  by  re- 
fusing to  deliver  her.  The  question  arises 
wluHher  they  had  a  right  to  do  so.  The 
circuit  judge  ruled  that  this  fact  did  not 
avoid  the  sale  and  it  made  no  difference 
wlu>ther  she  was  barren  or  not.  I  am  of  tlie 
opinion  that  the  court  erred  in  this  holding. 
I  know  that  this  is  a  close  questiim,  and 
the  dividing  line  between  the  adjudicated 
cases  is  not  easily  discerned.  But  it  must 
be  considered  as  well  settled  that  a  party 
who  has  given  an  apparent  consent  to  a  con- 
tract of  sale  may  refuse  to  execute  it.  or  he 
may  avoid  it  after  it  has  been  completed, 
if  the  assent  was  founded,  or  the  contract 
made,  upon  the  mistake  of  a  material  fact, 
— such  as  the  subject-matter  of  the  sale,  the 
price,  or  some  collateral  fact  materially  in- 
ducing the  agreement;  and  this  can  be  done 
when  the  mistake  is  mutual.  1  Benj.  Sales, 
§§  005.  (!00;  Leake,  Cont.  339;  Story,  Sales, 
(4th  Ed.)  §§  377,  148.  See,  also.  Cutts  v. 
Guild.  57  N.  Y.  229;  Harvey  v.  Harris,  112 
Mass.  32;  Gardner  v.  Lane,  9  Allen,  492,  12 
Allen,  44;  Huthmacher  v.  Harris'  Adm'rs, 
38  Pa.  St.  491;  Byers  v.  Chapin,  28  Ohio  St. 
300;  Gibson  v.  Pelkie,  37  Mich.  380.  and 
cases  cited;  Allen  v.  Hammond,  11  Pet.  03- 
71. 

If  there  is  a  dift'erence  or  misapprehension 
as  to  the  substance  of  the  thing  bargained 
for;  if  the  thing  actually  delivered  or  re- 
ceived is  different  in  substance  from  the 
thing  bargained  for.  and  intended  to  be  sold, 
— then  there  is  no  contract;  but  if  it  be  only 
a  dift'erence  in  some  qiiality  or  accident, 
even  though  the  mistake  may  have  been  the 
actuating  motive  to  the  purchaser  or  seller, 
or  both  of  them,  yet  the  contract  remains 
binding.  "The  difticulty  in  every  case  is  to 
determine  whether  the  mistake  or  misap- 
prehension is  as  to  the  substance  of  the 
whole  contract,  going,  as  it  Avere,  to  the  root 
of  the  matter,  or  only  to  some  point,  even 
though  a  material  point,  an  error  as  to 
which  does  not  aft'ect  tlie  substance  of  the 
whole  consideration."  Kennedy  v.  Panama, 
etc.,  :\Iail  Co..  L.  R.  2  Q.  B.  580.  587.  It  has 
been  held,  in  accordance  with  the  principles 
al>ove  stated,  that  where  a  horse  is  bought 
under  the  belief  that  he  is  sound,  and  both 
vendor  and  vendee  honestly  believe  him  to 
be  sound,  the  purchaser  must  stand  by  his 
bargain,  and  pay  the  full  price,  unless  there 
was  a  warranty. 

It  seems  to  me.  however,  in  the  case  made 
by  this  record,  that  the  mistake  or  misap- 
prehension of  the  parties  went  to  the  whole 
substance  of  the  agreement.  If  the  cow 
was  a  breeder,  she  was  worth  at  least  .$750; 


MISTAKE. 


109 


if  baiTen.  she  was  wortli  not  over  $S0.  Tlio 
parties  would  not  have  made  tlie  conti'aot  of 
sale  except  upon  the  understandinj;  and  be- 
lief that  slie  was  incapable  of  brecvlinj;,  and 
of  no  use  as  a  cow.  It  is  true  slie  is  now 
the  identical  animal  that  they  thouj^ht  her 
to  be  when  the  contract  was  made;  there  is 
no  mistake  as  to  the  identity  of  the  creature. 
Yet  tlie  mistake  was  not  of  the  mei-e  <iuality 
of  the  animal,  but  Avent  to  the  verj-  nature 
of  the  thinj;.  A  barren  cow  is  suV)stantially 
a  dilferent  creature  than  a  breeding  one. 
There  is  as  much  difference  between  them 
for  all  purposes  of  use  as  there  is  between 
an  ox  and  a  cow  that  is  capable  of  breeding 
and  giving  milk.  If  the  mutual  mistake  had 
simply  related  to  the  fact  whether  she  w:is 
with  calf  or  not  for  one  season,  then  it  might 
have  been  a  good  sale,  but  the  mistake  af- 
fected the  character  of  the  animal  for  all 
time,  and  for  her  present  and  idtimate  use. 
She  was  not  in  fact  the  animal,  or  the  kind 
of  animal  the  defendants  intended  to  sell  or 
the  plaintiff  to  buy.  She  was  not  a  barren 
cow,  and,  if  this  fact  had  been  known,  there 
would  have  been  no  contract.    The  mistake 


affected  the  substance  of  the  whol««  consid- 
eration, and  it  must  be  considered  tliiit 
there  was  no  contract  to  sell  or  sale  of  the 
cow  as  she  a<tually  was.  The  thing  sold 
and  bought  had  in  fact  no  existence.  She 
was  sold  as  a  beef  creature  would  be  s<t!d; 
she  is  in  fact  a  breeding  cow,  antl  a  valua- 
ble one.  The  court  should  have  insti-ucted 
the  jury  that  if  they  found  tliat  the  cow 
was  sold,  or  contra<-ted  to  be  sold,  upon  the 
understanding  of  both  parties  tliat  she  was 
barren,  and  useless  for  the  purpose  of 
breeding,  and  that  in  fact  she  was  not  bar- 
ren, but  capable  of  breeding,  then  the  de- 
fendants had  a  right  to  rescind,  and  to  re- 
fuse to  deliver,  and  the  verdict  should  be  in 
their  favor. 

The  judgment  of  the  court  below  nnist  be 
reversed,  and  a  new  trial  granted,  with  cost.s 
of  this  court  to  defendants. 

CAMPBELL,  C.  J.,  and  CHAMI'LIX,  J., 
concurred. 

SHERWOOD,  J.,  delivered  a  dissenting 
opinion. 


110 


MISTAKE. 


RODLIFF  et  al.  v.  DALLIXGER. 

(4  N.  E.  805,  141  Mass.  1.) 

Supreme  Judicial   Court   of   Massacliusetts. 
Suffolk.    .Ian.   11,    IKSii. 

E.YOoptions  from  supprior  court.  SulTolk  coun- 
ty;   Kiiowlton,  .TudjJTc. 

This  was  au  action  of  rciileviu  to  ivcover 
po.ssossiou  of  20  ba^s  of  California  wool,  'ilie 
plaintiffs  were  wool  dealers  in  Boston,  and  on 
or  about  Xovenibei  15,  18S2,  delivered  said  wool 
to  one  Henry  Cleiuentsou,  a  wool  dealer  and 
bi-oker  in  Boston.  Tlie  defendant  was  a  public 
warehouseman  in  Bo.ston.  and  received  the 
wool  on  storage  from  Clementson  about  Novem- 
ber 15,  1S82,  not  knowing  where  he  obtained 
It,  and  IssutHl  a  warehouse  receipt  for  the  same 
on  the  day  after  the  delivery  of  the  wool. 
Clementson  applied  to  the  Massachusetts  Loan 
iV:  Trust  Company,  ot  Boston,  for  a  loan  of  .?2,- 
000  on  the  wool  in  the  warehouse,  and,  after 
au  examination  of  the  article,  the  loan  was 
made;  tlie  trust  company  taking  the  warehouse 
re<'eipt  fi-om  Clementson,  having  no  knowl- 
edge where  Clemer.tson  obtained  the  wool,  hi.s 
statement  being  that  he  purchasetl  the  wool  to 
sell;  and  the  trust  company,  being  the  real 
partj-  in  interest,  defended  the  suit. 

Upon  the  foregoing  facts  the  court  instructed 
the  jury  that  there  were  three  iMssible  views 
of  the  transaction:  (1)  That  they  might  find 
it  was  an  ordinaiy  sale  to  Clementson;  or  (2) 
that  it  was  not  a  sale  to  Clementson,  but  was 
a  deliveiy  to  Clementson  as  a  broker,  with  a 
view  to  his  selling  it  to  some  customer,  whom 
he  expected  afterwards  to  negotiate  with,  and 
with  whom  to  consummate  a  sale;  and  if  they 
found  this,  then  there  was  a  special  provision 
of  the  statute  which  protects  parties  dealing  in 
good  faith  with  a  broker  having  property  in 
that  way,  so  far  as  tliey  make  advances  oi 
loans  upon  property  in  pledge,  in  good  faith,  to 
persons  who  have  custody  of  property  as  bro- 
kers, with  authority  to  sell  or  dispose  of  it; 
or  (3)  that  it  was  not  a  sale  to  Clementson, 
or  a  deliveiy  to  him  as  broker  with  authority 
to  sell,  but  that  it  was  a  deliveiy  to  Clement- 
son upon  his  repi'esentation  that  he  came  from 
a  purchaser  representing  liim,  with  an  offer  for 
it,— a  purcliaser  lie  did  not  disclose,— and  that 
these  goods  were  delivered  to  him  as  the  agent 
of  tliat  purchaser,— as  a  .sale  to  that  purchaser; 
and  if  that  was  the  fact,  tliat  the  plaintiffs 
were  entitled  to  the  property,  notwithstanding 
it  was  subsequently  pledged  to  the  Massachu- 
setts Loan  &  Trust  Company. 

The  court  also  further  instructed  the  jury 
ui)on  the  third  view  "that  if  this  was  a  trans- 
fer uix)n  a  false  representation  made  by  Clem- 
entson,—a  representation  that  he  came  with 
an  offer  from  a  third  person  whose  name  he 
did  not  wish  to  disclose,— and  tlie  goods  were 
delivered  to  Clementson  as  a  sale  to  him  as  the 
agent  of  this  third  person,  whose  offer  he  was 
bearing,  with  the  view  that  the  propeitj'  should 
pa.ss  at  the  time  to  that  third  person,  and  thus 
constitute  a  sale  to  that  third  person,  from 
whom  payment  was  to  be  made  subsequently, 


and  the  payment  to  be  brought  back  by  Clem- 
entson as  the  agent  of  that  third  person,  that 
Clementson  had  no  right  afterwanis  to  deal 
with  that  property  at  all.  He  got  it  into  his 
yoss(Jssi(in  by  fraud,  and  he  got  it  into  his 
possession  without  any  authority  to  make  any 
subse(]uent  sale  or  to  do  anything  with  it.  It 
^vas  wrongly  in  his  possession  from  the  start, 
and  an  J-  person  who  saw  fit  to  advance  money 
upon  it  or  to  buy  it,  however  honestly,  and 
in  perfect  good  faith,  would  be  the  loser,  and 
plaintiffs  could  pursue  the  property,  and  get  it 
wherever  they  could  find  it,  whenever  the  fraud 
practiced  ujotu  them  should  come  to  their 
knowledge." 

Ui)on  the  foregoing  facts  and  rulings,  the  jury- 
found  for  the  plaintiffs,  and  the  defendant, 
having  duly  excepted  to  the  third  instruction  of 
the  court,  being  so  much  of  the  judge's  rulings 
as  authorized  the  juiy  to  find  for  the  plaintiffs, 
prays  that  these  his  exceptions  to  said  rulings 
luay  be  allowed. 

Alfred  Hemenway,  for  plaintiffs.  Henrj'  D. 
Hyde,  for  defendant. 

HOLMES,  .7.  The  plaintiffs'  evidence  war- 
ranted the  conclusion  tliat  they  refused  to  sell 
to  Clementson,  the  broker,  bur  delivered  the 
wool  to  hit  a  on  the  understanding  tliat  it  was 
sold  to  an  undisclosed  manufacturer  in  good 
credit  with  plaintiffs.  This  evidence  was  not 
objected  to,  and  was  admissible,  notwithstand- 
ing the  fact  that  the  sale  was  entered  on  the 
plaintiff's"  books  as  a  sale  to  Clementson,  and 
that  a  bill  was  made  to  him.  Com.  v.  Jeffries,. 
7  Allen,  54S,  5G4.  It  was  admitted  that  Clem- 
entson in  fact  was  not  acting  for  such  an  un- 
disclosed principal,  and  it  follows  that,  if  the 
plaintiff's'  evidence  was  believed,  there  was  nf> 
sale.  There  could  not  be  one  to  the  supposed 
principal,  because  there  was  no  such  pers-on; 
and  there  was  not  one  to  Clementson,  because 
none  puiported  to  be  made  to  him;  but,  on  the 
contrary,  such  a  sale  was  expressly  refustd, 
and  excluded.  Edmunds  v.  Transportation  Co., 
135  Mass.  283. 

It  was  suggested  that  this  case  differed  from 
the  one  cited,  because  there  the  principal  was 
disclosed,  whereas  here  he  was  not,  and  that 
credit  could  not  be  supposed  to  have  been  giv- 
en to  au  unknown  person.  We  have  nothing 
to  say  as  to  the  weight  which  this  argiuuent 
ought  to  have  with  a  jury,  beyond  observing 
that  the  plaintiff's  had  reason,  in  Clementson's 
representations,  for  giving  credit  to  the  sup- 
posed manufacturer.  But  there  is  no  rule  of  law 
that  makes  it  impossible  to  contract  with  or  sell 
to  an  unknown  but  existing  party,  and  if  the 
jury  find  that  sucn  a  sale  was  the  only  one  that 
puiporttd  to  have  been  made,  the  fact  that  it 
failod  does  uot  turn  it  into  a  sale  to  the  party 
conducting  the  transjiction. 

Schmaltz  v.  Averj',  IG  Q.  B.  (^55.  only  decid- 
ed that  a  man's  describing  liimself  in  a  char- 
ter-party as  "agent  of  the  freigliter"  is  not 
sufficient  to  preclude  him  from  alleging  that  he 
is  the  freighter.  It  does  not  hint  that  the 
agent  could  uot  be  excluded  by  express  terms^ 


MISTAKE. 


Ill 


or  by  the  description  of  tbc  principal,  althoujj;h 
iusutticient  to  identify  the  individual  dealt  with, 
as  happened  here;  still  less,  that,  in  favor  of 
third  persons,  the  atrent  woidd  be  presumed, 
without  evidence,  to  be  the  undisclosed  princi- 
pal, althouf,di  expressly  excluded. 

The  invalidity  of  the  transaction  in  tlie  case 
at  bar  does  not  depend  upon  frjuid,  but  upon 
the  fact  that  one  of  the  supposed  parties  is 
wantiufj.  it  does  not  matter  how.  Fniud  only  ; 
becomes  important,  as  such,  when  a  sale  or  con- 
tract is  complete  in  its  formal  elements,  and  i 
therefore  valid  unless  repudiated,  but  the  risht 
is  claimed  to  rescind  it.  It  goes  to  the  mo- 
tives for  making  the  contract,  not  to  its  exist- 
ence; as,  when  a  vendee  expressly  or  implied- 
ly represents  that  he  is  solvent,  and  intends  to 
pay  for  goods,  when  in  fact  he  is  insolvent,  and 
has  no  reasonable  expectation  of  paying  for 
them;  or,  being  ideutitied  liy  the  senses,  and 
dealt  with  as  the  person  so  identified,  says  that 


he  Ls  A.  when  in  fact  he  is  B.  But  when  one 
of  the  fonnal  constituents  of  illegal  transac- 
tions is  wanting,  there  is  no  question  of  rescis- 
sion,—the  ti-aiLsactioD  is  void  ab  initio,— and 
fraud  does  not  impart  to  it,  against  the  will  of 
the  defrauded  party,  a  validity  that  it  would 
not  liave  if  the  want  were  due  to  innocent  mi.s- 
take.  The  sale  being  void,  and  not  merely 
voidable,  or,  in  simpler  words,  there  hjiving 
been  no  sale,  the  deliveiy  to  (.'lementson  gave 
him  no  iK)wer  to  conve.v  a  good  title  to  a  bona 
fide  purcliaser.  He  had  not  even  a  defective 
title,  and  his  mere  possession  did  not  enable 
him  to  pledge  or  mortgage.  The  considera- 
tions in  favor  of  prottnting  bona  fide  dejilers 
with  persons  in  iwssession,  in  cases  like  the 
present,  were  much  urged  in  Tliacher  v.  Moors, 
134  Mass.  lofj,  but  did  not  prevail.  Much  les.s 
can  it  be  allowed  to  prevail  against  a  legal  title 
without  the  inteiTention  of  statute.  Excep- 
tions overniled. 


112 


MISTAKE. 


in  I'!  i:V   <t   al.   V.  DACHETT. 

iTi  III.  :!r.i.i 

Siipn'tm-  C't'iui  ol"  llliiiuis.  St'i)l.  Ti-nu,  1874. 
IN'pl'-vlii  tiroiiKlit  l>y  .loliii  V.  Da^Kt'tt 
im.-iliisi  Aluiiiii  Kiiplr.v  iiiitl  .lacoli  Kupli-y  to 
n'«'i>v«'r  a  iiiiiiv  wliirli  tlic  (It'toiulaiiis  claiiii- 
»'«l  tli»».v  hail  iMHi^rht  ol'  tin'  plaiiilill.  At  tlu' 
tlrxt  coiivtTsatidii  aliiuit  tlic  iiiaif.  Kiijilcy 
ask«Ml  iIm-  i>rlr»'.  Ilic  plainlifl"  s\vi'ariii«  that 
Ih'  rcplltMl  !!!H;.-..  whih-  llu«  (h'TciKhiiit  Icsti- 
Mt-)!  lluit  1h>  said  $<'.•'>.  In  I  ho  sccoiul  t'on- 
v«>rsath>ii  Knph'v  says  ht>  lold  Da«K«'tt  that, 
if  th««  ma IV  was  as  n-pn'sculcd.  tiu-y  woukl 
flivc  ?th"».  and  I)a^'j;»'tt  said  lie  woiihl  take 
Idin  down  n««xl  niorninp  to  see  hvv.  l)afrK«"tt 
tfstitird  tliat  Kiiph-y  said  to  him.  "Did  I 
uinlcrstand  yon  sixty-liveV"  and  that  he  sup- 
posed Uni»h>y  refen-ed  to  tlie  fraction  of  the 
?1(H).  and  meant  $!»;.".  as  named  at  the  prevl- 
<ins  interview.  lie  answeied.  "Yes,  sixty- 
tive."  Kotli  p;irties  tlien  snpposed  the  price 
was  fixed,  Knph'y  snpposinfr  it  was  .$t!.l,  and 
Dajrjrett  snpposinj;  it  wjis  !?l»i"».  The  next 
ihiy  Iluph'y  saw  the  mare,  and  took  her 
home.  .Tndpmeqt  for  phiintiff,  and  defend- 
ants appeah'd. 

I'ellows  &  Leonard,  for  appellants.  Hill 
A:    Diliell.   for  appellee. 

SCOTT.  J.  It  is  very  clear,  from  the  evi- 
dence in  this  case,  there  was  no  sale  of  the 
property  understandiugly  made.  Appellee 
snpposed  he  was  selling  for  $105,  and  it  may 
he  a|)peUant  was  eqnally  honest  in  the  belief 
that  he  was  bnying  at  the  price  of  $<)."). 
Tliere  is,  however,  some  evidence  tending  to 
sliow  that  api)ellant  Uupley  did  not  act  with 
entin-  good  faith.  He  was  told,  before  he 
removed  the  mare  from  appellee's  farm, 
there  mnst  be  some  mistake  as  to  the  price 
lie  was  to  i»a,v  for  her.  There  is  no  dispute 
this  information  was  given  to  him.  He  in- 
sisted, however,  the  price  was  $(»5,  and  ex- 
pressed his  belief  he  would  keep  her  if  there 
was  a  mistake.  On  his  way  home  with  the 
.nijire  In    his  po.ssession,    he   met   appellant, 


but  never  intimated  to  him  he  had  been 
told  there  might  be  a  misunderstanding  as 
to  the  price  he  was  to  pay  for  her.  This 
he  ought  to  have  done,  so  that,  if  there  had 
been  a  misunderstanding  between  them,  it 
could  be  corrected  at  once.  If  the  price  was 
to  be  $105,  he  had  never  agreed  to  pay  that 
sum.  and  was  under  no  sort  of  obligation 
to  keep  the  property  at  that  price.  It  was 
his  i)rivilege  to  return  it.  On  the  contrary, 
api>ellee  had  never  agreed  to  sell  for  $05, 
and  could  not  be  compelled  to  part  with 
liis  property  for  a  less  sum  tlian  he  chose  to 
ask.  It  is  according  to  natural  justice, 
where  there  is  a  mutual  mistake  in  regard 
to  the  price  of  an  article  of  property,  there 
is  no  sale,  and  neither  party  is  bound.  There 
has  l)een  no  meeting  of  the  minds  of  the 
contracting  parties,  and  hence  there  can  be' 
no  sale.  This  principle  is  so  elementary  it 
needs  no  citation  of  authorities  in  its  sup- 
port. Any  otlier  rule  would  work  injustice 
and  might  compel  a  person  to  part  Avitli  his 
property  without  his  consent,  or  to  talve  and 
pay  for  property  at  a  price  he  had  never 
contracted  to  pay. 

There  was  no  error  in  refusing  instruc- 
tions asked  by  appellants.  The  court  was 
asked  to  tell  the  jury  if  they  believed,  from 
the  evidence,  appellee  had  "sworn  willfully 
and  corruptly  false  in  any  material  portion 
of  his  testimony,  then  they  are  at  liberty  to 
disregard  his  entire  testimony,  except  so  far 
as  it  may  be  corroborated  by  other  evidence 
in  the  ca.se."  Ck)nceding  this  instruction 
states  a  correct  aljstract  principle  of  law, 
there  was  no  necessity  for  giving  it  under 
the  facts  proven  in  this  case.  The  verdict 
was  right,  and  appellants  were  not  preju- 
diced by  the  refusal  of  the  court  to  give  it. 

All  that  was  pertinent  to  tlie  issues  in  the 
other  refused  instructions  was  contained  in 
others  that  were  given,  and  tliere  was  no 
necessity  for  repeating  it. 

No  material  error  appearing  in  the  record, 
the  judgment   must  be  affirmed. 

Judgment  attirmed. 


whp:x  title  passes. 


lis 


HAKKNESS  v.  RISSELL  k  CO. 

(7  Sup.  Ct.  51.  118  U.  S.  <J(!3.) 

Supreme  Court  of  the   United  States.     Nov.   8, 
l.SS(i. 

Appeal  from  the  supreiue  euurt  of  the  ter- 
ritory of  Utah. 

The  facts  fully  appear  in  the  following 
stateineut  by  Mr.  .lustiee  BRADLEY: 

This  was  au  appeal  from  the  supreme 
court  of  Utah.  The  action  was  brouglit  in 
the  district  court  for  Weber  county,  to  re- 
cover the  value  of  two  steam-engines  and 
boilers,  and  a  portable  saw-mill  connected 
with  each  enj,Mne.  A  jury  being  waived,  the 
court  found  the  facts,  and  rendered  judg- 
ment for  the  plaintiff,  Russell  &  Co.  The 
plaintiff  is  an  Ohio  corporation,  and  by  its 
agent  in  Idaho,  on  the  second  of  October, 
1882.  agreed  with  a  partnership  firm  by  the 
name  of  Phelan  &  Ferguson,  residents  of 
Idaho,  to  sell  to  them  the  said  engines,  boil- 
ers, and  saw-mills  for  the  price  of  .$4,988, 
nearly  all  of  which  was  secured  bj'  certain 
promissory  notes,  which  severally  contained 
the  terms  of  the  agreement  between  the  par- 
ties. One  of  the  notes  (the  others  being  in 
the  same  form)  was  as  follows,  to-wit: 
"Salt  Lake  City,  October  2.  1882.  On  or  be- 
fore the  first  day  of  May,  1883,  for  value  re- 
ceived in  one  sixteen-horse  portable  engine. 
No.  1,026,  and  one  portable  saw-mill,  No. 
128,  all  complete,  bought  of  L.  B.  Mattison, 
agent  of  Russell  &  Co.,  we,  or  either  of  us. 
promise  to  pay  to  the  order  of  Russell  tfc 
Co.,  Massillou,  Ohio,  $300,  payable  at  Wells, 
Fargo  &  Co.'s  bank.  Salt  Lake  City,  Utah 
Territory,  with  ten  per  cent,  interest  per  an- 
num from  October  1,  1882,  until  paid,  and 
reasonable  attornej^'s  fees,  or  any  costs  that 
may  be  paid  or  incurred  in  any  action  or  pro- 
ceeding instituted  for  the  collection  of  this 
note  or  enforcement  of  this  covenant.  The 
express  condition  of  this  transaction  is  such 
that  the  iitie,  ownership,  or  possession  of 
said  engine  and  saw-mill  does  not  pass  from 
the  .said  Russell  &.  Co.  until  this  note  and  in- 
terest shall  have  been  paid  in  full,  and  the 
said  Russell  &  Co.  or  his  agent  has  full  pow- 
er to  declare  this  note  due,  and  take  posses- 
sion of  said  engine  and  saw-mill  when  they 
may  deem  themselves  insecure  even  before 
the  maturity  of  this  note:  and  it  is  further 
agreed  by  the  makers  hereof  that  if  said 
note  is  not  paid  at  maturity,  that  the  interest 
shall  be  two  per  cent,  per  month  from  ma- 
turity hereof  till  paid,  both  before  and  after 
judgment,  if  any  should  be  rendered.  In 
case  said  saw-mill  and  engine  shall  be  taken 
back,  Russell  &  Co.  may  sell  the  same  at 
public  or  private  .sale  withotit  notice,  or  they 
may,  without  sale,  indorse  the  true  value  of 
the  property  on  this  note,  and  we  agree  to 
pay  on  the  note  any  balance  due  thereon, 
after  such  indorsement,  as  damages  and 
rental  for  .said  machinery.  As  to  this  debt 
we  waive  the  right  to  exempt,  or  claim  as 
exempt,  any  property,  real  or  personal,  we 

VAX  ZILE  SEL.C.VS.SALES— 8 


now  own,  or  may  hereafter  acquire,  by  vir- 
tue of  any  homestead  or  exemption  law, 
state  or  federal,  now  in  force,  or  that  here- 
after may  be  ena"ted.  P.  O.,  Oxford,  Oneida 
County,  Idaho  territory.  $300.  Phelan  & 
Ferguson."  Some  of  the  notes  were  given 
for  the  price  of  one  of  the  engines  with  its 
accompanying  boiler  and  mill,  and  the  others 
for  the  price  of  the  other.  Some  of  the  notes 
were  paid;  and  the  present  suit  was  brought 
on  those  that  were  not  paid.  The  property 
^^as  delivered  to  Phelan  &  Fergu.son  on  the 
execution  of  the  notes,  and  subsequentlj- 
they  sold  it  to  the  defendant  Ilarkness,  in 
part  payment  of  a  debt  due  from  them  to 
him  and  one  Langsdorf.  The  defendant,  at 
the  time  of  the  sale  to  him.  knew  that  the 
purchase  price  of  the  property  had  not  been 
paid  to  the  plaintiff,  and  that  the  plaintiff 
claimed  title  thereto  until  such  payment  was 
made.  The  unpaid  notes  given  for  each  en- 
gine and  mill  exceeded  in  amount  the  value 
of  such  engine  and  mill  when  the  action  was 
commenced. 

The  territory  of  Idaho  has  a  law  relating 
to  chattel    mortgages    [act    of    January    12, 
1875],    requiring  that   every   such   mortgage 
shall  set  out  certain  partictilars  as  to  par- 
ties, time,  amount,  etc.,  with  an  affidavit  at- 
tached that  it  is  bona  fide,  and  made  with- 
i  out  any  design  to  defraud  and  dela.v  cred- 
'  itors;    and  requiring  the  mortgage  and  affi- 
davit to  be  recorded  in  the  county  where  the 
mortgagor  lives,  and  in  that  where  the  prop- 
:  erty  is  located;    and  it  is  declared  that  no 
i  chattel   mortgage  shall  be  valid  (except   as 
j  between   the  parties   thereto)   without   com- 
pliance   with    these     reqtiisites,    unless   the 
mortgagee   shall  have  actual   possession   of 
the  property  mortgaged.    In  the  present  case 
no  affidavit  was  attached  to  the  notes,   nor 
were  they  recorded. 

The  court  found  that  it  was  the  intention 
of  Phelan  &  Ferguson  and  of  Russell  & 
Co.  that  the  title  to  the  said  property  should 
not  pass  from  Russell  &  Co.  until  all  the 
notes  were  paid.  Upon  these  facts  the  court 
found,  as  conclusions  of  law,  that  the  trans- 
action between  Phelan  &  Ferguson  and  Rus- 
sell &  Co.  was  a  conditional  or  exectitory 
sale,  and  not  an  absolute  .'^ale  with  a  lien 
reserved,  and  that  the  title  did  not  pass  to 
Phelan  &  Ferguson,  or  from  them  to  the  de- 
fendant, and  gave  judgment  for  the  plain- 
tiff. The  supreme  court  of  the  territory  af- 
firmed this  judgment.  7  Pac.  805.  This  ap- 
peal was  taken  from  that  judgment. 

Parley  L.  Williams,  (.lames  X.  Kimball  and 
Abbot  R.  Heywood,  on  the  brief,)  for  appel- 
lant.   Charles  W.  Bennett,  for  appellee. 

Mr.  Justice  BRADLEY,  after  .stating  the 
facts  as  above  reported,  delivered  the  opin- 
ion of  the  court. 

The  first  question  to  be  considered  is 
whether  the  transaction  in  question  was  a 
conditional    sale    or    a    mortgage;    that  is, 


114 


WHEN   TITLE  PASSES. 


whether  it  was  a  mere  af?reeiiient  to  sell  up- 
on a  coudilion  to  bo  performed,  or  an  abso- 
lute sale,  with  a  reservation  of  a  lien  or 
mortjrajie  to  secure  the  purchase  money.  If 
it  was  the  latter,  it  is  conceded  that  the  lieu 
or  mortj^age  was  void  as  against  third  per- 
sons, because  not  verified  by  atiidavit,  and 
not  recorded  as  required  by  the  law  of  Ida- 
lio.  But,  so  far  as  words  and  the  express  in- 
tent of  the  parties  can  go,  it  is  perfectly  evi- 
dent that  it  was  not  an  absolute  sale,  but 
only  an  agreement  to  sell  upon  condition 
that  the  purchasers  should  pay  their  notes 
at  maturity.  The  language  is:  "The  express 
condition  of  this  transaction  is  such  that  the 
title  *  *  *  does  not  pass  *  *  *  until 
this  note  and  interest  shall  have  been  paid 
in  full."  If  the  vendees  should  fail  in  this 
or  if  the  vendors  should  deem  themselves  in- 
secure before  the  maturity  of  the  notes,  the 
latter  were  authorized  to  repossess  them- 
selves of  the  machinery,  and  credit  the  then 
value  of  it,  or  the  proceeds  of  it  if  they 
should  sell  it,  upon  the  iinpaid  notes.  If 
this  did  not  pay  the  notes,  the  balance  was 
still  to  be  paid  by  the  makers  by  way  of 
"damages  and  rental  for  said  machinery." 
This  stipulation  was  strictly  in  accordance 
with  the  rule  of  damages  in  such  eases.  Up- 
on an  agreement  to  sell,  if  the  purchaser 
fails  to  execute  his  contract,  the  true  meas- 
ure of  damages  for  its  breach  is  the  differ- 
ence between  the  price  of  the  goods  agreed 
on  and  their  value  at  the  time  of  the  breach 
or  trial,  which  may  fairly  be  stipulated  to 
be  the  price  they  bring  on  a  resale.  It  can- 
not be  said,  therefore,  that  the  stipulations 
of  the  contract  were  inconsistent  with  or  re- 
pugnant to  what  the  parties  declared  their 
intention  to  be,  namely,  to  make  an  ex- 
ecutory and  conditional  contract  of  sale. 
Such  contracts  are  well  known  in  the  law 
and  often  recognized;  and,  when  free  from 
any  fraudulent  intent,  are  not  repugnant  to 
any  principle  of  justice  or  equity,  even 
though  possession  of  the  property  be  given 
to  the  proposed  purchaser.  The  rule  is  for- 
mulated in  the  text-books  and  in  many  ad- 
judged cases. 

In  Lord  Blackburn's  Treatise  on  the  Con- 
tract of  Sale,  published  40  years  ago,  two 
rules  are  laid  down  as  established.  (1)  That 
where,  by  the  agreement,  the  vendor  is  to  do 
anything  to  the  goods  before  delivery,  it  is  a 
condition  precedent  to  the  vesting  of  the 
property;  (2)  that  where  anything  remains 
to  be  done  to  the  goods  for  ascertaining  the 
price,  such  as  weighing,  testing,  etc.,  this  is 
a  condition  precedent  to  the  transfer  of  the 
property.  Blackb.  Sales.  152.  And  it  is  sub- 
sequently added  that  "the  parties  may  indi- 
cate an  intention,  by  their  agreement,  to 
make  any  condition  precedent  to  the  vesting 
of  the  pro])erty;  and,  if  they  do  so,  their  in- 
tention is  fulfilled."    Blackb.  Sales,  Itil. 

Mr.  Benjamin,  in  his  Treatise  on  Sales  of 
Personal  I^roperty.  adds  to  the  two  formu- 
lated rules  of  Lord  Blackburn  a  third  rule, 


which  is  supported  by  many  authorities,  to- 
wit:  (3)  "Where  the  buyer  is  by  the  con- 
tract bound  to  do  anything  as  a  condition, 
either  precedent  or  concurrent,  on  which  the 
passing  of  the  property  depends,  the  prop- 
erty will  not  pass  until  the  condition  be  ful- 
tilled,  even  though  the  goods  maj'  have  been 
actuall.v  delivered  into  the  possession  of  the 
buyer."  Benj.  Sales  (2d  Ed.)  23(j;  Id.  (3d 
Ed.)  §  320.  The  author  cites  for  this  propo- 
sition Bishop  V.  Stillito,  2  Barn.  &  Aid.  320, 
note  a;  Brandt  v.  Bov.iby,  2  Barn.  &  Adol. 
932;  Barrow  v.  Coles  (Lord  Ellenborough)  3 
Camp.  02;  Swain  v.  Shepherd  (Baron 
Parke)  1  Moody  vt  R.  223;  Mires  v.  Solebay, 
2  Mod.  243. 

In  the  last  case,  decided  in  the  time  of 
Charles  II.,  one  Alston  took  sheep  to  pas- 
ture for  a  certain  time,  with  an  agreement 
that  if,  at  the  end  of  that  time,  he  should 
pay  the  owner  a  certain  sum,  he  should  have 
the  sheep.  Before  the  time  expired  the  own- 
er sold  them  to  anotlier  person;  and  it  was 
held  that  the  sale  was  valid,  and  that  the 
agreement  to  sell  the  sheep  to  Alston,  if  he 
would  pa}'  for  them  at  a  certain  day,  did  not 
amount  to  a  sale,  but  only  to  an  agreement. 
The  other  cases  were  instances  of  sales  of 
goods  to  be  paid  for  in  cash  or  securities  on 
delivery.  It  was  held  that  the  sales  Avere 
conditional  only,  and  that  the  vendors  were 
entitled  to  retake  the  goods,  even  after  de-' 
livery,  if  the  condition  was  not  performed; 
the  delivery  being  considered  as  conditional. 
This  often  happens  in  cases  of  sales  by  auc- 
tion, when  certain  terms  of  payment  are  pre- 
scribed, with  a  condition  that,  if  they  are 
not  complied  with,  the  goods  may  be  resold 
for  account  of  the  buyer,  who  is  to  account 
for  any  deficiency  between  the  second  sale 
and  the  first.  Such  v.'as  the  case  of  Lamond 
V.  Duvall,  9  Q.  B.  1030;  and  many  more 
cases  could  be  cited. 

In  Ex  parte  Crawcour,  L.  R.  9  Ch.  Div. 
419,  certain  furniture  dealers  let  Robertson 
have  a  lot  of  furniture  upon  his  paying  £10. 
in  cash  and  signing  an  agreement  to  pay  £.3 
per  month  (for  which  notes  were  given)  un- 
til the  whole  price  of  the  furniture  should  be 
paid;  and  when  all  the  installments  were 
paid,  and  not  before,  the  furniture  was  to  be 
the  property  of  Robertson;  but.  if  he  failed 
to  pay  any  of  the  installiuents,  the  owners 
were  authorized  to  take  possession  of  the 
property,  and  all  prior  payments  actually 
made  were  to  be  forfeited.  The  court  of  ap- 
peals held  that  the  property  did  not  pass  by 
this  agi'oement,  and  could  not  be  taken  as 
Robertson's  propert.v  l)y  his  trustee  under  a 
liquidation  proceeding.  The  same  conclu- 
sion was  reached  in  the  subsequent  case  of 
Crawcour  v.  Salter,  L.  R.  18  Ch.  Div.  30. 

In  these  cases,  it  is  ti'ue.  support  of  the 
transaction  was  sought  from  a  custom 
which  prevails  in  the  places  where  the  trans- 
actions took  place,  of  hotel-keepers  holding 
their  furniture  on  hire.  But  they  show  That 
the  intent  of  the  parties  will  be  recognized 


WHEN   TITLE  PASSES. 


Ill 


and  sanctioned  where  it  is  not  contrary  to 
the  polify  of  the  law.  This  policy,  in  Eng- 
land, is  declared  by  statute.  It  has  long 
been  a  provision  of  the  Englisli  bankrupt 
laws,  beginning  with  21  Jac.  I.  c.  19,  that  if 
any  person  becoming  bankrupt  has  in  his 
possession,  order,  or  disi)()siti()n.  by  consent 
of  the  owner,  any  goods  or  chattels  of  which 
he  is  the  reputed  owner,  or  takes  upon  him- 
self the  sale,  alteration,  or  disposition  there- 
of as  owner,  such  goods  are  to  be  sold  for 
the  benefit  of  his  creditors.  Tliis  law  has 
had  the  effect  of  preventing  or  defeating  con- 
ditional sales  accompanied  by  voluntary  de- 
livery of  possession,  except  in  cases  like 
those  before  referred  to;  so  that  very  few 
decisions  are  to  be  found  in  the  English 
books  directly  in  point  on  the  question  under 
consideration.  The  following  case  presents 
a  fair  illustration  of  the  English  law  as 
based  upon  the  statutes  of  bankruptcy.  In 
Horn  V.  Baker.  9  East,  21;j.  the  owner  of  a 
term  in  a  distillery,  and  of  the  apparatus 
and  utensils  employed  therein,  demised  the 
sa)ne  to  J.  &  S.  in  consideration  of  an  an- 
nuity to  be  paid  to  the  owner  and  his  wife 
during  their  several  lives,  and  upon  their 
death  the  lessees  to  hav^  the  liberty  of 
purchasing  the  residue  of  the  term,  and  the 
apparatus  and  utensils,  with  a  proviso  for 
re-entry  if  the  annuity  should  at  any  time  be 
two  moutlis  in  arrear.  The  annuity  having 
become  in  arrear  for  that  period,  instead  of 
making  entry  for  condition  broken,  the  wife 
and  administrator  of  the  owner  brought  suit 
to  recover  the  arrears,  which  was  stopped 
by  the  bankrupt<'y  of  J.  &  S.  The  cpiestion 
then  arose  whether  the  utensils  passed  to 
the  assignees  of  J.  &  S.  under  the  bankrupt 
act,  as  being  in  their  possession,  order,  and 
disposition  as  reputed  owners;  and  the  court 
lield  that  they  did;  but  that,  if  there  had 
been  a  usage  in  the  trade  of  letting  utensils 
with  a  distillery,  the  case  would  have  admit- 
ted a  different  consideration,  since  such  a  \ 
custom  might  have  rebutted  the  presumption 
of  ownersliip  arising  from  the  possession 
and  apparent  order  and  disposition  of  the 
goods.  This  case  was  followed  in  Holroyd 
v.  Gw.ynne.  2  Taunt.  17(5. 

This  presumption  of  property  in  a  bank- 
rupt arising  from  his  possession  and  reputed 
ownership  became  so  deeply  imbedded  in  the 
English  law  that  in  process  of  time  many  per- 
sons in  the  profession,  not  adverting  to  its 
origin  in  the  statute  of  bankrujitcy.  were  led 
to  regard  it  as  a  doctrine  of  the  common  law; 
and  hence  in  some  states  in  this  country, 
where  no  such  statute  exists,  the  princijiles  of 
the  statute  have  been  followed,  and  cdudi- 
tional  sales  of  tlie  kind  now  under  considera- 
tion have  been  condemned  either  as  being 
fraudulent  and  void  as  against  creditors,  or  as 
amounting,  in  effect,  to  absolute  sales  with  a 
reserved  lien  or  mortgage  to  sec-ure  the  pay- 
ment of  the  purchase  money.  This  view  is 
based  on  the  notion  that  such  sales  are  not  al- 
lowed l)y  law,  and  that  the  intent  of  the  par- 


ties, however  hc^nestly  formed,  cannot  legally 
be  carried  out.  The  insutticiency  of  this  argu- 
ment is  demonstrated  by  the  fact  that  condi- 
tional sales  are  admissible  in  several  acknowl- 
edged cases,  and  therefore  there  cannot  be 
any  rule  <jf  law  against  them  as  such.  They 
may  .sometimes  be  used  as  a  cover  for  fraud; 
and,  when  this  is  charged,  all  the  circum- 
stances of  the  case,  this  included,  will  be 
open  for  the  consideration  of  a  jury.  AN'here 
no  fraud  is  intended,  liut  tlie  honest  purpose 
of  the  parties  is  that  the  vendee  shall  not 
have  the  ownership  of  the  goods  imtil  he  has 
paid  for  them,  there  is  no  general  principle  of 
law  to  prevent  their  purpose  from  having 
effect. 

In  this  country,  in  states  where  no  such 
statute  as  the  English  act  refericd  to  is  in 
force,  many  decisions  have  been  rendered  sus- 
taining conditional  .sales  accompanied  by  deliv- 
ery of  possession,  both  as  betwi'en  tlie  parties 
themselves  and  as  to  third  persons. 

In  Hussey  v.  Thornton,  4  .Mass.  404  (decided 
in  1S1)8),  where  goods  Avere  delivered  on  board 
of  a  vessel  for  the  vendee  upon  an  agreement 
for  a  sale,  sul).iect  to  the  condition  that  the 
goods  should  remain  the  property  of  the  ven- 
dors until  they  received  security  for  payment, 
it  was  held  (Chief  Ju.stice  I'arsous  delivering 
the  opinion)  that  the  property  did  not  pass, 
and  that  the  goods  could  not  be  attached  by 
the  creditors  of  the  vendee. 

This  case  was  followed  in  1822  by  that  of 
Marston  v.  Baldwin,  17  Mass.  (JUIJ.  which 
was  replevin  against  a  sheriff  for  taking  goods 
which  the  plaintiff  had  agreed  to  sell  to  one 
Holt,  the  defendant  in  the  attachment;  but 
by  the  agreement  the  projiei'ty  was  not  to 
vest  in  Holt  until  he  should  pay  $100  (part  of 
the  price)  whicli  condition  was  not  performed, 
though  the  goods  were  delivered.  Holt  had 
paid  $75,  which  the  plaintiff'  did  not  tender 
back.  The  court  held  that  it  was  sufficient 
for  the  plaintiff  to  be  ready  to  repaj'  the 
money  Avhen  he  should  be  reiniested,  and  a 
verdict  for  the  plaintiff"  was  sustained. 

In  Barrett  v.  Piitchard.  2  Pick.  ."il2,  the 
court  said:  "It  is  impossible  to  rais«'  a  doubt 
as  to  the  intention  of  the  parties  in  this  cas(\ 
for  it  is  expressly  stipulated  that  'the  wool, 
before  manufactured,  after  being  manufac- 
tured, or  in  any  stage  of  manufacturing,  shall 
be  the  property  of  the  plaintiff"  until  the  jirice 
be  paid.'  It  is  difficult  to  imagine  any  good 
reason  why  this  agreement  sliould  not  bind 
the  parties.  *  *  *  The  case  from  Taun- 
ton (Ilolro.vd  V.  (Jw.xnne)  was  a  case  of  a  con- 
ditional sale;  but  the  condition  was  void  as 
against  the  policy  of  the  statute  21  Jac.  I.  c. 
10,  §  11.  It  would  not  have  changed  the  de- 
cision in  that  ca.se  if  there  had  been  no  sale; 
for,  by  that  statute,  if  the  true  owner  of 
goods  and  chattels  suffers  another  to  exercise 
such  control  and  management  over  them  as 
to  give  him  the  appearance  of  being  the  real 
owner,  and  he  becomes  bankrupt,  the  goods 
and  chattels  shall  be  treated  as  his  property, 
and  shall  be  assigned  bj'  the  commissioners 


IIG 


WHEN   TITLE  PASSES. 


for  The  benefit  of  liLs  creditors.  The  case  of 
Ilnrn  Y.  Baker.  !»  East,  21."'>.  also  turned  on 
the  same  point,  and  nothing  in  eitlier  of  tliese 
cases  lias  any  bearing  on  the  present  Ques- 
tion." 

In  Coggill  V.  Hartford  &  X.  II.  R.  Co..  .'! 
(Jray,  ."»4."».  the  rights  of  a  boiia  tide  purchaser 
from  one  in  possession  under  a  conditional 
Side  of  g(X3ds  were  specifically  discussed,  and 
the  court  held,  in  an  able  opinion  delivered  by 
Mr.  .fustice  I>igelow,  that  a  sale  and  delivery 
of  goods  on  condition  that  the  title  shall  not 
vest  in  the  vendee  until  payment  of  the  price 
passes  no  title  until  the  condition  is  perform- 
ed, and  the  vendor,  if  guilty  of  no  laches,  may 
reclaim  the  iiroperty,  even  from  one  who 
has  purchased  from  his  vendee  in  good  faith, 
and  without  notice.  The  learned  justice  com- 
menced his  opinion  in  the  following  terms: 
'It  has  long  been  the  settled  rule  of  law  in 
this  commonwealth  that  a  sale  and  delivery 
of  gootls  on  condition  that  the  property  is  not 
to  vest  until  the  purchase  money  is  paid  or 
secured,  does  not  pass  the  title  to  the  vendee, 
and  that  the  vendor,  in  case  the  condition  is 
not  fulfilled,  has  a  right  to  repossess  him- 
self of  the  goods,  both  against  the  vendee  and 
against  his  creditors  claiming  to  hold  tiiem 
under  attachments."  He  then  addresses  him- 
self to  a  consideration  of  the  rights  of  a  bona 
tide  purchaser  from  the  vendee,  piu'chasing 
without  notice  of  the  condition  on  which  the 
latter  holds  the  goods  in  his  possession;  and 
he  cimcludes  that  thej'  are  no  givater  than 
those  of  a  creditor.  He  says:  "All  the  cases 
turn  on  the  principle  that  the  compliance  Avith 
The  conditions  of  sale  and  delivery  is.  by  the 
terms  of  the  contract,  precedent  to  the  trans- 
fer of  the  property  from  the  vendor  to  the 
vendee.  The  vendee  in  such  cases  acquires 
no  property  in  the  goods.  He  is  only  a  bailee 
for  a  specific  purpose.  The  delivery  which  in 
ordinary  cases  passes  the  title  to  the  vendee 
must  take  effect  according  to  the  agreement 
of  the  parties,  and  can  operate  to  vest  the 
property  only  when  the  contingency  coutem- 
pLated  by  the  contract  arises.  The  vendee, 
therefore,  in  such  cases,  having  no  title  to 
the  property,  can  pass  none  to  others.  He 
has  only  a  bare  right  of  possession,  and  those 
who  claim  under  him,  either  as  creditors  or 
purchasers,  can  actpiire  no  higher  or  better 
title.  .Such  is  the  necessary  result  of  carry- 
ing into  etfect  the  intention  of  the  parties  to 
a  conditional  sale  and  delivery.  Any  other 
rule  would  be  equivalent  to  the  denial  of  the 
validity  of  such  contracts.  But  they  certainly 
violate  no  rule  of  law,  nor  are  they  contrary 
to  sound  policy." 

This  case  was  followed  in  Sargent  v.  ^Nlet- 
calf,  5  Gray,  oOO;  Deshou  v.  Bigelow,  8  Ciray, 
ir.f);  Whitney  v.  Eaten.  L")  (iray.  JU.l;  Hir- 
schorn  v.  Cauney,  OS  Mass.  141t;  and  Chase 
V.  Ingalls,  1"J2  Mass.  .'iSl;  and  is  l)elieved  to 
express  the  settled  law  of  Massachusetts. 

The  same  doctrine  i)revails  in  Connecticut, 
and  was  sustained  in  an  able  and  learned  opin- 
ion of  Chief  Justice  Williams,  in  the  case  of 


Forbes  v.  Marsh,  15  Conn.  384  (decided  in 
lS4o),  in  which  the  principal  authorities  are 
reviewed.  The  decision  in  this  case  was  fol- 
lowed in  the  subsequent  case  of  Hart  v.  Car- 
penter, 24  ( 'unn.  427.  wfcere  ihe  (luestion  arose 
u])on  the  claim  of  a  bona  fide  purchaser. 

In  New  York  the  law  Ls  the  same,  at  least 
so  far  as  relates  to  the  vendee  in  a  coiiditi<inal 
.sale  and  to  his  creditors;  though  there  has 
been  some  diversity  of  i  pinion  in  its  application 
to  bona  fide  purchasers  from  suc-h  vendee. 

As  early  as  1S22,  in  the  case  of  Haggerty 
V.  I'almer,  0  Johns.  Ch.  -i'M,  where  an  auc- 
tioneer had  delivered  to  the  purchaser  goods 
sold  at  auction,  it  being  one  of  the  conditions 
of  sale  that  indorsed  notes  should  be  given  in 
payment,  which  the  purchaser  failed  to  give, 
Chaiuellor  Kent  held  that  it  was  a  condi- 
tional sale  and  delivery,  and  gave  no  title 
which  the  vendee  could  trausfer  to  an  as- 
signee for  the  benefit  of  creditors;  and  he  said 
that  the  cases  under  the  English  bankrupt 
act  did  not  applj'  here.  The  chancellor  re- 
mai  ked.  however,  that  "if  the  goods  had  been 
fairly  sold  by  P.  [the  conditional  vendee],  or 
if  the  proceeds  had  been  actually  appropriated 
by  the  assignees  before  notice  of  this  suit 
and  of  the  injunction,  the  remedy  would  base 
been  gone." 

In  Strong  v.  Taylor,  2  Hill,  32G,  Nelsoii, 
C.  J.,  pronouncing  the  opinion,  it  was  held  to 
be  a  conditional  sale  Avhere  the  agreement 
was  to  sell  a  canal-boat  for  a  certain  sum,  to 
be  paid  in  freighting  flour  and  wheat,  as  di- 
rec-ted  by  the  vendor,  he  to  have  half  the 
freight  until  paid  in  full,  with  interest.  Be- 
fore the  money  was  all  paid  the  boat  was 
seized  under  an  execution  against  the  vendee; 
and,  in  a  suit  by  the  vendor  against  the  sher- 
iff, a  verdict  was  found  for  the  plaintiff,  un- 
der the  instruction  of  the  court,  and  was  sus- 
tained in  banc  upon  the  authority  of  the 
^lassachusetts  case  of  Barrett  v.  I'ritchard, 
2  I'ick.  .512. 

In  Herring  v.  Hoppock,  l.j  X.  Y.  4(«).  the 
same  doctrine  was  followed.  In  that  case 
there  was  an  agreement  in  Aviiting  for  the 
sale  of  an  iron  safe,  which  was  delivered  to 
the  vendee,  and  a  note  at  six  months  given 
therefor;  but  it  Avas  expressly  understood 
that  no  title  was  to  pass  until  the  note  was 
paid;  and  if  not  paid.  Herring,  the  vendor, 
was  authorized  to  retake  the  safe,  and  collect 
all  reasonable  charges  for  its  use.  The  sher- 
iff levied  on  the  safe  as  the  property  of 
the  vendee,  with  notice  of  the  plaintiffs  claim. 
The  court  of  appeals  held  that  the  title  did 
not  pass  out  of  Herring.  Paige.  .T..  said: 
"^^'henever  there  is  a  condition  precedent  at- 
tached to  a  contract  of  sjile  which  is  not  waiv- 
ed Ijy  an  absolute  and  unconditional  delivery, 
no  title  passes  to  the  vendee  until  he  performs 
the  c(;ndition  or  the  si-Uer  waives  it."  Com- 
stock,  J.,  said  that,  if  the  question  were  new, 
it  might  be  more  in  accordance  with  the  an- 
alogies of  the  law  to  regard  the  writing  giv- 
en on  the  sale  as  a  mere  security  for  the  debt 
iu  the  nature  of  a  personal  mortgage;   but  he 


WHEN  TITLE  PASSES. 


117 


coiisidfii'd  the  law  as  liaviu;:  boon  settle«l  by 
tlio  provioiis  casos,  and  tlio  conit  unanimously 
conourrod  in  tlio  decision. 

lu  the  cases  of  Smith  v.  Lynos,  o  N.  Y. 
41,  and  Wait  v.  l^Ireeu,  3.j  Barb.  ."jS5,  ou  aj)- 
poal,  '.\i\  N.  Y.  'toV,,  it  was  held  that  a  bona 
tide  purchaser,  witlujut  notice  from  .-i  vendee 
who  is  in  jjossession  under  a  conditional  sale, 
will  be  protected  as  against  the  orif^inal  ven- 
dor. Those  cases  were  reviewed,  and.  we 
think,  substantially  overruled,  in  the  subse- 
quent case  of  Ballard  v.  Burjjott,  40  N.  Y. 
.■'>14,  in  which  separate  olalnnate  opinions  were 
delivered  by  .Judges  U  rover  and  I^ott.  This 
decision  was  concurred  in  by  ('Iiief  .fudge 
Hunt,  and  .Judges  Woodruff,  .Mason,  and  Dan- 
iels; Judges  .James  and  Murray  dissenting. 
In  that  case  Ballard  agreed  to  sell  to  one 
I"" ranee  a  yoke  of  oxen  for  a  price  agreed  on, 
but  the  contract  had  the  condition  "that  the 
oxen  were  to  remain  the  property  of  Ballard 
until  they  should  be  paid  for."  The  oxen  were 
delivered  to  France,  and  he  subsequently  sold 
them  to  the  defendant  Burgett.  who  purchased 
and  received  them  Avithout  notice  that  the 
plaintiff  had  any  claim  to  them.  The  court 
sustained  I^allard's  claim;  and  subsequent 
cases  in  New  York  are  in  harmony  witli  this 
decision.  See  Cole  v.  Mann,  (52  N.  Y.  1; 
Beau  v.  Edge,  84  N.  Y.  510. 

We  do  not  perceive  that  the  case  of  Dows 
y.  Kidder,  84  N.  Y.  121.  is  adverse  to  the 
ruling  in  Ballard  v.  Burgett.  There,  al- 
though the  plaintiffs  stipulated  that  the  title 
to  the  corn  should  not  pass  until  payment 
of  the  price  (which  was  to  be  cash,  the 
same  day),  yet  they  indorsed  and  delivered 
to  the  purchaser  the  evidence  of  title,  name- 
ly, the  weigher's  return,  to  enable  him  to 
take  out  the  bill  of  lading  in  his  own  name, 
and  use  it  in  raising  funds  to  pay  the  plaiu- 
Titf.  The  purchaser  misappropriated  the 
funds,  and  did  not  pay  for  the  corn.  Here 
the  intent  of  both  parties  was  that  the  pur- 
chaser might  dispose  of  the  corn,  and  he 
was  merely  the  trustee  of  the  plaintiff,  in- 
vested by  him  wnth  the  legal  title.  Of 
course,  the  innocent  party  who  purchased 
the  corn  from  the  ttrst  purchaser  was  not 
bound  by  the  eipiities  between  him  and  the 
•plaintiff. 

The  later  case  of  Barker  v.  Baxter,  86  N. 
Y.  .")8<!,  was  preciselS'  similar  to  Dows  v. 
Kidder;  and  the  same  principle  was  in- 
volved in  Farwell  v.  Importers'  &  Traders' 
Bank,  Do  N.  Y.  483,  where  the  plaintiff  de- 
livered his  ow'n  note  to  a  broker  to  get  it 
discounted,  and  the  latter  pledged  it  as  col- 
lateral for  a  loan  made  to  himself.  The 
legal  title  passed;  and  although,  as  be- 
tween the  plaintiff  and  the  broker,  the  for- 
mer was  the  owner  of  the  note  and  its  pro- 
ceeds, yet  that  was  an  ocpiity  whicli  was 
not  binding  on  the  innocent  holder. 

The  decisions  in  Maine.  New  Hampshire, 
and  ^'ermout  are  understood  to  be  substan- 
tially to  the  same  effect  as  those  of  Massa- 
chusetts and  New   York;    though  by  recent 


statutes  in  Maine  and  Vermont,  as  also  in 
Iowa,  where  the  same  ruling  i)revailod.  it  is 
declared  in  effect  that  no  agreements  that 
personal  property,  bargained  and  delivered 
to  another,  shall  remain  the  property  of  the 
vendor,  shall  be  valid  against  riiira  persons 
without  notice.  George  v.  Stubbs,  20  Me. 
24:?:  Sawyer  v.  Fisher.  32  Me.  28;  Brown 
V.  Haynos,  ~t2  Me.  ."»T.S;  Boynton  v.  Libby. 
(i2  Me.  2.")3;  Rogers  v.  Whitehouse,  71  Me. 
222;  Sargent  v.  Gile,  8  N.  H.  32.');  McFar- 
land  V.  Fai-mer,  42  N.  H.  380;  King  v. 
Bates.  7)7  N.  H.  440;  Hetflin  v.  Bell,  30  Vt. 
134;  Armington  v.  Houston,  :i8  Vt.  448; 
Fales  v.  Roberts.  3S  Vt.  .">03;  Duncans  v. 
Stone,  4.'5  Vt.  123;  Moseley  v.  Shattuck.  43 
Iowa,  .")40;  Thorpe  v.  Fowler,  57  Iowa,  r>41. 
11  X.  W.  3. 

The  same  vieAV  of  the  law  has  been  taken 
in  several  other  states.  In  New  .Jersey,  in 
the  case  of  Cole  v.  Berry,  42  N.  .J.  Law,  308. 
it  was  held  that  a  contract  for  the  sale  of  a 
sewing-machine  to  be  delivered  and  paid  for 
by  installments,  and  to  remain  the  i)roperty 
of  the  vendor  until  paid  for.  was  a  condi- 
tional sale,  and  gave  the  vendee  no  title  un- 
til the  condition  was  performetl;  and  the 
ca.ses  are  very  fully  discussed  and  distin- 
guished. 

In  Pennsylvania  the  law  is  imdoistood  to 
be  somewhat  different.  It  is  thus  sunnnar- 
ized  by  .Judge  Depue,  in  the  opinion  deliv- 
ered in  ('ole  V.  Berry,  42  N.  .J.  Law.  314. 
where  he  says:  "In  Pennsylvania  a  distinc- 
tion is  taken  between  delivery  under  a  bail- 
ment, with  an  option  in  the  bailee  to  piir- 
chase  at  a  named  price,  and  a  delivery  un- 
der a  contract  of  sale  containing  a  reserva- 
tion of  title  in  the  vendor  until  the  contract 
price  be  paid;  it  being  held  that  in  the  for- 
mer instance  property  does  not  pass  as  in 
favor  of  creditors  and  purchasers  of  the 
bailee,  but  that  in  the  latter  instance  deliv- 
ery to  the  vendee  subjects  the  property  to 
execution  at  the  suit  of  his  creditors,  and 
makes  it  transferable  to  bona  fide  pur- 
chasers. Chamberlain  v.  Snnth.  44  Pa.  St. 
431;  Rose  v.  Story.  1  Pa.  St.  UK);  Martin  v. 
Mathiot.  14  Serg.  &  R.  214;  Haak  v.  Lin- 
derma  n.  04  Pa.  St.  409."  But.  as  the  learn- 
ed judge  adds:  "This  distinction  is  discred- 
ited by  the  great  weight  of  authority,  which 
])uts  possession  under  a  conditional  con- 
tract of  sale  and  possession  under  a  bail- 
ment on  the  same  footing.— liable  to  be  as- 
sailed by  creditors  and  pin-chasers  for  actual 
fraud,  but  not  fraudulent  per  se." 

In  this  connection,  see  the  case  of  Cop- 
land V.  Bos(iuet,  4  Wash.  C.  C.  588.  Fed. 
Cas.  No.  3,212.  where  Mr.  .Justice  Washing- 
ton and  .ludge  Peters  (the  former  delivering 
the  opinion  of  the  court)  sustained  a  condi- 
tional sale  and  delivery  against  a  pin-chaser 
from  the  vendee,  who  claimed  to  be  a  bona 
tide  purchaser  without  notice. 

In  Ohio  the  validity  of  conditional  sales  ac- 
companied by  delivery  of  possession  is  fully 
sustained.    The  latest  reported  case  brought 


US 


WHKX   TITLE  PASSES. 


to  our  attention  is  that  of  Call  v.  Seymour, 
-to  01iii>  Sr.  i»T<>.  whiih  arose  upon  a  written 
contract  contained  in  several  iironiissory 
notes  given  for  installments  of  the  purchase 
money  of  a  machine,  ami  resemblins?  very 
much  the  contract  in  the  case  now  under 
consideration.  FoUowinjr  the  note,  and  as 
a  ijait  of  the  same  document,  is  this  condi- 
tion: "The  express  conditions  of  the  sale 
and  purchase  of  the  separator  and  horse- 
ix)wer  for  which  this  note  is  ariven,  is  such 
that  the  title,  ownership,  or  possession  does 
not  pass  from  the  said  Seymour,  Snbin  & 
Co.  until  this  note,  with  interest,  is  paid  in 
full.  The  Siiid  Seymour.  Sabin  &  Co.  have 
full  power  to  dec-lare  this  note  due.  and 
take  possession  of  said  separator  and  horse- 
power, at  any  time  they  may  deem  this 
note  insecure,  even  before  the  maturity  of 
the  note,  and  to  sell  the  said  machine  at 
public  or  private  sale,  the  proceeds  to  be  ap- 
plied upon  the  unpaid  balance  of  the  pur- 
chase price."  The  machine  was  seized  un- 
der an  attachment  issued  against  the  ven- 
dee, and  the  action  was  brought  by  the  ven- 
dor against  the  constable  who  served  the 
attachment.  The  case  was  fully  argued, 
and  the  authorities  pro  and  con  duly  consid- 
ered by  the  court,  which  sustained  the  con- 
dition expressed  in  the  contract,  and  af- 
firmed the  judgment  for  the  plaintiff.  See, 
also,  Sanders  v.  Keber,  28  Ohio  St.  0:iO. 

The  same  law  prevails  in  Indiana.  Shire- 
man  V.  Jackson,  14  Ind.  4r)!);  Dunbar  v. 
Kawles,  28  Ind.  22.j;  Bradsliaw  v.  War- 
ner, 54  Ind.  TjS;  Hodson  v.  Warner,  00 
Ind.  214;  McGin-  v.  Sell,  Id.  241).  The  same 
in  Michigan.  Whitney  v.  McConnell.  2!j 
Mich.  12;  Smith  v.  Lozo,  42  Mich.  (J,  :{  N. 
W.  227;  Marquette  Manuf'g  Co.  v.  .leffeiy, 
49  Mich.  283.  IS  X.  VV.  .",1)2.  The  same  in 
Missouri.  Itidgeway  v.  Kennedy,  52  Mo. 
24;  Wangler  v.  Franl<lin,  70  Mo.  O-"*!);  Sum- 
ner V.  Cottey,  71  Mo.  121.  The  same  in  Al- 
abama. P'airbanks  v.  Eureka,  07  Ala.  101); 
Sumner  v.  Woods,  Id.  131).  Tlie  same  in 
several  other  states.  For  a  very  elaborate 
collection  of  cases  on  the  subj(!Ct,  see  Mr. 
Bennett's  note  to  Benj.  Sales  (4th  Ed.)  § 
320,  pp.  321)-330;  and  Mr.  Freeman's  note 
to  Kaiiaga  v.  Taylor.  70  Am.  Dec.  02,  7  Oiiio 
St.  i'.'A.  It  is  unnecessary  to  ()Uote  fuiilici- 
from  the  decisions.  'I  In-  (|iiotations  al- 
ready made  show  the  ;:ioiiii(!s  and  reasons 
of  the  rule. 

The  law  has  Ijcen  |]<-l'l  iliHfi"iilly  in  Hli- 
nolH,  and  very  nearly  in  'Diironiiity  willi 
the  English  decisions  nndi-r  tin?  operation 
of  the  l)arikru|)t  law.  Tlie  docliiin'  ni'  tlic 
Hijpreriie  court  of  that  state  Is  llnil  il  a  jk  i- 
Mon  agrees  to  st-li  to  anotjicr  ;i  cliMllfl  on 
condition  that  the  f»rlcc  shall  l>c  p:ii(l  vvitiiii 
a  certain  time,  r(;talnlng  the  tith;  in  liiniKell' 
In  the  mean  time,  and  dclivfis  tiic  chatlcl 
lo  the  vendee  so  as  to  clollii-  liim  with  the 
aj>|,ar<'nt  ownership,  a  hnna  liilc  iiincliaser, 
or  an  execution  cr«-dltor  of  the  latter-,  Is  en- 
titled  to  ifroter-tlon  as  against  the  claim  of 


the  original  vendor.  Brundage  v.  Camp, 
21  111.  330;  McCormick  v.  Hadden,  37  111. 
370;  Murch  v.  Wriglit,  4(5  111.  4SS:  iSlichigan 
Cent.  K.  Co.  v.  I'hillips.  (!0  111.  IIH);  Lucas 
V.  Campbell.  88  111.  447;  Van  Duzor  v.  Al- 
len, 00  111.  4911.  Perhaps  the  statute  of  Illi- 
nois on  the  subject  of  chattel  mortgages  has 
influenced  some  of  these  decisions.  This 
statute  declares  that  "no  mortgage,  trust 
deed,  or  other  conveyance  of  personal  prop- 
erty having  the  effect  of  a  mortgage  or  lien 
upon  such  proi>erty,  is  valid  as  against  the 
rights  and  interests  of  any  third  person,  un- 
less the  possession  thereof  be  delivered  to 
and  remain  with  the  grantee,  or  the  instru- 
ment provide  that  the  possession  of  the 
property  may  remain  witli  the  grantor,  and 
the  instrument  be  acknowledged  and  re- 
corded." It  has  been  supposed  that  this 
statute  indicates  a  rule  of  public  policy  con- 
demning secret  liens  and  reservations  of 
title  on  the  part  of  vendors,  and  making 
void  all  agreements  for  such  liens  or  reser- 
vations imless  registered  in  the  manner  re- 
quired for  chattel  mortgages.  At  all  events, 
the  doctrine  above  referred  to  has  become 
a  rule  of  property  in  Illinois,  and  we  have 
felt  bound  to  observe  it  as  such. 

In  the  case  of  Hervey  v.  Rhode  Island 
Locomotive  Works,  93  U.  S.  004,  Avhere  a 
Rhode  Island  company  leased  to  certain 
Illinois  railroad  contractors  a  locomotive  en- 
gine and  tender  at  a  certain  rent,  payable  at 
stated  times  during  the  ensuing  year,  with 
an  agreement  that,  if  the  rent  was  duly 
paid,  the  engine  and  tender  should  become 
the  property  of  the  les.sees,  and  possession 
was  delivered  to  them,  this  court,  being  sat- 
isfied that  tlie  transaction  was  a  conditional 
sale,  and  that,  by  the  law  of  Illinois,  the 
reservation  of  title  by  the  lessors  was  void 
as  against  third  persons  unless  the  agree- 
ment was  recorded  (which  it  was  not  in 
])roper  time),  decided  that  a  levy  and  sale  of 
tlie  projierty  in  Illinois,  under  a  judgmenc 
against  the  lessees,  were  valid,  and  tliat  the 
locomotive  works  could  not  icclaim  it.  Mr. 
Justic<'  Davis,  delivering  the  opinion  of  the 
court,  said:  "It  Avas  decided  by  this  court 
in  Green  v.  Van  Buskirk,  o  Wall.  307,  and  7 
Wall.  i:'.0,  that  the  lial>ility  of  property  to 
he  sohl  under  legal  jn-ocess  issuing  from  the 
courts  of  the  slate  where  it  is  situated,  must 
be  (lelerniiMcd  by  the  law  there,  rather  tlian 
tli;it  of  the  jurisdiction  wlicre  (lie  owner 
lives.  Tiiese  deeisious  rest  ou  the  gr()un<l 
that  every  slate  lias  the  right  to  regulate 
lh<-  ti-.-iiisfei'  of  piopei'ly  wiliiin  ils  limits, 
aM<l  lliat  \\iioe\cr  sends  pi'op«>rly  to  it  im- 
pliedly snltinils  lo  I  he  regidatious  <M)ncern- 
iiig  ils  liaiisfei'  in  force  there,  although  a 
diniTeut  rule  of  hausrer  pi'cvails  in  the  ju- 
risdiction wliiTc  he  resides.  ♦  *  *  Tjie 
policy  of  Hie  law  in  Illinois  will  mil  |ieiinit 
Die  ouiiei'  of  personal  properly  to  sell  il, 
eilhei-  iilisoliilc!)'  or  condil  ioua  lly.  and  slill 
continue  in  possession  <ir  il.  ros^essiou  is 
one    of    llie    sli'ongesl    evidences    of    till*!    to 


WHEN  TITLE  PASSES. 


119 


this  class  of  property,  and  cannot  be  rijiht- 
fully  separated  from  the  title,  except  in  the 
manner  pointed  out  by  the  statute.  The 
ooui'ts  of  Illinois  say  that  to  suffer,  without 
notice  to  the  Avorld,  the  real  ownersliip  to  be 
in  one  person,  and  the  ostensible  ownership 
in  another,  gives  a  false  credit  to  the  latter, 
and  in  this  way  works  an  injury  to  tliird 
persons.  Aceordinfjly,  the  actual  owner  of 
personal  property  creatins'  an  interest  in  an- 
other to  whom  it  is  delivered,  if  desirous  of 
preserving'  a  lien  on  it,  must  comply  with 
the  provisions  of  the  chattel  mortgaj^e  act. 
Rev.  St.  111.  1874,  711,  712."  The  Illinois 
cases  are  then  referred  to  by  the  learned 
justice  to  show  the  precise  condition  of  the 
law  of  that  state  on  the  subject  under  con- 
sideration. 

The  case  of  Hervey  v.  Rhode  Island  Ix)CO- 
motive  AVorks  is  relied  on  by  the  appellants 
in  the  present  case  as  a  decision  in  their 
favor;  but  this  is  not  a  correct  conclusion, 
for  it  is  apparent  that  the  only  points  de- 
cided in  that  case  were— First,  that  it  was 
to  be  governed  by  the  law  of  Illinois,  the 
place  where  the  property  was  situated;  sec- 
ondly, that  by  the  law  of  Illinois  the  agree- 
ment for  continuing  the  title  of  the  property 
in  the  vendors  after  its  delivery  to  the  ven- 
dees, whereby  the  latter  became  the  osten- 
sible owners,  AA'as  void  as  against  third  per- 
sons. This  is  all  that  was  decided,  and  it 
does  not  aid  the  appellants,  unless  they  can 
show  that  the  law  as  held  in  Illinois,  con- 
trary to  the  great  weight  of  authority  in 
England  and  this  country,  is  that  Avhich 
should  govern  the  present  case.  And  this 
we  think  they  cannot  do.  We  do  not  mean 
to  say  that  the  Illinois  doctrine  is  not  sup- 
ported by  some  decisions  in  other  states. 
There  are  such  decisions;  but  they  are  few 
in  number  compared  with  those  in  which  it 
is  held  that  conditional  sales  are  valid  and 
lawful  as  well  against  third  persons  as 
against  the  parties  to  the  contract. 

The  appellants,  however,  rely  with  much 
confidence  on  the  decision  of  this  court  in 
Heryford  v.  Davis,  102  U.  S.  235.  a  case 
coming  from  iNIissouri,  where  the  law  al- 
lows and  sustains  conditional  sales.  But 
we  do  not  think  that  this  case,  any  more 
than  that  of  Hervey  v.  Rhode  Island  Loco- 
motive Works,  will  be  found  to  support 
their  views.  The  whole  question  in  Hery- 
foi'd  V.  Davis  was  as  to  the  construction  of 
the  contract.  This  was  in  the  form  of  a 
lease,  but  it  contained  provisions  so  ir- 
reconcilable with  the  idea  of  its  being  real- 
ly a  lease,  and  so  demonstrable  that  it  was 
an  absolute  sale  with  a  reservation  of  a 
mortgage  lien,  that  the  latter  interpretation 
was  given  to  it  by  the  court.  This  inter- 
pretation rendered  it  obnoxious  to  the  stat- 
ute of  Missouri  requiring  mortgages  of  per- 
sonal property  to  he  recorded  in  order  to  be 
valid  as  against  third  persons.  It  was  con- 
ceded by  the  court,  in  the  opinion  delivered 
by    iNIr.    Justice    Strong,    that    if   the    agree- 


ment had  really  amounted  to  a  lease,  with 
an  agreement  for  a  conditional  sale,  the 
claim  of  the  vendors  Avould  have  been  valid. 
The  first  two  or  three  sentences  of  the  opin- 
ion furnish  a  key  to  the  whole  effect  of  the 
decision.  Mr.  .lustice  Strong  says:  "The 
correct  determination  of  this  case  depends 
altogether  upon  the  construction  that  must 
be  given  to  the  contract  between  the  .lack- 
son  &  Shar])  Company  and  the  railroad  com- 
pany, against  which  the  defendants  below 
recovered  their  judgment  and  obtained  theh- 
execution.  If  that  contract  was  a  mere 
lease  of  the  cars  to  the  railroad  company,  or 
if  it  was  only  a  conditional  sale,  which  did 
not  pass  the  owneiship  until  the  condition 
should  be  performed,  the  property  was  not 
subject  to  levy  and  sale  iiiider  execution  at 
the  suit  of  the  defendant  against  the  com- 
pany. But  if,  on  the  other  hand,  the  title 
passed  by  the  contract,  and  what  was  re- 
served by  the  Jackson  &  Sharp  Company 
was  a  lien  or  security  for  the  payment  ot 
the  price,  or  what  is  called  sometimes  a 
mortgage  back  to  the  vendors,  the  cars  were 
subject  to  levy  and  sale  as  the  property  of 
the  railroad  company."  The  whole  residue 
of  the  opinion  is  occupied  with  the  discus- 
sion of  the  true  construction  of  the  con- 
tract; and,  as  Ave  have  stated,  the  conclu- 
sion Avas  reached  that  it  Avas  not  really  a 
lease  nor  a  conditional  sale,  but  an  absolute 
sale.  Avith  the  leservation  of  a  lien  or  se- 
curity for  the  payment  of  the  price.  This 
ended  the  case;  for,  thus  interpreted,  the 
instrument  inured  as  a  mortgage  in  favor  of 
the  vendors,  and  ought  to  have  been  record- 
ed in  order  to  protect  them  against  third 
persons. 

But  whatever  the  laAV  may  be  Avith  regard 
to  a  bona  fide  purchaser  from  the  vendee  in 
a  conditional  sale,  there  is  a  circumstance 
in  the  present  case  Avhich  makes  it  clear  of 
all  difficulty.  The  appellant  in  the  present 
case  Avas  not  a  bona  fide  purchaser  Avithout 
notice.  The  court  beloAV  find  that,  at  the 
time  of  and  prior  to  the  sale,  he  kneAV  the 
purchase  price  of  the  property  had  not  been 
paid,  and  that  Russell  &  Co.  claimed  title 
thereto  until  .such  payment  Avas  made.  Un- 
der such  circumstances,  it  is  almost  the 
lananimous  opinion  of  all  the  courts  that  he 
cannot  hold  the  property  as  against  the  true 
OAvners;  but  as  the  I'ulings  of  this  court 
have  been,  as  Ave  think,  someAvhat  misun- 
derstood, we  have  thought  it  proper  to  ex- 
amine the  subject  Avith  some  care,  and  to 
state  Avhat  Ave  regard  as  the  general  rule 
of  laAV  Avhere  it  is  not  affected  by  local  stat- 
utes or  local  decisions  to  the  contrary. 

It  is  only  necessary  to  add  that  there  is 
nothing  either  in  the  statute  or  adjudged 
law  of  Idaho  to  prevent,  in  this  case,  the  op- 
eration of  the  general  rule,  Avhich  Ave  consid- 
er to  be  established  by  overAvhelming  au- 
thority, namely,  that,  in  the  absence  of 
fraud,  an  agreement  for  a  conditional  sale  is 
good  and  valid  as  Avell  against  third  persons 


120 


as   asiiiiist    the    piivtirs 
ami  the  furthor  rule,  that  a  bailee  of  per- 
sonal  property  caimot   convey  the   title,   or 


WHEN   TITLE  PASi^ES. 
to    the    transaction;  1  until  the  condition  on  which  the  agreement 


to  sell  was  made,  has  been  performed. 
The  jiKlsment  of  the  supreme  court  of  the 


subject  it  to  'execution  for  his  own  debts,      territory  of  Utah  is  affirmed 


WHEN  TITLE  PASSES. 


121 


WAGAR  y.  DETROIT,  L.  &  N.  R.  CO. 

(44  X.  W.  1113,  79  Mich.  G48.) 

Supreme  Court  of  Michigan.     April  11,   1890. 

Appeal  from  circuit  court,  Ionia  county; 
Vkkxox  H.  Smith,  Ju(l^;e. 

Replevin  by  Hnmproy  R.  Wagar  ajarainst 
the  Detroit,  Laiisinji:  &  Northern  Railroad 
Company,  wliich  had  taken  pos.session  of 
the  property  in  controversy  as  bein;^  tiiat 
of  .John  J.  Foster  &  Co.  There  was  judu;- 
ment  for  i)laintiff,  and  defendant   appeals. 

Lemuel  &  Willhun  ('lute A  H'.  E.  Hoyt,  of 
counsel,)  for  appellant.  Mciiuvry  &  Ford 
and  W.  W.  Mitchell,  for  appellee. 

CAMPBELL,  J.  In  thi.s  casethefacts  are 
fonnd  and  rest  chiefly  on  documents.  The 
only  question  in  the  case  which  is  of  any 
special  importance  is  whether  a  sale  of 
lumber  made  bv  W.  F.  &  G.  W.  Turner  to 
John  J.  Foster "&  Co.  passed  title  to  100,000 
feet  of  mill  culls  i-eplevied  in  this  suit.  On 
August  17,  lsS7,  \V.  F.  &  G.  W.  Turner 
owned  12"), 000  feet  of  pine  mill  cidls,  piled 
up  at  Dixon's  siding,  in  piles  mai'ked"  Mill 
Culls,"  but  containing  more  or  less  other 
lumber.  On  that  day  the  Turners  sold  b5^ 
absolute  bill  of  sale,  and  for  pavmentmade 
at  the  time,  100,000  feet  of  mill  culls,  at 
f  5.50.  to  be  loaded  as  quickly  as  possible. 
The  sale  was  made  at  the  purchaser's  office 
in  Greenville.  Two  days  thereafter  George 
W.  Turner  sold  to  his  Ijrotlier  William  F. 
Turner  his  undivided  half  of  their  joint 
property,  consisting  of  logs  and  miscella- 
neous luml)ering  ])roperty,  including  lum- 
ber piled  at  Dixon's  siding,  which  included 
various  grades  of  pine  and  some  hendock. 
On  the  2Gth  of  August,  ],SS7,  W.  F.  Turner 
sold  to  plaintiff  all  the  pine  and  hemlock 
lumber  piled  at  Dixon's  siding,  and  all  the 
logs  and  hnnber  at  Stroupe  &  Payne's 
mill,  at  Cedar  Lake,  in  Kent  county.  This 
was  to  be  paid  for  at  seven  dollars  a  thou- 
sand for  all  grades  above  dead  culls,  de- 
ducting cost  of  manufacture  and  other  ex- 
penses, including  that  of  loading  on  the 
cars  for  shipment.  This  was  to  be  paid  as 
certain  notes  matured  against  Turner  at 
two  l)anks  named  and  his  remainbig  bank 
indel)tedness.  Plaintiff  took  such  posses- 
sion as  was  practicable.  On  The  night  of 
September  5th,  P^oster  &  Co.  took  away 
from  the  piles  at  Dixon's  siding  112.1)45  feet, 
which  included  3.000  feet  which  had  been 
sawed  after  their  purchase.  This  whole 
amount  is  the  property  replevied.  It  is 
not  claimed  that  this  extra  12.945  feet  was 
the  property  of  P'oster  &  Co..  an<l  to  that 
extent  the  ])laintiff  was  entitled  to  recover. 
But  it  is  claimed  bv  defendants  that  the 
100.000  feet  belonged  to  F(jster  &  Co.  It 
cannot  be  disputed  that  if  Foster  &  Co. 
owned  100,000  feet  of  the  hnnber  plaintiff 
could  not  get  any  title  to  it  by  his  pur- 
chase. He  could  onl3' take  what  was  the 
propertv  of  his  vendor.  Turtle  v.  White, 
4(5  Mich.'  4S5.  9  N.  W.  Rep.  52S.  Neither  can 
it  be  claimed  that  if  Foster  &  Co.  ever  got 
title  to  any  lumber  they  hjst  it.  The  only 
question  is  whether  their  purchase  was 
complete,  or  was  a  mere  agreement  to  sell. 

No  pi'inciple  is  more  unifornily  settled 
than  that  title  passes  by  a  sale  of  personal 
property,  where  such  is  the  meaning  of  the 


acts  of  the  parties;  and  it  is  equally  well 
settled  that,  whr-re  nothing  remains  to  be 
dcMie  by  the  vendor,  title  passes.  Lingham 
v.  Eggleston.  27  Mich.  324 ;  Wilkinson  v. 
Holiday,  :{:{  Mich.  :{S():  Haskell  v.  Ayres, 
35  Mich.  S9;  (Jrant  v.  Bank,  Id.  515;  Iron 
Cliffs  Co.  v.  Buhl,  42  Mich.  SO,  3  N.  W. 
Rep.  2()9;  Carpenter  v.  Graham,  42  Mich.  191, 
3  N.  W.  Rep. 974;  Larkin  v.  Lumber  Co. .42 
Mich.  29(i,  3  N.  W.  Rep.  904.  All  of  those 
cases — which  are  but  a  small  number  of 
our  own  decisions — recognize  these  i)rinci- 
ples,  and  some  of  them  are  nearl.v.  and 
some  are  j)recisely,  analogous.  In  Ling- 
ham  V.  Eggleston  and  Wilkinson  v.  Holi- 
da.v,  where  title  did  not.  or  did  not  neces- 
sarily, pass,  the  decisions  were  based  on 
grounds  which  distinctl.v  recognized  the 
distinctions  named.  In  Haskell  v.  Ayres 
it  was  held  that  a  sale  of  all  the  merchant- 
able timber  on  specified  lands  i)assed  an 
immediate  and  complete  title,  and  the 
merchantable  character  was  a  fact  which 
was  susceptil)le  of  proof,  although  this 
quality  was  found  in  wocjds  containing 
other  timber,  and  it  must  of  necessity  be 
to  some  extent  a  matter  of  judgment.  In 
Grant  v.  Bank  an  agreement  was  made  to 
conve.v  to  a  trustee  "all  the  merchantable 
long  timber,  not  to  exceed  20  per  cent,  of 
Norway,  in  the  boom  at  East  Tawas,  and 
enough  more  to  make  up  the  (piantity  to. 
one  million  feet,  at  ten  and  a  half  dollars 
per  thousand  feet,  the  same  to  be  rafted 
and  delivered  to  sfwd  trustee,  free  of  charges, 
when  required,  he  furnishing  the  necessary 
chains  for  rafting  the  same;  the  sale  and 
delivery  in  the  boom  to  be  made  as  soon 
as  possible.  "  It  was  held  in  this  case  that 
a  bill  of  sale  and  acceptance  of  order  by 
the  boom  com])an.v  passed  the  title  at 
once,  although  there  were  several  contin- 
gencies and  dithculties  as  to  identifica- 
tion, and  that  such  subsequent  expenses 
of  rafting  and  towing  as  are  chai-geaijle 
to  an  owner  became  thei-eby  chai-geable 
to  the  trustee.  In  Iron  Cliffs  Co.  v.  Buhl. 
Avhen  2,000  tons  of  ore  out  of  a  larger  mass 
were  sold  to  purchasers,  who  p.iid  for  it  in 
full,  they  were  held  subject  to  lose  300 
tons,  which  the  bailee  failed  to  transport 
to  them.  It  was  held  that,  as  the  mass 
was  of  similar  kind  and  character, it  made 
no  difference  that  the  one  sold  was  to  be 
taken  from  it  when  done  by  the  vendors  or 
their  agents.  In  Carpenter  v.  Graham  a 
sale  of  a  thousand  barrels  out  of  a  larger 
number  of  several  thousand  passed  title 
before  severance,  so  as  to  prevail  against 
a  seizure  under  pi-oeess.  In  each  of  the  lat- 
ter cases  it  recpiired  the  action  of  the  ven- 
dee to  identify  the  property  sold,  but  the 
vendor  had  no  further  contrt)l  to  direct 
what  should  be  taken.  It  is  impossible  to 
distinguish  these  cases  from  the  one  before 
us;  and  where  our  own  decisions  reach 
the  case  it  is  not  admissible  to  go  beyond 
them.  It  is  nevei-thdess  stated  in  Judge 
Hoi.MKs'  note  to  2  Kent,  Comm.  492,  and 
in  Kerr's  notes  to  Benjamin  on  .Sales,  §  :39S, 
that  the  prevailing  American  doctrine  sus- 
tains the  transfer  of  title  to  property  to  be- 
taken by  the  i)urchaserfr(Mn  a  larger  mass. 
If  this  doctrine  is  not  true.it  would  follow 
that  a  sale  to  two  different  persons  of  100,- 
000  feet,  in  a  lumber  yard  of  200,000  feet, 
would  be  of  no  avail  against  a  subseciuent 


322 


WHEN  TITLE  PASSES. 


sale  of  the  whole  to  a  third  party  The 
last  purchaser  would  be  uo  more  protected 
ao-ainst  fraud  by  the  sale  to  the  former 
purchaser  of  a  particular  pile  than  of  part 
of  the  lumber,  and  there  is  no  rule  of  law 
which  defeats  a  completed  honest  sale  by 
a  subsequent  sale  to  somebodyelse  whetli- 
er  the  latter  is  honest  or  dishonest,  l.ut 
we  are  onlv  concerned  here  with  enlorcing 
our  own  decisions,  which  were  not  hastily 
made,  and  wliich  this  court  has  never  de- 
clared subject  to  reconsideration.  Any  de- 
parture from  them  would  amount  to  an 
e\  post  fncto  extinction  of  rights  acquired 
'-'ider  them.    Under  the  facts  found,  plam- 


tiff's  recovery  should  not  have  been  al- 
lowed, and  defendants  should  have  judg- 
ment for  the  value  of  100,000  feet  of  lumber 
or  its  return  with  such  damages  as  iiave 
accrued  by  the  expenses  of  loading  and 
carriage. 

MORSE,  .1.,  did  not  sit. 

CHAMPLIX,  C.  J.,  and  LOXrj  and 
GRANT.  J.I.  The  foregoing  o[)inion  was 
prepared  bv  our  late  associate.  We  con- 
cur in  the  "opinion,  and  adopt  it  as  our 
own.  Judgment  is  reversed,  and  new  trial 
ordered. 


WHEN   TITI.K   PASSES. 


123 


NOAH  V.   PIERCE. 

(48  N.  W.  277,  85  Mich.  70.) 
Supreme  Court  of  Michisan.     Feb.  27,  1891. 
Error  to  circuit  court,  .\IIt'f;au  couuty;   Dan 

J.  Arnold,  .Tudj?e. 
Tntem  &  Quiusey,  for  appellant.     Padfiliam 

«fc   Huini)lirey,    for   appellee. 

MOUSE.  ,[.  This  is  a  case  ori^iinatiufi  in 
justice  court,  and  in  which  tlie  plaintiff  has 
recovered  judj^nient  in  that  court  and  the 
circuit,  for  the  value  of  a  wajjcon  sold  at  auc- 
tion for  the  sum  of  .i^ll.7.j.  The  circuit  judge 
finds  the  facts  to  be,  in  substance,  that  tlie 
plaintiff  had  a  sale  at  public  auction  of  his 
stock  and  farming  tools.  "All  sums  over  five 
dollars"  were  to  be  on  six  months'  time,  on 
good  approved  security.  Tlie  defendant  was 
present,  and  plainly  saw  the  wagon,  and  bid 
witii  others  upon  it.  It  Mas  struck  off  to 
him  at  .i^ll.7;").  After  the  sale  was  conclud- 
<'d,  and  defendant  was  going  home,  he  said 
to  plaintiff,  "I  will  settle  with  you  for  this 
wagon  the  first  time  you  come  to  Moline;"' 
and  plaintiff  replied,  "That  is  all  right."  As 
the  parties  botli  then  intended  and  under- 
stood the  matter,  the  wagon  so  bought  by  the 
defendant  was  then  his  property,  and  the 
title  had  passed  to  him,  and  he  was  to  settle 
for  it  when  the  plaintiff  came  to  Moline, 
Avhere  defendant  resided.  About  two  weeks 
after  the  sale  the  plaintiff  called  upon  the  de- 
fendant at  iNIoline,  and  asked  him  lo  settle 
for  the  wagon.  Defendant  replied  that  he 
didn't  know  as  he  would  take  it;  that  he  had 
no  use  for  it;  but  that  he  would  take  it  if 
])laintitf  would  take  his  pay  out  of  defend- 
ant's store.  Plaintiff  refused  to  do  this,  and 
defendant  refused  to  settle  or  pay  for  the 
wagon  in  any  other  way,  and  about  four 
months  thereafter  the  plaintiff  broiight  this 
suit  to  recover  the  purchase  price  of  the 
wagon.  It  is  claimed  on  the  part  of  the  de- 
fendant that  he  supposed  he  was  bidding  on 
another  wagon,  and  not  upon  the  one  he 
bought;  that  there  was,  by  reason  of  this 
mistake,  no  meeting  of  the  minds  of  the  par- 
ties, and  hence  no  sale.  But  this  claim  is 
not  made  out  by  the  evidence  in  the  case; 
therefore    it   liecomes  unnecessarv    to   deter- 


mine whether,  if  ti"ue,  it  would  or  would  not 
have  the  effect  claimed.  It  is  claimed  there 
can  be  no  recovery,  because  it  is  claimed 
there  was  no  delivery  of  the  wagon  to  de- 
fendant. The  wagon  was  left  where  it  was 
when  soM  to  defendant;  the  plaintiff  has  not 
since  that  tinu'  assumed  or  exercised  any 
control  over  it,  or  meddled  with  it  in  any 
way.  It  has  ever  since  been  subject  to  the 
defendant's  control  and  disposal.  It  is  claim 
ed  that  plaintiff  should  have  resold  the 
wagon,  and  that,  had  he  done  this,  he  could 
have  recovered  only  the  difference  between 
the  price  received  on  such  resale,  and  the 
price  bid  by  defendant,  and  until  such  resale 
there  can  be  no  recoveiy.  The  proofs  show 
the  wagon  to  have  been  worth  the  full  sum 
bid  by  the  defendant  at  the  lime  It  was 
struck  off'.  The  court  found,  as  matters  of 
law,  as  follows:  "(1)  The  title  liaving  passed 
to  defendant,  as  already  found,  the  measui-e 
of  damages  is  not  the  difference  (if  any)  be- 
tween the  actual  value  at  the  time  .aid  the 
sum  for  which  the  defendant  bought  the 
wagon;  and  inasnuich  as  the  defennant  re- 
fused to  settle  with  the  plaintiff"  for  the  pur- 
chase price  of  the  wagon,  and  to  execute  any 
evidence  of  indebtedness  for  the  amount  due 
in  six  months  with  seven  per  cent,  interest, 
or  to  pay  for  the  wagon  at  all  except  in  goods, 
he  was  not  entitled  to  the  six  montns  men- 
tioned in  the  printed  conditions  of  sale,  but 
the  amount  was  due  and  payable  at  once,  as 
though  no  conditions  of  sale  had  been  men- 
tioned. (2)  The  plaintiff"  is  entitled  to  have 
judgment  entered  in  his  favor  against  the  de- 
fendant for  the  said  sum  of  .^11.7.5,  togetlicr 
with  $1.77  interest  from  May  20,  1887. 
amounting  in  all  to  $13.52,  together  with  his 
costs  of  suit  in  this  court,  as  in  cases  com- 
menced in  this  court,  to  be  taxed,  and  to 
have  execution  therefor."  Errors  are  assign- 
ed upon  the  findings  of  fact  by  the  court,  but 
the  record  shows  that  there  was  testimony 
tending  to  support  each  of  such  findings,  and 
therefore  we  cannot  disturb  them.  The  con- 
clusions of  law  upon  Ihe  facts  found  are  cor- 
rect.     The  judgment  is  attirmed,  with  costs. 

LOXCi.  .T..  did  not  sit.      The  otlier  justices 
concurred. 


124 


whp:n  title  tasses. 


LOBDELL  rt  al.  v.  HORTON. 

(40  N.   W.  28,  71   Mirli.  U81.) 
Suiirciuo  Conrt  of  .Mi«lii;,Mii.     Oct.  19.  1888. 

Error  to  cire'uil  courl.  Mct-osta  county;  C. 
C.  Fuller.  Judye. 

Assumpsit  by  Albert  W.  Lobdell,  Moses 
Kerrid.tre.  and  Georj^e  K.  Slossou.  aga-iust 
Thomas  G.  Hortou.  for  Jj^tul.'Jl,  balance  due 
on  goods  sold.  .Tudgment  was  entered  on  a 
vei-di<'t  for  defendant,  and  plaintiff  brings 
error. 

L.  (}.  Palmer  and  X.  W.  Bush,  for  aiipel- 
lants.     Frank  Dumon,  for  appellee. 

CHAMPLIX,  J.  riaintiff  brought  assump- 
sit to  recover  on  an  account  for  goods  sold 
and  delivered.  The  declaration  was  upon 
the  common  counts.  The  defendant  pleaded 
the  general  issue,  with  notice  of  set-off.  On 
the  trial  defendant  admitted  the  correctness 
of  plaintiffs  claim,  subject,  however,  to  be 
reduced  by  such  set-off  as  he  should  be  able 
to  i)rove.  The  main  contention  was  over  a 
quantity  of  hemlock  logs,  which  defendant 
claimed  to  have  sold  and  delivered  to  plain- 


tiffs, and  for  which  the  plaintiffs  were  to  pay 
him  ^'2.1o  for  each  thousand  feet,  as  soon 
as  they  were  sawed,  according  to  the  mill 
tally.  The  plaintiffs,  on  the  contrary,  claim- 
(>d  that  the  transaction  was  not  an  absolute 
sale,  but  was  intended  as  a  security  for  an 
indebtedness  which  defendant  owed  to  them. 
'J'he  testimony  in  support  of  the  theory  of 
each  i)arty  was  properly  submitted  to  the 
jury  by  the  court,  and  they  found  in  accord- 
ance with  the  defendant's  theory.  Plaintiffs' 
claim  that,  because  the  logs  were  not  to  be- 
paid  for  until  the  lumber  was  sawed  and 
tallied,  so  as  to  ascertain  the  <iuantity,  that 
the  title  did  not  pass.  The  pith  of  the  ques- 
tion lies  in  the  fact  that  before  the  logs  were 
sawed  they  were  mostly  destroyed  by  fii'e. 
We  have  often  decided  that  whether  the  title 
passed  or  not,  where  something  remained  to 
be  done  before  the  exact  amount  to  be  paid 
could  be  arrived  at  depended  upon  the  inten- 
tion of  the  parties,  and  was  a  proper  ques- 
tion of  fact  to  be  determined  by  a  jury.  Up- 
on this  point  the  charge  was  explicit,  and 
we  see  no  occasion  for  disturbing  the  ver- 
dict. The  judgment  of  the  circuit  court  must 
be  affirmed.     The  other  justices  concurred. 


WHEN    TITLE    PASSES. 


125 


Ex  parte  CRAWCOUR. 

In  re  ROBERTSON. 

(9  Ch.  Div.  419.) 

Court  of  Appeal.    .June  27,  1878. 

This  was  an  appeal  from  a  decision  of  Mr. 
R^'illstrar  Hazlitt,  acting  as  chief  judge  in 
baulcruptcy. 

On  the  liittli  of  November.  1877,  an  agree- 
n'cut  in  writing  was  entered  into  between 
^^^  a.  Robertson,  a  trader,  of  the  one  part, 
and  I^win  Crawcour  «&  Co..  upholsterers,  of 
the  other  part,  which  contained  the  following 
provisions: — 

(1.)  "That  Lewin  Crawcour  &  Co.  thereby 
let  to  Robertson,  and  he  thereby  hired  of 
tilt  m.  the  several  articles  of  furniture  and  ef- 
fects belonging  to  them  mentioned  in  the 
.schedule  thereto,  and  which  were  admitted  by 
Robertson  to  be  of  the  value  of  £l>3  4s.  lOd., 
adding  thereto  o  per  cent,  on  the  said  value 
less  the  amount  of  first  instalment. 

(2.)  "The  said  articles  of  furniture  and  ef- 
fects are  hired  by  AV.  A.  Robertson  upon  the 
following  terms  and  conditions: — 

(S.)  "W.  A.  Robertson  is  to  pay  to  Lewin 
Crawcour  &  Co.  the  sum  of  £10  on  the  signing 
heieof,  £.5  on  the  4th  of  January  next,  and  £5 
on  th?  4th  day  of  each  succeeding  calendar 
month  diu'ing  the  continuance  of  this  agree- 
ment, and  is  also  on  the  signing  hereof  to  de- 
posit with  Lewin  Crawcour  &  Co.  promissory 
notes  for  the  total  amount  of  the  instalments 
to  be  paid  hereunder,  such  promissory  notes 
being  given  as  collateral  security,  and  entire- 
ly without  prejudice  to  the  title  of  Lewiu 
Crawcour  &  Co.  in  or  to  the  said  furnitin-e 
and  effects,  and  of  all  rights  reserved  to  them 
by  this  agreement,  and  subject  to  this  stipu- 
lation, that,  in  case  of  the  goods  being  seized 
and  removed  by  Lewin  Crawcour  &  Co.  under 
clause  5.  the  whole  of  such  promissory  notes, 
or  so  many  of  them  as  shall  then  be  current, 
shall  after  such  seizure  and  removal  be  given 
up  on  demand  to  W.  A.  Robertson,  and  shall 
from  and  after  such  seizure  and  removal  be- 
come absolutely  void. 

(4.)  "W.  A.  Robertson  is  to  keep  the  rent  of 
the  premises  in  which  the  said  furniture  and 
effects  are  placed  regularly  and  punctually 
paid,  and  not  to  part  with  possession  of,  re- 
move, or  otherwise  deal  with  the  said  goods, 
or  any  part  thereof,  nor  to  part  with  the  pos- 
session of,  or  assign  his  interest  in.  the  house 
or  premises  wherein  the  said  goods  may  be, 
without  the  consent  in  writing  of  Lewin 
Crawcour  &  Co   being  first  ol)tained. 

(5.)  "In  the  event  of  non-payment  of  any  of 
the  above  notes  on  the  days  upon  which  they 
respectively  become  due.  or  of  the  breach  of 
any  of  the  conditions  heiein  expressed  to  be 
performed  by  AV.  A  Roljertson,  or  in  case 
the  said  fxu'uiture  and  effects,  or  any  part 
thereof  shall  be  seized  or  taken  in  execution 
under  any  process  of  any  coiu't  either  of  law 
or  of  equitj-,  Lewin  Crawcour  &  Co.  may  by 
themselves,  or  others,  their  servants  or  agents. 


enter  into  any  house  or  place  where  the  said 
articles  of  f  uruitin-e  or  any  of  them  shall  then 
be.  and  seize,  remove,  and  retake  possession  of 
the  same,  as  in  their  first  and  former  estate, 
notwithstanding  any  payments  made  by  W. 
A.  Robertson,  and  Roljertson  shall  be  l)arred 
from  commencing  or  maintaining  any  action  of 
trespass  or  otherwise  by  reason  of  such  taking 
possession  as  aforesaid,  or  of  the  temporary 
possession  of  the  premises  wherein  the  said 
goods  may  be.  for  such  time  as  may  be  rea- 
sonably occupied  in  such  removal,  or  for  the 
recovery  of  any  part  of  the  montws  paid  un- 
der this  agreement,  which,  upon  such  default 
or  breach  as  afoiesaid.  it  is  hereby  agreed  are 
to  be  absolutely  forfeited  to  lA'win  Crawcour 
&  Co. 

(0.)  '"T'pon  payment  by  W.  A.  Rol)ertson  to 
Lewin  Crawcour  &:  Co.  of  the  full  sum  of  £«m 
17s.  Itkl.  by  the  instalments  aforesaid  the 
agreement  shall  be  deemed  completed,  and 
shall  thenceforth  close  and  determine,  and  the 
said  furniture  and  effects  shall  become  and  be 
the  property  of  W.  A.  Robertson;  but  until 
the  whole  of  the  said  sum  shall  have  been 
paid  the  said  articles  of  furnitine  and  effects 
shall  remain  the  sole  and  absolute  property  of 
Lewin  Crawcour  ct  Co..  and  are  only  let  on 
hire  to  W.  A.  Robertson,  who  hereby  agrees 
to  take  all  proper  care  of  the  same  during  the 
hiring,  and.  in  case  of  damage  by  fire  or  oth- 
erwise, W.  A.  Robertson  will  l)ear  the  loss  or 
risk." 

The  articles  mentioned  in  the  schedule  to 
the  agreement  consisted  of  ordinary  house- 
hold furniture.  Soon  after  the  execution  of 
the  agreement  they  were  delivered  at  Robert- 
son's private  residence.  On  the  9th  of  Janu- 
ary, 1878,  Robertson  filed  a  liquidation  i)eti- 
tion,  under  whicn  a  trustee  was  appointed, 
who,  on  the  2Gtli  of  Fel)ruary.  took  posses- 
sion of  the  furniture  comprised  in  the  agree- 
ment of  the  29th  of  November.  1877.  which 
was  still  in  debtor's  house,  and  remained  in 
possession  of  it  until  the  19th  of  March,  1878, 
when  Lewin  Crawcour  «&  Co.  took  possession 
of  it.  The  instalments  of  rent  due  in  Febru- 
ary and  March  had  not  been  paid.  On  the 
22ud  of  March  the  trustee  obtained  from  the 
court  of  bankruptcy  an  injumtion  restraining 
Lewin  Crawccur  <&  Co.  from  removing  the 
furniture,  and  the  injunction  was  continued 
from  time  to  time.  On  the  3nth  of  Mai'ch  the 
trustee  gave  notice  of  an  application  to  the 
court  for  an  order  declaring  that  the  furniture 
formed  part  of  the  property-  of  the  debtor 
divisible  among  his  creditors,  and  belonged  to 
the  trustee.  This  appliiation  was  heard  on 
the  24th  of  May,  1878.  On  behalf  of  the  tms- 
tee  it  was  contended  that  the  hiring  agreement 
was  void  as  against  him.  because  it  had  not 
been  registered  imder  the  bills  of  sale  act. 
1854;  and.  moreover,  that  he  was  entitled  to 
the  furniture  as  being,  at  the  commencement 
of  the  liquidation,  in  the  order  and  disposi- 
tion of  the  debtor,  with  the  consent  of  the 
tiiie  owners.  On  the  latter  point  a  number 
of  affidavits  were  filed  by  Lewin  Crawcour  & 


126 


WHEN  TITLE  PASSES. 


Co.  to  prove  that  there  is  a  notorious  custom 
of  letting  furniture  upon  terms  .similar  to  those 
of  the  agreement  of  the  2yih  of  November, 
1877,  and  it  was  said  that  this  custom  ex- 
cluded tlie  opei-ation  f)f  tlie  reputed  owner- 
ship clause.  These  affidavits  were  answered 
by  a  number  of  attidavits  filed  on  behalf  of  tlie 
trustee,  which  denied  the  existence,  or  at  any 
rate  the  notoriety,  of  any  such  custom.  The 
registrar  held  that  the  agreement  ought  to 
have  been  registered  as  a  bill  of  sale,  and  that, 
by  rea.son  of  its  non-registration,  it  was  void 
as  against  the  trustee;  and  on  this  ground, 
witliout  going  into  the  question  of  order  and 
disposition,  he  made  the  order  asked  for, 
granting  a  perpetual  injunction  to  resti-ain 
Lewin  Crawcoiu-  &  Co.  from  interfering  witli 
the  furniture.  Lewin  Crawcour  «)c  Co.  ap- 
pealed. 

AViuslow,  Q.  C.  and  Finlay  Knight,  for  ap- 
pellants.    Yate  Lee,  for  trustee. 

JIOSSEL,  M.  R.: — I  cannot  concur  in  the 
ground  of  the  registrar's  decision.  Whether 
it  can  be  supported  on  other  grounds  will  be 
a  matter  for  discussion  at  a  future  time.  The 
registrar  rested  the  title  of  the  trustee  simply 
on  this,  that  the  agreement  was  a  bill  of  sale, 
and  that  it  was  void  as  against  the  trustee 
because  it  was  not  registered.  It  appears  to 
me  that  the  agreement  was  not  a  bill  of  sale 
by  Robertson,  who  is  the  person  by  whom  a 
bill  of  sale  must  have  been  executed  if  it  is 
to  be  hit  by  the  bills  of  sale  act.  Robertson 
never  had  any  property  in  the  goods.  Craw- 
cour &  Co.,  to  whom  they  originally  belonged, 
agreed  to  let  them  on  hire  to  Robertson  at  a 
rent  to  be  paid  by  instalments,  with  this  fur- 
ther provision,  that,  until  all  the  instalments 
had  been  paid,  the  pr  iperty  should  remain  in 
Crawcour  «&  Co..  and  that,  if  any  instalment 
should  not  be  paid  when  it  became  due,  tliey 
should  be  at  liberty  to  retake  pos.sessiou  of 
their  own  goods,  and  the  instalments  already 


paid  should  be  forfeited  to  them.  Tliat  does 
not  make  the  document  a  bill  of  sale  executed 
by  I{ol)e:'*^son,  or  a  license  given  by  him  to 
take  possession  of  personal  chattels  as  secu- 
rity for  a  debt.  It  is  simply  one  of  the  terms 
of  the  letting  for  hire  and  conditional  sale  of 
the  goods  by  Crawcour  &  Co.  to  him.  When 
tlie  liciuidation  petition  was  filed,  some  instal- 
ments of  tlie  rent  lieing  overdue,  Crawcour  & 
Co.  attempted  to  take  poss  ss  on  of  thdr  gocds. 
It  appears  to  me  that  they  were  entitled  to  do 
so.  and  tliat  there  was  no  reason  for  granting 
the  injunction. 

JAMES,  L.  J.:— I  am  of  the  same  opinion. 

BRETT,  L.  J.:— It  is  said  that  this  agree- 
ment contains  a  license  by  Robertson  to  Craw- 
cour tfe  Co.  to  take  possession  of  his  goods, 
and  that  it  therefore  amounts  to  a  bill  of  sale 
witliin  sect.  7  of  the  Ijills  of  sale  act.  The 
only  way,  however,  in  which  Robertson  could 
have  any  interest  in  the  goods  or  any  right  to 
deal  with  tliem  was  by  virtue  of  the  agree- 
ment itseif.  It  is  said  tliat  the  agreement 
passed  the  property  in  the  goods  to  Robert- 
.son,  and  that  by  it  he  at  the  same  time  mort- 
gaged the  goods  to  Crawcour  &  Co.,  and  gave 
them  a  lici'use  to  seize  them.  Tlie  sole  ques- 
tion therefore  is,  whether  the  property  in  the 
goods  passed  to  Robertson.  In  my  opinion 
the  property  did  i-ot  pass  by  the  agreement. 
To  hold  tliat  it  did  Avould  be  clearly  contrary 
to  the  expressed  intention  of  the  parties.  Nor 
do  I  think  that  the  property  passed  by  the  de- 
livery of  the  goods,  which  was  made  in  ac- 
cordance with  the  agreement.  In  my  opinion 
the  propertj  could  not  pass  until  all  the  in- 
stalments had  been  paid,  and  that  lias  not 
been  done  yet. 

The  appeal  was  allo\^ed,  with  costs  fixed  at 
£20.  and  the  cse  was  referred  back  to  the 
registrar  to  try  the  question  of  reputed  owner- 
ship. 


WHEN  TITLE  PASSES. 


127 


FIRST  NAT.   BANK   OF  CAIRO   v. 
CROCKER  et  al. 

(Ill  Mass.  163.) 

Suprfine  .Tudicial  Court  of  Massiirliusctts.     Suf- 
folk.    Nov.,  1S72. 

Tort  a^'ainst  Crocker,  Smith  &  Co.  for  the 
couversion  of  100  barrels  of  flour.  It  api)ear- 
ed  on  the  trial  that  Ayers  &  Co.,  of  Cairo,  Il- 
linois, had  dealt  with  defendant  conuuission 
inerc'liants  in  Boston  for  some  years,  sliii)i)in^ 
them  lionr  on  consisimient,  for  sale  in  Bos- 
ton, and  having  an  open  >;eneral  consijiinnent 
account  with  them.  Ayers  &  Co.,  on  August 
2;],  1870,  consigned  to  them  some  tlour,  and 
drew  on  them  for  more  than  its  value,  writing 
them  that  they  would  make  it  all  right  in  the 
next  shipment.  The  defendants  i)aid  the  draft, 
Avhicli  left  Ayers  »fc  Co.  indebted  to  defendants 
for  about  .l^l.ijOO.  On  August  24.  1870,  Ayers 
&^  Co.  shipped  the  100  barrels  of  flom-  in  dis- 
pute to  Boston,  taking  a  bill  of  lading  "con- 
signed to  shipper's  order  Boston,  Mass.,"  but 
on  which  was  written  "St.  Louis  Mills  and 
Blackburn.  For  Crocker,  Smith  &  Co..  Bos- 
ton, Mass."  They  then  drew  on  defendants 
with  bill  of  lading  attached,  and  discounted  the 
draft,  which  defendants  refused  to  accept,  and 
it  was  retiu'ued  to  defendants  with  the  bill  of 
lading.  When  the  flour  arrived  in  Boston, 
Septend)cr  12,  1870,  it  was  accompanied  by  a 
way  bill,  on  which,  tuidei'  "Consignees,"  was 
written  "Crocker,  Smith  tfc  Co.,  Boston;"  and 
the  Hour  was  received  by  them  and  sold,  and 
applied  to  the  account  of  Ayers  »fc  Co.  Sep- 
tember 14,  1870,  Ayers  »S:  Co.  drew  a  draft  on 
account  of  the  100  barrels  of  flour  on  (Good- 
win, Locke  &  Co.  of  Boston,  in  favor  of  plain- 
tiffs, and  attached  to  it  the  bill  of  lading.  The 
draft  was  accepted  and  paid  Avhen  due.  The 
bill  of  lading  was  indorsed  in  blank  when  de- 
livered by  Ayers  &  Co..  but  when  for^^•al■ded 
by  plaintiffs  the  words  "Deliver  within-named 
flour  to  Goodwin,  Locke  &  Company,  or  order," 
were  written  over  the  indorsement  of  Ayers 
&  Co. 

A.  Churchill  and  J.  E.  Hudson,  for  plaintiffs. 
A.  A.  Ranney,  for  defendants. 

AjNIES,  J.  It  is  manifest  that  the  flour  was 
not  placed  in  the  hands  of  these  defendants 
for  the  purpose  of  securing  an  existing  debt,  or 
indemnifying  them  for  any  advances  that  they 
had  made.  It  was  not  consigned  to  them  in 
order  that  it  might  be  sold,  and  the  proceeds 
carried  to  the  ciedit  of  Ayers  &  Company  in 
general  account  current.  It  is  true  that  the 
consignors  knew  that  they  had  overdrawn 
their  account,  and  that  they  had  expressly 
promised  to  "make  it  all  right"  at  the  next 
sliipnu>nt.  But  that  was  an  executory  con- 
tract. The  proposed  corri'ction  stood  wholly  in 
agreement.  A  general  promise  to  make  the 
matter  right  was  not  of  itself  sutticient  to 
vest  in  the  defendants  a  title  as  absolute  own- 
ers, even  of  the  goods  forwarded  at  the  next 
shipment,  unless  the  circmnstances  indicated, 
or  at  least  Avere  consistent  with,  such  an  in- 


tention on  the  part  of  the  shippers.  But  in  tliis 
ca.se,  the  consignment  and  the  draft  consti- 
tuted one  transaction.  The  bill  of  lading  and 
the  di'aft  came  together;  and  the  defendants 
underst(X)d  that  the  flour  was  sent  to  them, 
subject  to  a  claim  of  .$.")00  in  favor  of  the  hold- 
er of  the  draft.  They  were  to  receive  it  upon 
the  trust  that  they  were  to  pay  that  amount 
out  of  the  proceeds.  The  meaning  of  tlie  trans- 
action on  the  part  of  the  shippers  was  that 
the  defendants  were  to  receive  it  for  that 
pinpo.se  and  upon  that  miderstanding  only.  It 
was  as  if  they  had  said,  "You  may  take  this 
flour  and  sell  it  on  oui-  account,  provided  you 
will  accept  this  draft."  A  bill  of  lading  in- 
dorsed is  only  prima  f.-icie  evidence  of  owner- 
ship, and  is  open  to  explanation.  I'ratt  v. 
Parkman,  24  Pick.  42.  This  bill  of  lading  was 
l)iovisional,  and  was  not  intended  to  vest  the 
property  in  the  defendants,  or  to  authorize 
their  taking  possession  of  it,  except  upon  the 
condition  of  their  acceptance  of  the  draft.  Al- 
len V.  Williams,  12  Pick.  207. 

The  act  of  the  defendants,  therefore,  in  tak- 
ing possession  of  the  flour  was  wholly  unau- 
th.orized,  and  gave  them  neither  valid  title 
nor  lawful  possession.  AUen  v.  Williams,  ubi 
supra.  In  proceeding  afterwards  to  sell  it  as 
if  it  were  their  own,  and  appiopriating  the 
proceeds,  they  were  guilty  of  a  wrongful  con- 
version. A  carri(>r  may  be  a  mere  bailee  for 
the  consignor;  and  where  by  the  tenns  of  the 
bill  of  lading  the  goods  are  to  be  delivered  to 
the  consignor's  order,  the  carriei-  is  his  agent, 
and  not  the  consignee's.  Moakes  v.  Nicolson, 
19  C.  B.  (N.  S.)  2il0;  Baker  v.  Fullei',  21  Pick. 
.^ibS;  MeiThants'  Nat.  Bank  v.  Bangs,  102 
Mass.  2i)l.  On  the  refusal  of  the  consignee  to 
receive  the  goods  tipon  the  terms  and  for  the 
purposes  for  which  they  were  sent,  he  cannot 
take  them  for  any  other  purpose.  Shepherd  v. 
Harrison,  L.  R.  5  II.  L.  IIG;  De  Wolf  v.  Gard- 
ner, 12  Cush.  v.),  23;  Allen  v.  Williams.  12 
Pick.  297.  The  title  to  the  flour  therefore  re- 
mained in  the  shipper,  wholly  unaffected  by 
tlie  consignment.  Even  in  the  case  of  a  con- 
tract of  sale,  the  fact  of  nniking  the  bill  of 
lading  deliverable  to  the  order  of  the  vendor, 
Avlieu  not  rebutted  by  evidence  to  the  con- 
trary, is  decisive  to  show  his  intention  to  pre- 
serve the  jus  disponendi,  and  to  prevent  the 
property  from  passing  to  the  vendee.  Wait  v. 
Baker,  2  Exch.  1;  Van  Casteel  v.  Booker,  Id. 
(iUl.  The  case  of  a  mere  consignment  to  an 
agent  would  be  of  course  still  stronger. 

Upon  the  refusal  of  the  defendants  to  accept 
the  consignment  upon  the  terms  proposed, 
which  refusal  was  sutflciently  manifested  by 
the  protest  of  the  draft  and  the  return  of  the 
bill  of  lading,  the  owners  of  the  flour,  Ayers  iVc 
Company,  had  a  right  to  seek  a  new  consignee, 
and  to  make  another  attemiit  to  obtain  an  ad- 
vance by  a  draft  to  be  charged  against  the 
property.  .\n  arrangement  was  accordingly 
made  with  the  plaintiffs,  who  discounted  their 
draft  of  if400  upon  the  security  of  the  same 
bill  of  lading  that  had  been  sent  to  the  de- 
fendants and  returned  by  them.     If  this  bill 


128 


whp:n  title  passp:s. 


•of  latliug  was  rtcliveied  to  the  plaintiffs,  in- 
dorsed in  blank  by  Ayers  &  Company,  (and 
tlioie  is  testimony  to  that  effect.)  the  transac- 
tion would  optMate  as  a  transfer  of  their  title 
in  the  flour  to  the  plaintiffs,  if  such  were  the 
intention  of  the  iiarties.  As  The  property  was 
at  that  time  in  Huston,  it  was  of  course  in- 
capable of  actual  delivery  at  Cairo,  and  the 
delivery  of  the  evidence  of  title,  Avith  tlie  in- 
dorsement ui)on  the  bill  of  ladinj;.  wa.s  all  that 
could  be  done  for  the  transfer  of  the  property 
from  the  general  owner  to  the  new  purchaser; 
but  it  would  be  effectual  for  that  purpose. 
Conard  v.  Atlantic  Ins.  Co.,  1  Pet.  386.  445; 
Gibson  v.  Stevens,  8  How.  384;  Bryans  v.  Nix, 
4  M.  &  W.  775,  71)1;  Low  v.  De  Wolf.  8  Pick. 
101;  Gardner  v.  Howlaud,  2  Pick,  .jlt!);  Stan- 
ton V.  Small,  3  Sandf.  230;  Pratt  v.  Parkman, 
24  Pick.  42.  In  Gibson  v.  Stevens,  the  court 
say,  per  Taney,  C.  .T.:  "This  rule  applies  to 
•every  case  where  the  thing  sold  is,  from  its 
oharactej"  or  situation  at  the  time,  incapable  of 
iictual  delivery."'  To  the  extent  of  their  ad- 
vance of  money  upon  the  draft,  therefore,  the 
plaintiff's  would  be  considered  as  purchasers, 
•and  they  would  acquire  a  special  property  in 
the  flour  for  the  purpose  of  protecting  the 
•tbaft.  At  the  time  of  this  transaction,  the 
flour  remained  in  the  possession  of  the  de- 
fendants, and,  with  the  exception  of  taking 
possession,  nothing  had  been  done  on  their 
part  amounting  to  a  wrongful  conversion  of  it 
to  their  own  use.  They  had  not  put  it  out  of 
their  power  to  replace  tlie  shippers  in  the 
enjoyment  of  their  rights. 

It  appears  from  the  report,  that,  when  the 
bill  of  lading  was  forwarded  the  second  time, 
the  name  of  the  firm  of  Goodwin.  Locke  & 
•Company  was  written  over  the  indorsement 
•of  Ayers  &  Company.  But  we  do  not  think 
that  this  fact,  whether  the  blank  indorsement 
■were  tilled  up  after  or  before  the  discount 
of  the  draft,  woiild  materially  affect  the  plain- 
tiff's' rights.  The  bill  of  lading  was  attached 
to  the  draft,  and  the  substance  of  the  trans- 
action was  that  the  draft  was  discounted  upon 
the  securitj'  of  the  merchandise  itself.  It  pur- 
ports to  be  on  account  of  the  barrels  of  flour 
described  in  the  bill  of  lading.  The  flour,  al- 
though intrusted  to  Goodwin,  Locke  &  Com- 
pany to  sell,  was  appropriated  to  the  specific 
purpose  of  the  payment  of  this  draft.  The 
bill  of  lading  was  put  in  the  plaintiffs'  hands 
to  enable  them  to  bold  the  merchandise  as 
their  security,  and  the  discounting  of  the  draft 
Avas  the  consideration  for  the  transfer  of  the 
property  to  them.  It  was  convenient  so  to 
indorse  the  bill  of  lading,  as  to  make  it  man- 
ifest that  Goodwin,  Locke  &  Company  were 
to  receive  and  dispose  of  the  goods;  but  they 
were  to  do  so  as  trustees  and  agents  of  the 
plaintiff's,  and  not  as  proprietors  in  their  own 
right.  They  certainly  acquired  no  title  in  the 
property  until  they  had  accepted  the  draft, 
and  when  that  event  happened  the  goods  had 
been  dispensed  of  by  the  defendants,  and  had 
gone  into  the  hands  of  bona  fide  holders  with- 
out notice,  so  as  to  be  bej-ond  recall.    The  ef- 


fect of  this  transaction  between  the  plaintiffs 
and  Ayers  &  Company  was  that  the  flour  was 
designated  to  stand  as  collateral  security  for 
the  draft.  If  the  draft  had  not  been  accepted, 
the  plaintiffs  clearly  would  not  have  lost  their 
title  to  the  flour.  It  is  not  necessary  to  hold 
that  the  plaintiff's  became  absolute  owners  of 
the  property-;  it  is  enough  that  they  had  a 
right  of  propcMty  and  possession  to  secure  the 
payment  of  the  draft,  and  the  right  of  Ayers 
&  Company  as  former  owners  of  the  specific 
property  had  become  divested,  leaving  them 
only  a  right  in  the  surplus  money  which  might 
remain  after  a  sale  of  the  flour  and  a  payment 
of  the  draft  from  the  proceeds.  De  Wolf  v. 
Gardner,  12  Cush.  10,  has  iu  many  re.spects  a 
close  analogy  with  this  case.  There  the  gen- 
eral owner  of  the  flour  was  the  plaintiff',  and 
the  defendant  was  a  party  claiming  under  the 
new  consignee,  and  the  court  held  that  the 
plaintiff  had  parted  with  the  right  of  property, 
and  could  not  maintain  his  action.  In  Bank 
of  Rochester  v.  Jones,  4  N.  Y.  497,  as  in  the 
case  at  bar,  the  plaintiff's  had  discounted  a 
draft  drawn  by  the  owner  of  a  quantity  of 
flour  upon  the  defendant,  who,  as  in  the  case 
at  bar,  refused  to  accept  the  draft,  and  claim- 
ed to  hold  the  flour  and  sold  it  for  the  pay- 
ment of  a  balance  due  from  the  drawer.  In- 
stead of  a  bill  of  lading,  there  had  been  a 
carrier's  receipt,  which  the  drawer  delivered, 
unindorsed,  to  the  plaintiff  bank.  The  agree- 
ment was  that  the  bank  should  hold  the  flour 
as  security  that  the  draft  should  be  accepted, 
but  with  power  to  sell  it  if  the  draft  should 
not  be  accepted.  The  court  of  appeals  held 
that  the  defendant  could  not  acquire  any  prop- 
erty in  the  flour,  except  by  performance  of  the 
condition  imposed,  namely,  the  acceptance  of 
the  draft;  that  the  transaction  between  the 
consignor  and  the  plaintiff'  bank  gave  to  the 
latter  a  general  or  special  property  in  the , 
flour;  that  the  transaction  constituted  a  sale 
to  the  bank  in  trust  for  the  fulfillment  of  the 
agreement;  that  the  carrier's  receipt,  though 
not  indorsed,  was  sutficient  evidence  of  the 
plaintiff"s  right  of  possession;  and  that  the 
statute  of  frauds  was  not  applicable,  as  the  de- 
livery of  the  receipt,  in  consideration  of  the 
discount  of  the  draft,  Avas  sutficient  to  trans- 
fer the  title.  In  legal  effect,  and  for  the  pur- 
pose of  explaining  what  is  to  be  done  with 
the  merchandise,  there  can  be  no  substantial 
diff'ereuce  between  a  bill  of  lading  and  a 
carrier's  receipt. 

^Ve  have  then  in  this  case  an  intent  of  the 
general  owners  of  the  flour  to  make  use  of  it 
as  a  securitj'  for  an  advance  of  monej-  from 
the  plaintiffs;  a  delivery  of  the  bill  of  lading 
iu  pursuance  of  that  intent;  and  a  valuable 
and  executed  consideration  in  the  discounting 
of  the  draft.  The  fact  that  the  goods  were  in 
the  custody  of  the  defendants  would  not  pre- 
vent this  arrangement  from  having  the  effect 
to  transfer  the  title  of  Ayers  «&  Company  to 
the  plaintiffs.  Whipple  v.  Thayer.  10  Pick. 
25;  McKee  v.  .ludd.  12  N.  Y.  ()22.  Whether  it 
should  be  regarded  as  a  sale,  a  ple;1ge  or  a  mort- 


WHEN  TITLE  PASSES. 


129 


gage,  there  was  a  sufficient  deliveiT  to  give 
to  tlie  plaintiffs  a  special  property,  which  they 
could  enforce  bj-  suit  against  any  wrongdoer. 
They  liad  a  right  to  transfer  the  property,  sub- 
ject to  the  same  trusts  upon  which  they  held 
it  themselves,  to  their  correspondent  or  agent 
in  Boston,  and  it  may  well  be  that,  if  the  draft 
had  been  accepted  by  Goodwin,  Locke  .& 
Company  before  the  flour  had  been  sold  and 
placed  out  of  their  reach,  they  woulil  have 
been  the  proper  parties  to  have  brought  this 
action.  Rut  the  transfer  to  them  for  that  rea- 
son wliolly  failed  to  take  effect,  and  they  ac- 
quired no  title  to  the  flour  specifically.  If 
they  had  accepted  the  draft  before  the  flour 
had  been  sold  to  a  bona  fide  purchaser,  the 
case  would  have  been  almost  exactly  like 
Allen  V.  Williams,  above  cited.  That  was  a 
case  in  which  the  consignee  of  merchandise 
refused  to  accept  the  draft  which  accompanied 
the  bill  of  lading,  and  took  possession  of  the 

VAN  ZILE  SEL.CAS.SALES  — 9 


merchandise,  claiming  as  in  this  case  the 
right  to  do  so  in  order  to  secure  a  balance 
due  to  him  from  the  consignor.  The  court 
held  that  a  new  consignee  could  maintain 
trover  against  him. 

Our  conclusion  then  is,  that  at  the  time  of 
the  sale  of  the  flour  by  the  defendants,  the 
plaintiffs  had  a  right  and  property  in  it, 
which,  whether  geneial  or  special,  and  whether 
as  purchasers,  trustees,  pledgees  or  mortgagees, 
gave  them  a  right  of  possession  as  against 
all  wrongdoers;  and  that  the  defendants  had 
no  title  whatever  and  were  mere  wrongdoers. 
The  fact  that  the  draft  has  been  paid  by 
the  new  consignees  does  not  prevent  the 
plaintilTs  from  maintaining  the  action  for  the 
benefit  and  protection  of  the  acceptors  of  the 
draft,  who  without  fault  of  their  own  have 
been  deprived  of  the  security  upon  which  it 
was  discounted. 

Judgment  for  the  plaiutiffs. 


130 


WHEN  TITLE  PASSES. 


MACOMBER  el  al.  t.  PARKER. 

(13  Pick.  IT.".) 

Supreine  Judicial   Court  of  Massachusetts. 
Middlesex.    Oct.  20,  1832. 

Replevin  for  three  kilns  of  bricks  attached 
by  the  defendant  on  several  writs  against 
Jc  seph  Evans.  Plea,  property  in  Evans. 
lU'pllcatlon,  property  in  the  plaintiffs.  Trial 
before  Shaw,  C.  J. 

It  was  proved  that  Iluntinj;  &  Lawrence 
had  a  certain  brick-yard  in  Cambridge,  origi- 
nally leased  by  A.  Binney  to  .T.  AVilson,  who 
assigned  the  lease  to  Hunting  &  Lawrence. 

On  the  1st  of  March,  1829,  the  following 
agreement  was  made  between  Hunting  «& 
Lawrence  on  one  part  and  Evans  on  the  oth- 
er:—";Memorandum  of  an  agreement  &c. 
showeth,  that  said  Evans  has  agreed  to  make 
or  cause  to  be  made  from  eight  to  ten  hun- 
dred thousand  good  merchantable  brick  in 
the  brick-yard  at  Cambridge  «fec.;  said  Evans 
agrees  to  hire  the  men  and  board  to  the  best 
advantage,  to  perform  the  manufacturing  of 
said  brick,  and  said  Evans  agi-ees  to  give  in 
his  time  and  services  in  making  said  brick; 
and  said  Hunting  &  Lawrence  agree  to  at- 
tend to  selling  of  brick,  purchasing  of  woo'd 
and  all  necessaiy  materials  for  the  manufac- 
turing, collecting  the  bills  &e.  to  the  best 
advantage,  and  after  the  brick  are  made, 
and  tlie  labor  and  board  of  the  men  are  paid, 
and  all  materials  and  tools  of  eveiT  kind  are 
paid  for,  and  the  said  Evans  paying  to  said 
Hunting  «fe  Lawrence  sixty  cents  per  thou- 
sand for  each  and  every  thousand  brick 
made  or  claj-  sold,  as  rent  therefor,  then  the 
parties  agree  to  share  the  profits  or  loss,  as 
the  case  may  be,  one  half  each;  said  Evans 
agrees  to  pay  every  attention  to  have  the 
brick  made  in  the  best  manner  and  in  good 
season  for  making  brick;  said  Hunting  & 
I>awrence  shall  have  full  power  to  retain 
said  Evans's  pa.t  of  the  brick  or  money  col- 
lected or  debts  due  for  brick  &e.,  in  their 
possession,  to  the  amount  of  all  sums  of  mon- 
ey now  due  from  said  Evans  and  such  other 
sums  of  money,  goods  &c.,  as  they  may  from 
time  to  time  advance  him;  all  of  which  the 
parties  agree  to  perform  according  to  the 
true  intent  and  meaning." 

No  lease  of  the  yard  was  given  to  Evans, 
and  Hunting  testified  that  Hunting  &  Law- 
rence expected  to  secure  to  themselves  by 
the  foregoing  contract,  a  lien  on  the  bricks  to 
be  manufactured  in  pursuance  thereof,  for 
the  payment  of  any  balance  that  miglit  be 
due  them. 

'1  he  plaintiffs  offered  to  prove,  that  under 
such  contracts  for  the  manufacture  of  bricks, 
it  is  customary  for  the  owners  of  yards  to  re- 
tain all  in  their  hands  and  account  with  the 
n-.akers  of  bricks  for  their  share  of  the  prof- 
its, after  the  sales  are  made  and  the  proceeds 
collected.  TliLs  evidence  was  rejected  by  the 
court. 

On  the  3d  of  July  1829,  Hunting  ,.V:  Law- 


rence stopped  payment  and  assigned  all  their 
property,  including  the  brick-yard  and  all 
their  interest  therein  and  property  thereon, 
to  the  plaintiffs,  for  the  benefit  of  the  cred- 
itors of  the  assignors,  and  on  the  same  day 
delivered  possession  of  the  yard  and  all  the 
property  thereon  to  the  plaintiffs,  in  presence 
o/  Evans;  and  the  plaintiffs  then  and  there- 
appointed  Evans  their  agent,  by  a  writing  as 
follows:— "You  will  please  take  the  charge 
and  care  of  all  the  property  and  effects  in 
and  about  the  brick-yard  &c.,  the  said  prop- 
erty having  been  this  day  assigned  to  us  <Jtc., 
you  will  proceed  to  sell  the  same  at  retail 
until  fui'ther  orders  from  us,  for  cash  only, 
and  whenever  $100  is  received,  you  will  de- 
posit the  same  in  the  Branch  Bank  to  our 
credit.  Please  keep  and  render  us  an  exact 
account  of  your  doings  herein." 

Hunting  &  Lawrence  mad^  large  advances 
for  the  yard  in  1829.  Evany  as  agent  of  the 
plalntlfTs,  thus  appointed,  sold  bricks  to  di- 
vers persons. 

On  Friday,  February  26,  1830,  the  plaintiffs 
put  a  stop  to  sales  by  Evans,  and  directed 
Hunting,  who  had  been  their  agent  in  the 
business  of  the  yard,  to  make  a  final  settle- 
ment with  Evans;  and  Hunting  and  Evans 
thereupon  looked  over  the  statements  and  ac- 
counts and  cast  them  up  for  that  purpose. 

Hunting  testified  that  at  this  settlement 
Evans  agreed  to  cart  all  the  bricks;  the  com- 
mon bricks,  at  five  shillings  per  thousand. 
No  price  was  fixed  for  the  faced  bricks.  Up- 
on the  settlement,  the  witness,  in  behalf  of 
the  assignees,  agreed  to  take  all  the  bricks 
at  certain  estimated  prices.  The  assignees 
n^tant  to  take  all  the  property  and  allow 
Evans  his  half  in  account.  The  bricks  were 
estimated  at  370  thousand,  and  at  the  esti- 
mated prices  amounted  to  ^18.30;  the  boai'd 
&c.  at  $200;  making  $2030.  Taking  the 
wiiole  to  the  account  of  the  assignees  and 
crediting  p]vans  his  part,  there  would  still  be 
a  balance  due  to  the  assignees,  which  was  to 
be  paid  in  carting.  It  was  agreed,  that  if 
the  bricks  overran  the  estimated  number,  the 
assignees  should  account  to  Evans,  and  if 
they  fell  short,  he  should  account  to  them, 
for  the  difference.  They  were  to  be  counted 
in  the  course  of  the  ensuing  week.  It  was 
agreed  that  this  should  be  a  definitive  set- 
tlement, as  Evans  was  not  to  take  the  yard 
again.  Nothing  remained  but  to  count  the- 
bricks,  and  make  the  allowance  on  the  one 
side  or  the  other,  if  tl^e  number  varied  from 
the  estimate.  On  cross-examination  the  wit- 
ness testified,  that  at  this  settlement  there 
was  an  express  understanding  with  Evans, 
that  the  assignees  w'ere  to  take  the  bricks  to 
their  own  account;  it  was  a  sale  of  his  half. 
Evans  stated  expressly  that  the  workmen 
had  all  been  paid,  and  that  he  had  paid  all 
charges.  Evans  after  this  settlement  car- 
ried one  load  of  bricks  to  G.  W.  Blake.  Tlie 
assignees  were  to  take  Evans's  half,  as  they 
owned  one  half  before.  The  Avltness  con.sid- 
ered  the  bargain  and  sale  complete,  except 


WHEN   TITLE  PASSES. 


1:51 


that  the  bricks  were  to  be  counted.  That 
was  to  be  done  the  fore  part  of  the  ensuing 
week.  Whon  the  witness  went  over  to  take 
the  count,  he  found  the  bricks  had  been  at- 
taclied  as  the  property  of  Evan.s.  Had  it  not 
been  for  the  attachment,  a  regular  account 
current  would  have  been  settled.  The  wit- 
ness understood  that  Evans  was  to  proceed 
immediately  to  cart  the  bricks  to  Boslon, 
v.-hich  he  solicited,  but  the  final  settlement 
was  not  to  Avait  till  the  bricks  were  carted,  | 
but  was  to  be  finished  as  soon  as  thoy  were 
counted.  i 

The  defendant  was  proceeding  in  his  de- 
fence, when  a  question  arose,  whether  the 
plaintiffs  had  made  out  a  prima  facie  case. 
It  being  necessaiy  that  they  should  sTiow 
that  they  were  the  sole  owners  of  the  proper- 
ty in  these  bricks,  two  preliminaiy  questions 
aros^.  viz: — 

1.  Whether  by  tlie  terms   of  the  contract 
Evans  was  interested  in  the  bricks,  as  joint 
tenant  or  tenant  in  common,  when  they  were 
made  in  pursuance  of  the  contract  and  were  | 
fit  for  market; — 

2.  If  that  were  so,  then  whether  upon  the 
facts  stated,  such  a  sale  and  delivery  had 
been  made  by  Evans  before  the  attachment, 
as  to  divest  his  interest. 

A  nonsuit  was  ordered,  subject  to  the  opin- 
ion of  the  whole  court. 

D.  A.  Simmons  and  Gay,  for  plaiutitts. 
Butti-ick  &  Ashmun,  for  defendant. 

WILDE,    J.,    delivered   the   opinion   of  the 
court.     It  was  objected  at  the  trial,  tliat  the 
plaintiffs   had   not   made  out  a   prima   facie 
case,  and  two  questions  were  thereupon  re-  I 
served    for  the    consideration    of   the    whole  I 
court. 

1.  Whether  by  the  terms  of  the  contract 
between  Hunting  &  Lawrence  and  Evans, 
the  latter,  imder  whom  the  defendant  claims, 
was  interested  in  the  bricks  in  question  as 
joint  tenant  or  tenant  in  common,  when  they 
were  made  in  pursiiance  of  thai  contract  and 
were  fit  for  market. 

2.  If  that  were  so.  then  whether,  upon  the 
facts  proved,  such  a  sale  and  delivery  had 
been  made  by  Evans  at  the  time  of  the  de- 
fendant's attachment,  as  to  divest  his  inter- 
est. 

As  to  the  first  question,  we  are  of  opinion, 
that  by  the  terms  of  the  contract,  the  bricks 
v.hen  made  were  the  joint  propeity  of  the 
fcntracting  parties.  By  this  contract  Hum 
ing  (fc  Lawrence  were  to  furnish  the  mate-  j 
rials  for  manufacturing  the  bricks,  and  to  at- 
tend to  the  sale  of  them;  Evans  on  his  part 
undertook  to  maniifacture  the  bricks,  to  hire 
and  board  the  laborers  employed  lor  that 
purpose,  and  to  allow  Hunting  &  Lawrence 
sixty  cents  per  thousand  for  every  thousand 
of  bricks  made  or  clay  sold,  as  rent  thereof; 
and  after  all  expenses  should  be  paid,  then 
the  parties  agreed  to  share  the  profit  and 
loss,   as  the  case  might  be,   one  half  each. 


That  this  amounts  to  a  complete  contract  of 
partnership,  cannot,  we  think,  admit  of  a 
doubt.  Partnership  is  defined  to  be  a  volun- 
tary contract  between  two  or  more  persons, 
for  joining  together  their  money,  goods,  la- 
bor, and  skill,  or  either  or  all  of  them.  ui»ou 
an  agreement,  that  the  gain  or  loss  shall  be 
divided  proportionably  between  them,  (low, 
2.  With  this  definition  the  contract  in  ques- 
tion fully  agrees.  It  contains  every  essential 
requisite  in  a  contract  of  partnership.  The 
parties  agreed  to  join  together  their  property, 
skill  and  labor,  for  the  purpose  of  accom- 
plishing an  enterprise,  in  which  they  were 
to  have  a  communion  of  interest  and  a  com- 
munion of  profit  and  loss.  The  bricks,  there- 
fore, when  made  were  their  joint  property, 
and  when  the  partnership  was  dissolved,  and 
Hunting  &  Lawrence  assigned  their  share  to 
the  plaintiffs,  the  latter  became  tenants  in 
common  with  Evans. 

The  plaintiffs  offered  to  prove,  for  the  ptir- 
po.se  of  showing  that  Evans  had  no  property 
in  the  bricks,  and  was  only  entitled  to  a 
share  of  the  proceeds  of  sale  of  them  when 
disposed  of.  that  it  was  usual  and  customary 
for  the  owners  of  yards,  under  similar  con- 
tracts, to  retain  all  in  their  hands,  and  ac- 
count with  the  makers  of  the  bricks  for  their 
share  of  the  profits  after  the  sales  were  made 
and  proceeds  collected.  This  evidence  was 
rejected  by  the  judge  who  presided  at  the 
trial,  and  we  think  very  properly.  The 
usages  of  trade  may  be  admitted  to  aid  in  the 
construction  of  doubtful  contracts;  but  the 
terms  of  the  present  contract  are  by  no 
means  doubtful.  So  far  as  the  question  of 
partnership  or  of  the  right  of  property  is  con- 
cerned, the  contract  is  clearly  and  explicitly 
expressed,  and  the  supposed  usage,  if  ad- 
mitted, could  not  affect  its  construction.  It 
would  only  prove  how  otlier  parties  had  con- 
sidered similar  contracts.  Indeed,  it  woidd 
hardly  prove  so  much,  for  if  other  owners  of 
yards  had  retained  possession  of  the  proper- 
ty there  manufactured,  it  might  be  by  con- 
sent, or  for  the  convenience  of  the  parties, 
and  not  under  the  claim  of  any  legal  right. 
Besides,  the  contract  expressly  admits  that 
Evans  would  be  entitled  to  a  share  of  the 
bricks,  and  stipulates  that  Hunting  &  Law- 
rence might  retain  the  same  as  security  for 
any  balance  which  was  or  might  be  due  from 
him  to  them;  so  that  the  evidence  of  usage, 
if -it  were  admissible,  would  be  wholly  imma- 
terial. 

The  remaining  question  is.  whether  before 
the  attachment  by  the  defendant  there  was 
a  valid  sale  from  Evans  to  the  plaintiffs. 
It  is  objected  in  the  first  place,  that  the  con- 
tract of  sale  was  not  completed,  because  the 
bricks  had  not  l>cen  counted  according  to  the 
stipulation  between  the  parties  to  that  effect. 
And  if  the  counting  was  intended  by  the 
parties  to  precede  the  completion  of  the  sale, 
then  undoubtedly  the  objection  must  prevail. 
The  evidence,  however,  does  not  support  this 
objection,  but  rather  shows  that  the  sale  was 


i:]2 


WHEN   TITLE   PASSES. 


considered  as  complete  aud  absolute  at  tlie 
time  when  tbe  settlement  between  Evans 
and  the  plaintiffs  was  made;  or  at  least  the 
jury  would  be  warranted  by  the  testimony 
of  Hunting',  to  find  that  such  was  the  int<'n- 
tion  of  the  eontractinj^  parties.  Tlie  whole 
bricks  were  estimated  at  370  tliousand.  Ev- 
ans sold  his  sliare  in  the  whole  and  received 
pay  in  account,  and  a  balance  was  due  to  the 
plaintiffs  which  was  to  be  paid  for  in  carting 
the  bricks,  so  far  as  that  might  go.  It  is 
true  the  bricks  were  to  be  counted.  l)ut  that 
was  to  be  done  to  enable  the  parties  to  como 
to  a  settlement  of  their  accounts,  and  not  for 
the  purpose  of  completing  the  sale.  Taking 
the  whole  of  Hunting's  testimony  tog-etiier, 
this,  we  think,  is  the  reasonable  inference 
to  be  draAvn  from  it.  If  the  bricks  had  been 
actually  delivered,  there  could  have  been  no 
question  that  the  sale  would  have  been  com- 
plete, notwithstanding  the  bricks  were  to  be 
afterwards  counted.  The  general  principle 
is.  that  where  any  operation  of  weight,  meas- 
urement, counting  or  the  like,  remains  to  be 
performed,  in  order  to  ascertain  the  price, 
the  quantity  or  the  particular  commodity  to 
be  delivered,  and  to  put  it  in  a  deliverable 
state,  the  contract  is  incomplete  until  such 
operation  is  performed.  Brown,  Sales,  44. 
But  where  the  goods  or  commodities  are  ac- 
tually delivered,  that  shows  the  intent  of  the 
parties  to  complete  the  sale  by  the  deliveiy, 
and  the  weighing  or  measuring  or  counting 
afterwards  would  not  be  considered  as  any 
pait  of  the  contract  of  sale,  but  would  be 
taken  to  refer  to  the  adjustment  of  the  final 
settlement  as  to  the  price.  The  sale  would 
be  as  complete  as  a  sale  upon  credit  before 
the  actual  payment  of  the  price.  Nothing 
can  be  found  in  any  of  the  numerous  cases 
on  this  point,  which  militates  against  this 
position. 

We  come,  then,  to  the  second  objection  to 
the  sale,  nanielj%  that  there  was  no  deiiveiy. 


In  answer  to  this  objection  it  was  said,  as 
Evans  agreed  to  cart  the  bricks  and  did  ac- 
tually cart  one  load  after  the  sale,  this  may 
be  considered  as  a  delivery  of  a  part  under 
an  entire  sale,  and  so  according  to  the  au- 
thorities would  amount  to  a  constructive  de- 
livery of  the  whole.  Perhaps  this  may  be  so, 
but  we  do  not  think,  under  the  circumst.inccs 
of  this  case,  that  any  actual  delivery  was 
necessary.  The  plaintiffs  were  in  fact  as 
much  in  possession  of  the  bricks  as  Evans 
was;  he  was  their  agent;  the  bricks  were 
remaining  in  their  yard,  and  under  the  cir- 
cumstances proved,  a  delivery  would  be  al- 
togetlier  an  unmeaning  ceremony.  The  plain- 
tiffs accepted  the  bricks,  gave  orders  to  Ev- 
ans to  cart  them,  and  in  all  respects  treated 
them  as  their  property.  The  sale,  therefore, 
amounted  to  a  transfer,  and  was  so  consider- 
ed by  the  parties. 

Then  it  was  objected,  that  the  sale  was 
void  by  the  statute  of  frauds;  but  as  here 
was  a  delivery  of  a  pai-t,  that  alone  woiild 
take  the  case  out  of  the  statute.  But  that 
which  took  place  was  equivalent  to  a  deliv- 
ery of  the  whole,  and  therefore  the  statute 
of  frauds  can  have  no  application.  Whether 
this  sale  was  void  as  against  creditors,  is  a 
question  not  now  to  be  considered;  nor  have 
we  considered  the  question,  whether  the 
plaintiffs,  before  the  sale,  had  a  lien  on  the 
brick  as  security  for  the  balance  due  them 
from  Evans,  since  our  opinion  as  to  the  sale 
renders  this  question  immaterial.  These 
questions  may  be  raised  on  another  trial,  but 
at  present  we  couiine  ourselves  to  the  two 
questions  reserved  by  the  report.  As  to  one 
of  these  questions,  namely,  that  touching  the 
sale,  evidence  may  be  offered  by  the  defend- 
ant which  may  have  a  material  bearing;  but 
as  the  evidence  is  reported,  we  are  all  of 
opinion  that  the  plaintiffs  have  made  out  a 
prima  facie  case,  and  the  nonsuit  must  be 
set  aside  and  a  new  trial  granted. 


WHEN   TITLE  PASSES. 


iy3 


JEXXEK   V.   SMITH. 

(L.  R.  4  C.  P.  270.) 

Coimnon  Ploas.    April  30,  1S(J9. 

Aetiou  for  prnods  bargained  and  sold  and 
jjoods  sold  and  delivered.  Pleas:  Never  in- 
debted, payment,  and  payment  of  8s.  2d.  into 
court.  Replication,  taking  issue,  and  dam- 
ages ultra. 

The  cause  was  tried  before  Brett,  J.,  at 
the  sittings  at  Westminster  after  last  Micli- 
aelmas  term.  The  facts  were  as  follows: 
On  the  14th  of  October.  lSi;7.  the  plaintiff, 
who  is  a  hop-merchant  in  Loudon,  met  the 
defendant,  a  malster  of  Devizes,  at  Weyhill 
Fair,  Hants.  The  defendant  wished  to  buy 
of  the  plaintiff  four  pockets  of  Carpenter's 
Sussex  hops  which  the  plaintiff  had  there; 
but,  as  the  plaintiff  had  already  sold  two  of 
them,  he  proposed  to  sell  the  defendant  in 
lieu  of  them  two  pockets  of  Thorpe's,  of 
which  he  showed  him  a  sample,  offering  to 
let  the  defendant  have  the  two  pockets  of 
Carpenter's  at  £9  per  ewt.  (the  price  of  that 
day's  fair  being  £!>  9s.),  if  he  would  take 
two  pockets  of  Thorpe's  at  £7  15s.  per  cwt. 
The  plaintiff  at  the  same  time  or  shortly 
after  informed  the  defendant  that  the  last- 
mentioned  two  pockets  were  lying  at  Prid  -i; 
Son's  warehouse,  Kentish  Buildings.  South- 
wark,  and  agreed  that  he  should  have  them 
upon  the  same  terms  as  if  they  had  been  in 
bulk  at  the  fair,  that  is,  that  he  should  be 
at  no  expense  for  warehousing  or  carriage. 
The  defendant  consented  to  purchase  the 
four  pockets  upon  these  terms,  and  took 
away  Avith  him  the  two  pockets  of  Carpen- 
ter's, but  requested  that  the  two  pockets  of 
Thorpe's  should  not  be  sent  until  he  wrote 
for  them. 

The  plaintitf  had  at  this  time  three  pock- 
ets of  Thorpe's  hops  at  the  warehouse  of 
Prid  &  Sou.  On  the  21st  of  October,  the 
l)laintiff's  son  went  to  the  warehouse,  and 
instructed  the  warehouseman  to  .set  apart 
two  of  the  three  pockets  of  Thorpe's  for  the 
defendant;  and  the  warehouseman  thereup- 
on placed  on  two  of  them,  numbered  re- 
spectively one  and  three,  what  is  called  a 
"wait  order  card,"  that  is.  a  card  upon 
which  was  written,  "To  wait  orders."  and 
llie  name  of  the  vendue.  No  alteration,  how- 
ever, was  made  in  the  warehouse  books; 
and  the  plaintiff,  the  original  depositor,  still 
I'emained  liable  for  the  rent. 

On  the  4th  of  November,  the  plaintiff  sent 
the  defendant  an  invoice  as  follows,  at  the 
same  time  inclosing  a  draft  for  acceptance: — 

Mr.  S.  Sinitli.     BdusIt  of  Cliar'i's  Jtnuer: 
2  iiooketsi  Sussex  hops  (CurpeuttT,  1^G7), 
No.  2  ...    1  cwi.  2  qr.s.  2(>  lb.s. 
4   ...   1  cwt.  2  qrs.  i:{  iba. 

3  cwt.  1  qr.    a  lb.s.  (ffi  £9  per  cwt.  £30  2s.  8d. 
2  poc'veta  Sussex  hop-:  (Tlmrpe,  ISii"), 
No.  1  ...  1  cwt.  2  ijrs.  27  lb.s. 
3  ...  1  cwt.  0  qr.    21  lbs. 


2  cwt  3qrs.201b8  @£7158.p3rcwt.  £22  I3.s.  lOd. 

£5.'  Ills.  ea. 

The  two  last  po.  kete  ol  hop.s  fiie  lying  to  your  order. 


On  the  8th  of  November  the  defendant 
wrote  to  the  plaintiff  as  follows:— 

Sir, — I  have  returned  your  bill  unsigned; 
but,  as  I  have  never  receivf^d  the  two  pock- 
ets of  hops  or  heard  any  thing  about  them, 
I  concluded  you  had  not  thought  of  sending 
them,  and  have  made  an  excliange  for  some 
malt,  and  shall  not  retpiire  them.  As  I  will 
never  sign  a  l)ill.  I  will  pay,  as  was  agreed, 
in  February,  the  weight  of  the  two  Carpen- 
ter's. 

The  defendant  subsequently  paid  the  price 
of  the  two  pockets  which  he  had  received, 
all  but  a  small  balance  which  was  covered 
by  the  payment  into  court. 

It  was  objected  on  the  part  of  the  defend- 
ant that,  as  to  the  two  pockets  of  Thorpe's 
hops,  there  was  no  contract  binding  within 
the  statute  of  frauds,  no  delivery  or  ac- 
ceptance, or  part  payment,  and  no  evidence 
of  goods  bargained  and  sold. 

For  the  plaintiff  it  was  insisted  that  the 
whole  was  one  bargain,  and  couseiiuently 
that  there  had  been  a  part  delivery  and  part 
payment,  and  that  the  property  in  the  whole 
four  pockets  passed  by  the  contract. 

The  learned  judge  ruled  that  it  was  one 
entire  contract,  and  that,  therefore,  there  had 
been  a  part  delivery  so  as  to  make  a  con- 
tract binding  within  the  .statute  of  fr.iuds. 
that  the  plaintiff"  could  not  rely  upon  the 
part  payment,  because  the  defendant,  at 
the  time  of  making  the  payment,  repudiated 
the  bargain  as  to  the  two  pockets  in  ques- 
tion; that,  though  there  was  a  binding  con- 
tract, the  property  did  not  pass  thereby,  in- 
asmuch as  the  contract  was  to  deliver  two 
out  of  a  larger  number  of  pockets  of  Thorpe's 
hops  equal  to  sample,  the  price  to  be  deter- 
mined according  to  the  weight;  and  that 
there  had  been  no  sufficient  appropriation 
afterwards  to  pass  the  property,  because 
Prid  &  Son  never  bound  themselves  to  hoM 
for  the  defendant  instead  of  for  the  plain- 
tiff. He  thereupon  nonsuited  the  plaintiff, 
reserving  him  leave  to  move  to  enter  a  ver- 
dict for  £22  13s.  lOd.,  the  court  to  draw  in- 
ferences of  fact. 

Morgan  Lloyd,  in  Hilary  term  last.  ol)tain- 
ed  a  rule  nisi  accordingly.  H.  T.  Cole,  Q.  C. 
and  Bromley  showed  cause.  Morgan  Lloyd, 
in  support  of  the  rule. 

KKATIX<J.  .1.  I  am  of  opinion  that  this 
rule  should  be  discharged.  The  action  is 
brought  to  recover  the  price  of  two  pockets 
of  hops  as  sold  and  delivered  and  bargained 
and  sold.  It  appears  that  the  parties  met 
in  October,  18G7,  at  Weyhill  Fair,  and  that 
it  was  orally  agreeed  between  them  that  the 
defendant  should  purchase  of  the  plaintiff 
tAvo  pockets  of  Carpenter's  Sussex  hops, 
which  were  then  in  the  fair,  and  had  been 
insjiected  by  the  defendant,  at  £9  per  cwt.. 
and  also  two  pockets  of  Thorpe's  hops,  of 
Avhich  a  sample  was  shown,  at  £7  1.5s.  per 


134 


WHEN   TITLE  PASSES. 


cwt.  After  the  purchase  had  beeu  agreed  on, 
the  defendant  was  informed  that  the  latter 
were  lying  in  a  warehouse  in  London,  and 
he  requested  that  they  might  be  left  there 
until  he  sent  word  that  he  was  ready  to 
receive  them.  On  the  4th  of  November  the 
plaintiff  sent  an  invoice  describing  the  num- 
bers, weight,  and  price  of  the  four  pock- 
ets, with  an  intimation  that  the  two  pockets 
of  Thorpe's  were  lying  at  the  warehouse  to 
the  defendant's  orders.  The  plaintiff  had 
three  pockets  of  Thorpe's  hops  at  the  ware- 
house; and  he  had  in  the  mean  time  gone 
to  ihe  warehouse  and  directed  the  ware- 
house keeper  to  put  certain  marks  upon  two 
of  them,  to  indicate  that  they  were  sold  and 
were  to  wait  the  orders  of  the  purchaser. 
No  alteration,  however,  was  made  in  the 
books  of  the  warehouse-keeper;  nor  was  any 
intimation  of  this  appropriation  of  the  two 
pockets  given  to  the  defendant  until  the  4th 
of  November,  when  the  invoice  was  for- 
warded to  him.  The  defendant  declined  to 
accept  the  two  pockets.  At  the  trial  various 
objections  were  urged.  It  was  said,  amongst 
other  things,  that  there  was  no  contract  a.s 
to  the  two  pockets  of  Thorpe's  hops  to  bind 
the  defendant  within  §  17  of  the  statute  of 
frauds;  that  the  contracts  for  the  purchase 
of  the  two  pockets  of  Carpenter's  hops  and 
for  the  two  pockets  of  Thorpe's  were  dis- 
tinct contracts;  and  that,  consequently, there 
had  been  no  delivery  or  part-payment  to 
take  the  case  out  of  the  statute.  My  brother 
Brett  ruled  that  the  contract  was  entire, 
and  the  objection  founded  upon  the  statute 
of  frauds  was  thus  got  rid  of.  Then  came 
the  question  whether  the  count  for  goods 
sold  and  delivered  or  goods  bargained  and 
sold  could  be  maintained,  the  property  in  the 
goods  not  having  passed.  Llpon  this  my 
brother  Brett  nonsuited  the  plaintiff,  but 
gave  leave  to  move  to  enter  a  verdict  for 
the  plaintiff  for  the  price  of  the  two  pock- 
ets in  dispute,  reserving  power  to  the  courc 
to  draw  such  inferences  as  a  jury  might 
draw.  The  question  before  us,  therefore  is, 
whether,  upon  the  facts  proved,  we  can  see 
that  the  property  in  the  hops  passed  to  the 
defendant  so  as  to  make  him  liable  in  this 
action.  The  general  rule  of  law  was  not 
contested  on  the  part  of  the  plaintiff,  that, 
where  an  article  (not  specific)  is  sold,  but 
something  remains  to  be  done  by  the  vendor 
before  it  is  despatched  to  the  vendee,  no 
property  passes  by  the  contract  of  sale.  It 
was  contended  on  the  part  of  the  defendant 
that  much  remained  to  be  done  here  before 
the  property  coidd  pass,— that,  the  hops  hav- 
ing been  .sold  by  sample,  they  would  require 
to  be  inspected,  and  to  be  weighed,  in  or- 
der to  ascertain  the  price.  On  the  other 
hand  it  was  lu-ged  that,  though  that  may 
be  so  as  a  general  rule,  Aldridge  v.  Johnson 
(7  El.  &  Bl.  885;  26  L.  J.  [Q.  B.]  20G)  and 
other  cases  show  that,  if  it  appears  from 
the  contract  that  the  vendee  has  made  the 
vendor  his  agent  for  the  purpose  of  weigii- 


ing  and  doing  all  the  other  acts  necessary  to 
be  done  to  pass  the  property,  the  property 
in  the  goods  will  pass  so  soon  as  those  acts 
are  done.  It  is,  however,  observable  that  in 
Aldridge  v.  .Johnson  the  bulk  of  the  barley 
had  been  inspected  and  approved,  and  all 
that  remained  to  be  done  was  to  sever  and 
measure  the  portion  to  be  appropriated  to 
the  vendee;  and  that  the  vendor  had  tilled 
a  number  of  sacks  which  had  been  sent  by 
the  vendee,  thereby  measuring  it.  The  bar- 
ley which  was  to  be  appropriated  to  the  ful 
tilment  of  the  contract  was  therefore  sev- 
ered from  the  bidk  and  measured  with  the 
assent  of  both  parties.  There  could  be  no 
doubt  that  the  property  in  the  barley  so 
dealt  with  passed.  Mr.  Lloyd  sought  to 
bring  the  present  ease  within  that  by  say- 
ing that  a  similar  extensive  authority  was 
conferred  by  the  defendant  on  the  plaintiff 
in  this  case.  I  cannot  draw  any  such  infer- 
ence from  the  facts  proved  here:  on  the  con- 
trary. I  think  they  negative  it.  I  cannot 
suppose  that  the  defendant  meant  to  part 
with  the  right  of  objecting  to  the  correspond- 
ence of  the  hops  with  the  sample,  or  of  In- 
sisting on  the  weight  being  ascertained,  be- 
fore the  property  passed.  It  is  true,  there 
was  an  intimation  to  the  warehouse-keeper 
that  the  two  pockets  numbered  one  and  three 
had  been  sold  to  the  defendant;  but  no 
transfer  was  made  in  his  books,  and  he  still 
held  them  at  the  charge  and  at  the  risk  of 
the  vendor.  I  think  it  is  impossible  for  the 
court  to  draw  the  inference  that  an  authori- 
ty such  as  was  given  in  Aldridge  v.  John- 
son (7  El.  &  Bl.  885;  26  L.  J.  [Q.  B.]  296) 
was  given  here;  and  if  no  such  authority 
was  given,  the  case  is  brought  within  the 
multitude  of  authorities  in  which  it  has 
beeu  held  that,  where  there  is  a  sale  of  im- 
ascertained  goods  with  reference  to  which 
something  remains  to  be  done  by  the  ven- 
dor before  delivery  to  the  vendee,  no  proper- 
ty passes  until  that  has  beeu  done. 

BRETT.  J.  At  the  trial  I  proposed  to  non- 
suit the  plaintiff,  on  the  ground  that  there 
was  no  evidence  to  go  to  the  jury  in  support 
of  the  count  for  goods  bargained  and  sold, 
It  was  not  then  suggested  that  there  was 
any  authority  from  the  defendant  to  the 
plaintiff  to  select  the  two  pockets  for  him. 
If  it  had  been,  I  should  not  have  nonsuited 
the  plaintiff,  but  would  have  left  that  ques- 
tion to  the  jury.  The  question  now  is,  not 
whether  there  was  any  evidence  for  the  jury, 
btit  whether  the  court  can  infer  from  the 
facts  proved,  that  the  property  in  the  two 
pockets  of  Thorpe's  passed.  It  is  clear  that 
no  property  passed  by  the  contract  itself. 
The  contract  was  for  a  sale  by  sample  of 
unascertained  hops,  the  price  depending  on 
the  weight.  Then  comes  the  case  put  by 
my  brother  Blackburn  in  the  pas.sage  at  p. 
127,  to  which  I  referred  in  the  course  of  the 
argument.  Here  there  Avas  no  previous  au- 
thority given  to  the  plaintiff  to  appropriate; 


WHEN  TITLE  PASSES. 


135 


.-.nul,  if  not,  what  evidence  was  there  to  show 
that  the  appropriation  of  the  two  pockets  in 
Prid  tfc  Son's  warehouse  was  ever  assented 
to  by  the  defendant?  The  defendant's  as- 
j^ent  might  have  been  given  in  either  of  two 
ways,— by  himself,  or  by  an  autliorized 
agent.  By  himself,  after  the  receipt  of  the 
letter  containing  the  invoice;  or  by  the 
warehouse-keepers,  if  there  had  been  any 
evidence  of  agency  or  authority  in  them  to 
accept,  and  assent  by  them  to  hold  the  hops 
for  him.  I  think  the  defendant's  letter  re- 
fusing to  accept  the  draft  was  strong,  if  not 
■conclusive,  to  show  that  there  had  been 
no  such  assent  by  the  defendant.  And.  as 
to  Prid  &  Son,  the  evidence  fails  on  both 
points.  They  never  agreed  to  hold  the  two 
pockets  on  behalf  of  the  purchaser;  and,  if 
they  did,  there  is  no  evidence  of  any  authori- 
ty  from   him   that   they   might   do   so.      ;\lr. 


Lloyd  has  strongly  put  forward  a  point 
which  was  not  made  at  the  trial,  viz.,  that 
lliere  was  evidence  that,  by  agreement  be- 
tween the  parties,  the  purchaser  gave  au- 
tliority  to  the  seller  to  select  the  two  pock- 
ets for  him.  If  he  did  so,  he  gave  up  his 
power  to  object  to  the  weighing  and  to  the 
goods  not  corresponding  with  the  sample; 
for  he  could  not  give  such  authority  and  re- 
serve his  right  so  to  object;  and  indeed  it 
has  not  been  contended  that  he  gave  up 
those  rights.  That  seems  to  me  to  be  con- 
clusive to  show  that  the  defendant  never 
gave  the  plaintiff  authority  to  make  the  se- 
lection so  as  to  bind  liim.  Under  the  cir- 
cumstances, therefore,  it  is  impassi))le  to  say 
that  the  property  pas.sed;  couseijuently  the 
plaintiff  cannot  recover  as  for  goods  bar- 
gained and  sold. 
Rule  discharged. 


i;36 


WHEN   TITLE  PASSES. 


GILL  V.  DE  ARMANT  et  al. 

(51  N.  W.  527,  90  Mich.  425.) 

Supreme  Court  of  Michigan.    March  4,  1S92. 

Error  to  circuit  court,  Emmet  county;  Fred 
H.  Aldricli,  Judge. 

Action  in  replevin  by  Cliarles  N.  Gill  asaiust 
Andrew  J.  De  Armant  and  auotlier.  I'laiu- 
tiir  had  judgment,  and  defendants  assign  er- 
ror.    Attirmed. 

M.  W.  Geoi-ge,  for  appeUants.  B.  T.  Hal- 
stoad,  for  appellee. 

LONG,  .T.  This  is  an  action  of  replevin  for 
one  saw  frame  and  carriage  and  appurte- 
nances. The  action  was  commenced  in  jus- 
tice court  in  Emmet  county.  The  writ  was 
placed  in  the  hands  of  the  sheriff,  who  re- 
turned upon  the  writ  that  he  had  replevied 
the  propertj%  and  delivered  the  same  to  the 
plaintiff,  and  also  summoned  the  defendants 
to  appear  according  to  the  mandate  of  the 
writ.  The  parties  appeared  on  the  return-day 
and  joined  issue;  the  defendants  giving  notice, 
under  their  plea  of  the  general  issue,  that  the 
property'  described  was  at  the  time  the  suit 
was  brought  a  part  and  portion  of  certain  de- 
scribed real  estate.  Plaintiff  had  judgment  in 
justice  court,  finding  the  title  of  the  property 
in  him,  and  assessing  his  damages  for  deten- 
tion at  six  cents.  Defendants  appealed  to  the 
circuit  court,  where  the  cause  was  tried  before 
the  court  without  a  jury.  The  plaintiff,  to 
maintain  his  action,  was  called  as  a  witness, 
and  testified  that  he  was  the  owner  of  the 
property  at  the  time  of  bringing  the  writ;  that 
he  found  it  in  defendants'  possession,  and 
made  demand  for  it.  which  w'as  refused;  that 
the  propertj'  was  formerly  a  part  of  a  mill  at 
Clarion,  in  Charlevoix  county,  and  had  been 
removed  by  the  defendants,  and  put  up  in 
their  mill  at  Petoskey.  He  offered  in  evi- 
dence: (1)  An  agreement  in  writing,  made 
March  15,  ISSS,  between  himself  and  one  LiUe 
Messier,  by  the  terms  of  w^hich  he  agreed  to 
sell  to  her  an  undivided  one-balf  interest  in 
the  miU  at  Clarion,  then  owned  by  him,  for 
a  consideration  of  $200.  This  included  the 
property  in  controversy.  One  hundred  dollars 
was  to  be  paid  at  the  signing  of  the  agree- 
ment, and  the  balance,  INIarch  15,  1890. 
There  was  a  stipulation  in  this  agreement  that 
in  case  default  should  be  made  in  the  pay- 
ments the  agreement  should  be  null  and  void. 
There  was  paid  on  this  contract  $137.38, 
March  31,  1888,  and  $18..->0.  April  30,  18S8. 
No  further  payments  were  made.  (2)  A  con- 
tract made  between  himself  and  one  Elizabeth 
Hass,  .July  2,  1889,  by  the  terms  of  which 
he  sold  conditionally  to  her  an  undivided  one- 
half  interest  in  the  mill  for  the  sum  of  $565. 
This  also  included  the  property  in  controversy. 
By  the  terms  of  this  agreement  $52..50  was 
paid  at  its  date,  the  balance  to  be  paid  in 
monthly  installments  of  $25.  The  title  of  the 
l)i'oix;rty  was  to  remain  in  the  plaintiff"  until 
fully  paid  for.  October  29,  1889.  Mrs.  Hass 
paid  $25,  and  on  December  14,  1889,  she  paid 


$115.19.  These  were  all  the  payments  made 
on  that  contract.  The  parties  took  possession 
of  the  mill  under  these  contracts.  It  appears 
that  the  mill  and  property  described  in  these 
contracts  were  partially  destroyed  by  fire,  and 
that  the  defendants,  on  April  28,  1890,  pur- 
cliased  the  property  in  controversy  from 
James  R.  Hass,  the  husband  of  Elizabeth 
Hass,  and  who  acted  as  her  agent;  he  giving 
the  defendants  a  bill  of  sale,  the  consideration 
expressed  in  it  being  the  sum  of  $05,  which 
defendants  paid.  Mrs.  Hass  was  in  posses- 
sion of  the  mill  property  at  the  time  the  bill 
of  sale  was  given.  The  defendants  took  the 
saw  frame  and  caniage  and  appurtenances, 
placed  it  in  their  mill  at  Petoskey,  where  it 
was  bolted  to  the  floor,  and  used  by  them  in 
their  business.  Defendants'  counsel  objected 
to  the  introduction  of  these  contracts  in  evi- 
dence, claiming  that  they  did  not  tend  to 
show  title  in  the  plaintiff.  They  were  admit- 
ted. This  constitutes  defendants'  first  claim 
of  error. 

The  plaintiff's  counsel  contended  that  the 
agreement  with  Lille  M.  Messier  is  an  execu- 
toiy  conti'act  or  agreement  to  convey  upon 
condition  that  payments  were  made  as  pro- 
vided, and  that,  the  vendee  having  defaulted 
in  the  payments,  the  title  to  that  undivided 
one-half  interest  never  passed  to  her;  that,  by 
the  express  provisions  of  the  contract  with 
Elizabeth  Hass,  that  undivided  one-half  in- 
terest never  passed  to  her,  and  that,  therefore, 
the  title  to  that  part  of  the  pi'operty  in  con- 
troversy here  still  remained  in  him  at  the 
time  the  suit  was  brought.  The  court  below 
so  held,  and,  we  thinli  veiy  properly.  IMie 
contract  with  Mrs.  Messier  does  not  purport 
to  be  a  conveyance  of  the  title  of  the  mill 
property,  but  an  agreement  that,  upon  certain 
conditions  thereafter  to  be  performed  by  her, 
he  was  to  convey  the  title  to  her.  These  con- 
ditions were  not  performed,  and  therefore  the 
title  to  that  undivided  one-half  interest  had 
not  passed  out  of  the  plaintiff. 

In  the  contract  with  Mrs.  Hass  the  plain- 
tiff" expressly  reserved  the  title  in  himself  un- 
til full  payment  was  made.  These  payments 
have  not  been  made  in  full,  so  that  the  title 
to  all  of  the  mill  property  remained  in  the 
plaintiff  at  the  time  the  defendants  purchased 
from  Mrs.  Hass,  through  her  husband.  There 
was  a  considerable  amount  yet  due  to  the 
plaintiff  under  both  these  contracts  at  the  time 
the  suit  was  brought;  and  the  plaintiff  was 
permitted  to  testify  upon  the  trial,  under  de- 
fendants' objection,  to  the  value  of  the  prop- 
ertj-  left  at  the  mill,  covered  by  these  con- 
tracts, and  not  taken  by  the  defendants.  De- 
fendants' counsel  bases  his  second  claim  of  er- 
ror upon  the  admission  of  this  testimony. 
There  was  no  error  in  admitting  it.  It  ap- 
pears from  this  testimony,  and  the  plaintiff" 
had  the  right  to  show  the  fact,  that  the  value 
of  the  whole  proiiertj',  including  that  taken  by 
defendants,  was  no  greater  than  tlie  amounts 
remaining  unpaid  under  these  contz'aets. 

The   defendants'    third   claim   was    that   the 


WHEN   TITLE  PASSES. 


137 


proiiorty  tnkeu  by  them,  and  put  in  their  mill 
at  I'etos-kcy,  was  so  annexed  to  the  realty  that 
an  action  of  replevin  could  not  be  maintained, 
as  its  removal  from  the  mill  would  be  an  in- 
jury to  the  realty  to  wliich  it  was  attached. 
The  court  below  niled  that  the  property  had 
not  become  so  attached.  We  think  the  court 
was  correct.  It  was  property  beloni;ing  to  the 
plaintiff,  taken  by  tlie  defendants,  and  by 
them  put  in  use  in  their  mill.  It  was  proper- 
ty capable  of  beneticial  use,  if  set  up  in  anj- 
other  place.  No  agreement  is  shown  upon  the 
part  of  the  owner  that  the  defendants  might 
so  attach  it;  and  the  defendants,  under  the 
circumstances  liere  stated,  cannot  be  permitted 
to  malce  such  a  claim.  Personal  proiierty  may 
become  a  part  of  real  estate,  where  atlixed  to 
it,  if  such  was  the  understanding  between 
the  parties;  or  it  might  remain  personal  es- 
tate, if  the  understanding  to  that  effect  was 
clearly  indicated,  or  fairly  deducible  from  the 
circumstances.  Manwaring  v.  Jenison,  01 
Mich.  117,  27  N.  W.  890.  and  note;  Rogers  v. 
Brokaw.  2.")  X.  J.  Eq.  490;  Blancke  v.  Rogers, 
20  N.  .T.  Eq.  503;  Voorhees  v.  McGinuis,  -18 
N.  Y.  278.  Here  the  attempt  is  made  to  take 
the  property  of  another,  and  to  attach  it  to 
the  realty,  without  the  consent  of  the  owner. 


and  then  to  assert  that  it  is  a  part  of  tlie  real- 
ty. The  court  below  very  pi-operly  licld  tliat 
this  could  not  be  done. 

The  court  below,  upon  the  presentation  of 
the  whole  case,  entered  judgment  in  favor  of 
the  plaintiff.  Complaint  is  made  by  defend- 
ants' counsel  as  to  the  form  of  this  judgment. 
It  appeared  upon  the  trial  that  altliough  the 
otticer  stated  in  his  return  that  he  had  re- 
plevied the  proi)erty.  and  delivered  it  to  the 
plaintiff,  the  fact  was  that  at  the  time  of  the 
service  of  the  writ  the  officer  did  not  remove 
the  property  from  defendants'  mill,  or  disturb 
it  therein,  but,  by  an  arrangement  between 
the  parties  themselves,  it  was  agreed  that  the 
property  should  remain  there  pending  the  suit, 
luitil  its  value  was  determined.  A  bill  of  ex- 
ceptions was  settled  in  tlie  case,  but  the  cause 
was  tried  Ix^fore  the  court  without  a  jury,  and 
there  is  nothing  in  the  record  showing  that 
findings  of  fact  or  law  were  a.sked  or  made. 
The  attention  of  the  trial  court,  as  appears 
from  the  record,  was  not  called  to  the  form 
of  judgment  entered;  and  it  is  raised  in 
this  court,  for  the  first  time,  by  an  assign- 
ment of  error.  The  judgment  of  the  court  be- 
low must  therefore  be  affirmed,  with  costs. 

The  other  justices  c-oncm'red. 


138 


WHEN   TITLE  PASSES. 


HOVEY  et  al.  v.  GOW. 
(45  N.  W.  9S5,  81  Mich.  314.) 
Supreme  Court  of  Michigan.    June  0.  1890. 
Error  to  ciicuit  court,  Mnskeson  county. 

De   Lontf     &     O'Hara,     for     ai)ijellHn  t 
Smith,  Nim.s,  Hoyt  &  Erwin,for  appeile  cs 

CAHILL,  J.  Thi.s  was  an  action  of  replevin 
commenced  br  Hovey&  jMcCracken,  to  re- 
cover a  quantity  of  lumber,  wliicli  in  March, 
1S89,  liad  been  seized  by  the  defendant  as 
city  treasurer  of  Muskegon,  to  satisfy  a 
claim  for  taxes  assessed  aj^ainst  A.  P.  & 
W.  E.  Kelley  Company  of  Cliica^o,  on  cer- 
tain personal  property  of  theirs  situate  in 
Muskegon,  and  liable  to  assessment  there. 
The  amount  of  the  tax  was  something- 
over  .f;  1,000.  The  plaintiffs  claim  to  be 
owners  of  the  lumber  in  suit,  and  their 
claim  is  based  upon  the  following  contract 
made  between  them  and  A.  P.  &  W.  E. 
Kellev  Company:  "Muskegon,  Mich.,  Nov. 
20.  1888.  A.  P.  &  W.  E.  Kelley  Co.  have 
this  day  bought,  and  Hove.vand  McCrack- 
en  have  sold,  one  million  feet  selected 
Eaglehead  lumber,  now  in  cross-piles  on 
McCracken,  Hovey  &  Co.'s  docks,  in  Mus- 
kegf)n,  and  one  and  one-half  million  feet 
additional  to  be  cut  from  their  Eaglehead 
logs,  the  number  to  be  sorted  and  cross- 
piled  as  to  quality  same  as  above,  that 
being  sixty  per  cent,  of  the  better  lumber 
in  the  log.  liovey  and  McCracken  guar- 
anty to  sort  lumber,  as  follow's;  Forty 
per  cent,  of  the  coarsest  by  itself,  and  they 
are  to  retain  it.  The  remaining  sixty  per 
cent,  by  it.self  for  A.  P.  &  W.  E.  Kelley  Co. 
At  the  close  of  the  present  sawing  season, 
C.  S.  Montague  is  to  estimate  lumber  on 
dock,  and  determine  as  to  the  jjercentage 
as  to  sorting  as  above  required.  If  sorted 
within  two  per  cent,  of  above  require- 
ments, either  way,  then  this  contract  is  to 
be  in  force;  if  more  than  two  per  cent.,  it 
is  at  the  oi)tion  of  tiie  A.  P.  &  AV.  E.  Kelley 
Co.  whether  they  take  it  or  not;  but  they 
are  to  decitle  and  notify  the  sellers  within 
five  (.j)  daysaftersaid  estimation  is  made. 
The  lumberis  to  be  sawed  and  ti-immed  in 
a  good  and  workman-like  manner,  and 
cross  piled  on  McCracken,  Hovey  &  Co. 
docks,  and  held  until  the  spring  of  18S9  at 
the  sellers'  risk  ;  all  the  lumber  to  be  cross- 
piled  loose,  and  the  piles  to  have  good  pitch  ; 
all  the  i)iles  to  be  covered  and  tied  down, 
to  shed  snow  and  rain.  The  seller  agrees 
to  commence  sawing  at  once  on  the  one 
and  one-half  million  feet  yet  to  be  sawed, 
and  continue  on  same  till  the  close  of  the 
present  sawing  season.  In  case  the  whole 
amount  is  not  cut  at  that  time,  they  will 
commence  at  the  opening  of  navigation, in 
the  spring  of  ls89,  and  complete  the  saw- 
ing of  the  same.  The  purchasers  buy  the 
above-mentioned  lumber  on  the  following 
terms:  The  lumber  is  to  be  settled  for  by 
the  sellers' draft  on  the  purchasers  at  such 
time,  but  not  later  than  December  1st, 
1888,  as  the  purchasers  may  elect,  not  ex- 
ceeding six  months'  time  from  December 
1st,  1888;  but  the  price  must  be  eighteen 
and  fifty  one-hundredths  dollars  ($18.50) 
net  per  thousand  feet,  and  half  tally  to  the 
seller,  December  1st,  ISSS.  Final  settle- 
ment to  be  made  when  lumber  is  shipped, 
in  spring  of  1889.  Itisdistinctly  agreed  that 


this  lumber  belongs  to  the  sellers  until 
shi]»i)ed,  in  spring  of  1889.  and  when  so 
shipped  it  is  to  be  free  of  any  insurance 
charges  or  taxes  that  may  be  assessed 
against  said  lumber.  All  mill-culls  to  be 
taken  out  when  shipped,  and  lumber  to  be 
tallied  by  C.  S.  Montague.  It  is  further 
mutually  agreed  between  the  sellers  and 
purchasers  that,  in  the  event  of  the  loss  of 
any  portion  of  this  lumber  by  fire,  the  pur- 
chasers may  elect  whether  tlie  trade  is  to 
be  considered  off  for  that  portion  of  the 
lumber  so  destroyed,  and  the  money  re- 
fun<led  that  may  be  due  them,  with  inter- 
est at  seven  per  cent,  from  the  time  the 
money  was  actually  paid,  or  the  purchas- 
ers may  have  the  right,  if  there  are  anj' 
logs  of  the  same  mark  on  hand,  to  have 
this  lumber  so  destroyed  duplicated  by 
sawing  the  same  amount  and  qualit3-,  in 
manner  as  before.  In  casethere  should  be 
any  lumber  l)urjied,  and  no  logs  on  hand 
to  replace  the  lumber,  the  sellers  are  to  re- 
fund to  the  purchasers  to  the  amount  of 
$18.50  per  thousand  feet,  and  interest  at 
seven  per  cent,  for  the  amount  so  de- 
stro.yed.  A.  P.  &  W.  E.  Kklm<:y  Co.  [l. 
s.]     A.  P.   Kelley,  Pres.     Hovey  &  Mc- 

CfiACKEX.       [L.  S.]  " 

The  lumber  replevied  was  a  part  of  the 
same  lumber  covered  by  this  contract,  and 
was  worth  .$3,700.  Mr.  Hovey,  one  of  the 
plaintiffs,  testified,  on  cross-examination, 
that  at  the  time  this  contract  was  made 
there  was  about  1,000,000  feet  of  the  lum- 
ber sawed,  and  that  they  afterwards 
sawed  five  or  six  hundred  thousand  more; 
that  it  was  not  contemplated  that  any  of 
this  lumber  was  to  be  shipped  until  the 
spring  of  1889 ;  that  the  lumber  amounted 
to  $4(j,250,  according  to  the  tally  when 
shipped  ;  that  ,$45,000  had  been  paid  upon 
it  before  the  defendant  seized  it;  that  at 
the  time  of  the  seizure  all  the  lumber  that 
had  been  sawed  at  that  time  was  piled  out 
for  the  Kelley  Company ;  that  the  mark 
they  had  on  it  was  "  Eaglehead  No.  1;" 
that  he  could  not  say  whether  it  had  "K" 
marked  on  it  or  not;  the  defendant  seized 
eight  piles  of  lumber,  containing  about  200,- 
000  feet,  out  of  fifteen  or  sixteen  hundred 
thousand  piled  on  the  same  dock  ;  that  all 
this  lumber,  including  the  200,000  feet  re- 
plevied, was  finally  shipped  to  the  Kelley 
Company,  who  paid  the  plaintiffs  the  bal- 
ance due  on  it.  The  regularity  of  the  de- 
fendant's tax-roll  and  warrant,  and  the 
fact  that  it  showed  a  personal  tax  against 
A.  P.  &  W.  E.  Kelley  Company  for  $1,- 
089.40,  was  conceded.  The  court  directed 
a  verdict  for  the  plaintiffs,  and  the  defend- 
ant brings  error. 

The  single  question  involved  is  as  to 
whether,  under  the  contract  between  the 
parties,  the  title  to  this  lumber  had  passed 
from  the  plaintiffs  to  A.  P.  &  W.  E.  Kelley 
Company.  By  the  contract  it  is  distinctly 
agreed  that  the  lumber  should  belong  to 
the  sellei's  until  shipped,  in  the  spring  of 
1889,  and  when  so  shipped  to  be  free  of  any 
insurance  charges  or  taxes  that  may  be 
assessed  against  said  lumber.  Upon  this 
record  we  are  not  concerned  with  any  rea- 
sons or  motives  that  may  have  influenced 
the  parties  in  putting  this  jiro vision  into 
their  contract.  Whether  it  was  to  require 
the  plaintiffs  to  pay  the  taxes  that  might 
be  levied   ui)on   it  does  not   appear.     Nor 


WHEN   TITLE  PASSES. 


139 


Avas  it  claimed  that  thoro  was  an^'  unlaw- 
ful or  fraudulent  purpose  in  putting  such 
provision  in  the  contract.  It  is  not  for 
the  courts  to inakecontracts  between  par- 
ties; they  can  only  construe  and  enforce 
those  that  have  been  made.  We  see  noth- 
ing ambiguous  or  doubtful  about  the 
meaning  of  this  contract.  We  think  it 
clearly  and  explicith'  provided  that  the 
plaintiffs  should  be  owners  of  the  lumber 
until  it  was  whipped.  By  another  provis- 
ion of  the  contract,  the  lumber  was  to  be 
talliedbyC.  !S.  Montague,  and  a  final  settle- 
ment was  not  to  be  made  until  the  lumber 
was  all  shipped.    If  it  fell  short  of  the  esti- 


mated quantity,  there  would  be  thatnmch 
less  money  going  to  the  plaintiffs.  If  they 
suffei-ed  the  200.000  feet  seized  l)y  the  defend- 
ant to  be  taken  away  and  applied  to- 
wards the  payment  of  the  A.  P.  cVc  W.  E. 
Kelley  t'ompany  debt,  they  would  not 
have  been  entitled  to  claim  from  A.  P.  «fc 
\V.  E.  Kelley  Company  the  value  of  that 
luml)er  at  the  contract  price  as  though 
shipped.  It  was  of  importance,  thei-efore, 
to  the  plaintiffs  to  reclaim  this  lumber  so 
as  to  be  able  to  ship  it,  as  otherwise  thej' 
must  have  lost  the  price  of  it.  The  judg- 
ment is  affirmed,  with  costs.  The  other 
justices  concurred. 


140 


WHEN  TITLE  PASSES. 


MAEVIX    SAFE   CO.    v.   NORTON. 

(7  Atl.   418.  48  N.  J.  Law.  410.) 

Supremo  Com-t  of  New  .Ter.sey.    Nov.  29.  188G. 

On  certiorari  to  Mercer  common  pleas. 

On  :May  1,  1884.  one  Samuel  N.  Schwartz, 
of  Hi,iihtstown.  Mercer  county.  New  Jersey, 
went  to  Pliiladelpliia,  Pennsylvania,  and 
there,  in  the  office  of  the  prosecutors,  exe- 
cuted the  following  instrument:  "May  1, 
1884.  Marvin  Safe  Company:  Please  send, 
as  per  mark  given  below,  one  second-hand 
safe,  for  which  the  undersigned  agrees  to 
pay  the  sum  of  eighty-four  dollars  ($84,) 
seven  dollars  cash,  and  balance  seven  dol- 
lars per  month.  Terms  cash,  delivered  on 
board  at  Philadelphia  or  New  York,  unless 
otherwise  stated  in  writing.  It  is  agreed 
that  IMarvin  Safe  Company  shall  not  relin- 
quish its  title  to  said  safe,  but  shall  remain 
the  sole  owners  thereof  until  above  sum  is 
fully  paid  in  money.  In  event  of  failure 
to  pay  any  of  said  installments  or  notes, 
when  same  shall  become  due,  then  all  of 
said  installments  or  notes  remaining  unpaid 
shall  immediately  become  due.  The  Marvin 
Safe  Company  may,  at  their  option,  remove 
said  safe  without  legal  process.  It  is  ex- 
pressly understood  that  there  are  no  con- 
ditions whatever  not  stated  in  this  memo- 
randum, and  the  undersigned  agrees  to  ac- 
cept and  pay  for  safe  in  accordance  there- 
with. Samuel  N.  Schwartz.  Mark:  Sam- 
uel N.  Schwartz,  Hightstowu,  New  Jersey. 
Route,  New  Jersey.  Not  accountable  for 
damages  after  shipment."  Schwartz  paid 
the  first  installment  of  seven  dollars,  May 
1,  1884,  and  the  safe  was  shipped  to  him 
the  same  day.  He  afterwards  paid  two  in- 
stallments of  seven  dollars  each,  by  remit- 
tance to  Philadelphia  by  check.  Nothing 
more  was  paid.  On  July  30.  1884,  Schwartz 
sold  and  delivered  the  safe  to  Norton  for 
$55.  Norton  paid  him  the  purchase  mouej\ 
He  bought  and  paid  for  the  safe  without 
notice  of  Schwartz's  agreement  with  the 
prosecutors.  Norton  took  possession  of  the 
safe,  and  removed  it  to  his  office.  Schwartz 
is  insolvent,  and  has  absconded.  The  pros- 
ecutor brought  trover  against  Norton,  and 
in  the  court  below  the  defendant  recovered 
judgment  on  the  ground  that,  the  defendant 
having  bought  and  paid  for  the  safe  bona 
fide,  the  title  to  the  safe,  by  the  law  of  Penn- 
sylvania, was  transferred  to  him. 

Before  Justices  DEPUE,  DIXON,  and 
REED. 

A.  S.  Appelget.  for  plaintiff  in  certiorari. 
S.  M.  Schanck,  contra. 

DEPUE,  J.  The  contract  expressed  in  the 
written  order  of  May  1.  1884,  signed  by 
Schwartz,  is  for  the  sale  of  the  property  to 
him  conditionally;  the  vendor  reserving  the 
title,  notwithstanding  delivery,  until  the  con- 
tract price  should  be  paid.  The  courts  of 
Pennsylvania    make   a    distinction   between 


the  bailment  of  a  chattel,  with  power  in  the 
bailee  to  become  the  owner  on  payment  of 
the  price  agreed  upon,  and  the  sale  of  a 
chattel,  Avith  a  stipulation  that  the  title 
shall  not  pass  to  the  purchaser  until  the 
contract  price  shall  be  paid.  On  this  dis- 
tinction the  courts  of  that  state  hold  that 
a  bailment  of  chattels,  with  an  option  in 
the  bailee  to  become  the  owner  on  payment 
of  the  price  agreed  upon,  is  valid,  and  that 
the  right  of  the  bailor  to  resume  posses- 
sion on  non-payment  of  the  contract  price 
is  secure  against  creditors  of  the  bailee 
and  bona  fide  purchasers  from  him;  but 
that,  upon  the  delivery  of  personal  prop- 
erty to  a  purchaser  under  a  contract  of  sale, 
the  reservation  of  title  in  the  vendor  until 
the  contract  price  is  paid  is  void  as  against 
creditors  of  the  purchaser,  or  a  bona  fide 
purchaser  from  him.  Clow  v.  Woods.  5 
Serg.  &;  R.  275;  Enlow  v.  Klein,  79  Pa.  St. 
488;  Haak  v.  Linderman,  64  Pa.  St.  499; 
Stadtfeld  v.  Huntsman,  92  Pa.  St.  53; 
P>runswick.  etc..  Co.  v.  Hoover,  95  Pa.  St. 
508;  1  Benj.  Sales  (Corbin's  Ed.)  §  44G;  21 
Am.  Law  Reg.  (N.  S.)  224,  note  to  Le^vis  v. 
McCabe.  In  the  most  recent  case  in  the 
supreme  court  of  Pennsylvania,  Mr.  Jus- 
tice Sterrett  said:  "A  present  sale  and  de- 
livery of  personal  property  to  the  vendee, 
coupled  with  an  agreement  that  the  title 
shall  not  vest  in  the  latter  unless  he  pays 
the  price  agreed  upon  at  the  time  appointed 
therefor,  and  that,  in  default  of  such  pay- 
ment, the  vendor  may  recover  possession  of 
the  property,  is  quite  different  in  its  effect 
from  a  bailment  for  use,  or,  as  it  is  some- 
times called,  a  lease  of  the  property,  coupled 
with  an  agreement  whereby  the  lessee  may 
subsequently  become  .  owner  of  the  prop- 
erty upon  payment  of  a  price  agreed  upon. 
As  between  the  parties  to  such  contracts,, 
both  are  valid  and  binding;  but,  as  to 
creditors,  the  latter  is  good,  while  the  for- 
mer is  invalid."  Forrest  v.  Nelson,  19  Re- 
porter, 38,  108  Pa.  St.  481.  The  cases  cited 
show  that  the  Pennsylvania  courts  hold  the 
same  doctrine  with  respect  to  bona  fide  pur- 
chasers as  to  creditors. 

In  this  state,  and  in  nearly  all  of  our  sis- 
ter states,  conditional  sales — that  is,  sales  of 
personal  property  on  credit,  with  delivery  of 
possession  to  the  purchaser,  and  a  stipula- 
tion that  the  title  shall  remain  in  the  ven- 
dor until  the  contract  price  is  paid— have 
been  held  valid,  not  only  against  the  imme- 
diate purchaser,  but  also  against  his  cred- 
itors and  bona  fide  purchasers  from  him, 
unless  the  vendor  has  conferred  upon  his 
vendee  indicia  of  title  beyond  mere  posses- 
sion, or  has  forfeited  his  right  in  the  prop- 
erty by  conduct  which  the  law  rega'ds  as 
fraudulent.  The  cases  are  cited  in  Cole  v. 
Berry.  42  N.  J.  Law,  308;  Midland  R.  Co. 
V.  Hitchcock.  37  N.  J.  Eq.  550,  559;  1  Benj. 
Sales  (Corbin's  Ed.)  §§  437-460;  1  Smith, 
L.  C.  (8th  Ed.)  33-90;  21  Am.  Law  Reg.  (N. 
S.)  224,   note  to  Lewis  v.  McCabe;    15  Am. 


WHEN  TITLE  PASSES. 


141 


Law  Tvov.  3S0,  "Convorsioii  by  Purchase." 
The  (loctnne  of  the  courts  of  Peuusylvauia 
is  fouuded  upon  the  doctrine  of  Twyne's 
Case,  3  Coke,  SO,  and  Edwards  v.  Harbon, 
2  Term  R.  587,  that  the  possession  of  chat- 
tels under  a  contract  of  sale  without  title 
Ms  an  indelible  badge  of  fraud, — a  doctrine 
repudiated  quite  generally  by  the  comls  of 
this  country,  and  especially  in  this  state. 
Runyon  v.  Groshon,  12  N.  J.  Eq.  SG;  Broad- 
way Bank  v.  McElrath,  13  N.  J.  Eii.  24;  Mill- 
er V.  Pancoast,  29  N.  J.  Law,  2."iG.  The  doc- 
trine of  the  I'ennsylvauia  courts  is  disapprov- 
ed bj'  the  American  editors  of  Smith's  Lead- 
ing Cases  in  the  note  to  Twyne's  Case,  1 
Smith,  Lead.  Cas.  (8th  Ed.)  33,  34;  and  by 
Mr.  Landreth  in  his  note  to  Lewis  v.  McCabe, 
21  Am.  Law  Reg.  (N.  S.)  224;  but,  neverthe- 
less, the  supreme  court  of  that  state,  in  the 
latest  case  on  the  subject, — Forrest  v.  Nelson, 
decided  February  10,  1885, — has  adhered  to 
the  doctrine.  It  must  therefore  be  regarded 
as  the  law  of  Pennsylvania  that,  upon  a  sale 
of  personal  property  with  delivery  of  posses- 
sion to  the  purchaser,  an  agreement  that  title 
should  not  pass  until  the  contract  price 
should  be  paid  is  valid  as  between  the  origi- 
nal parties,  but  that  creditors  of  the  pur- 
chaser, or  a  purchaser  from  him  bona  fide 
by  a  levy  under  execution  or  a  bona  fide 
purchase,  will  acquire  a  better  title  than  the 
original  purchaser  had,— a  title  superior  to 
that  reserved  by  his  vendor.  So  far  as  the 
law  of  Pennsylvania  is  applicable  to  the 
transaction,  it  must  determine  the  rights  of 
these  parties. 

The  contract  of  sale  between  the  ]\larvin 
Safe  Company  and  Schwartz  was  made  at 
the  company's  office  in  Philadelphia.  The 
contract  contemplated  performance  by  the 
delivery  of  the  safe  in  Philadelphia  to  the 
carrier  for  transportation  to  Hightstown. 
When  the  terms  of  sale  are  agreed  upon, 
and  the  vendor  has  done  everything  that  he 
has  to  do  with  the  goods,  the  contract  of 
sale  becomes  absolute.  Leonard  v.  Davis,  1 
Black,  470;  1  Benj.  Sales,  §  308.  Delivery 
of  the  safe  to  the  carrier  in  pursuance  of 
the  contract  was  delivery  to  Schwartz,  and 
was  the  execution  of  the  contract  of  sale. 
His  title,  such  as  it  was,  under  the  terms  of 
the  contract,  was  thereupon  complete. 

The  validity,  construction,  and  legal  effect 
of  a  contract  may  depend,  either  upon  the 
law  of  the  place  where  it  is  made,  or  of  the 
place  where  it  is  to  be  performed,  or,  if  it 
relate  to  movable  property,  upon  the  law  of 
the  situs  of  the  property,  according  to  cir- 
cumstances; but,  when  the  place  where  the 
contract  is  made  is  also  the  place  of  per- 
formance and  of  the  situs  of  the  property, 
the  law  of  that  place  enters  into  and  be- 
comes part  of  the  contract,  and  determines 
the  rights  of  the  parties  to  it.  Frazier  v. 
Fredericks,  24  N.  J.  Law,  162;  Dacosta  v. 
Davis,  Id.  319;  Bulkley  v.  Hanold,  19  How. 
390;  Scudder  v.  Union  Nat.  Bank,  91  U.  S. 
400;    Prlti'hard   v.   Norton,   100    U.   S.   124,    1 


Sup.  Ct.  102;  [Morgan  v.  New  Orleans,  M. 
&  T.  R.  Co.,  2  Woods,  244,  Fed.  Cas.  No. 
9,804;  Simpson  v.  Fogo,  9  Jur.  (N.  S.)  403;  * 
Whart.  Confl.  Laws,  §S  341,  345,  401,  403,  418; 
Parr  v.  Brady,  37  N.  .7.  Law,  201.  The  con- 
tiact  between  Schwartz  and  the  conqiany 
having  been  made  and  also  executed  in  I'enn- 
sylvauia by  the  delivery  of  the  safe  to  him, 
as  between  him  and  the  company  Schwaitz's 
title  will  be  determined  by  the  law  of  Penn- 
sylvania. By  the  law  of  that  state  the  con- 
dition expressed  in  the  contract  of  sale,  that 
the  safe  company  should  not  relinquish  title 
until  the  contract  price  was  paid,  and  that  on 
the  failure  to  pay  any  of  the  installments 
of  the  price  the  company  might  resume  pos- 
session of  the  property,  was  valid,  as  be- 
tween Schwartz  and  the  company.  By  his 
contract,  Schwartz  obtained  possession  of 
the  safe,  and  a  right  to  acquire  title  on  pay- 
ment of  the  contract  price;  but  until  that 
condition  was  performed  the  title  was  in 
the  company.  In  this  situation  of  affa'rs, 
the  safe  was  brought  into  this  state,  and  the 
property  became  subject  to  our  law.s. 

The  contraijt  of  Norton,  the  defendant, 
Avith  Schwartz  for  the  purchase  of  the  safe, 
was  made  at  Hightstown,  in  this  state.  The 
property  was  then  in  this  state,  and  the  con- 
tract of  purchase  was  executed  by  delivery 
of  possession  in  this  state.  The  contract 
of  purchase,  the  domicile  of  the  parties  to 
it,  and  the  situs  of  the  subject-matter  of  pur- 
chase were  all  within  this  state.  In  every 
respect  the  transaction  between  Norton  and 
Schwartz  was  a  New  Jersey  transaction. 
Under  these  circumstances,  by  principles  of 
law  which  are  indisputable,  the  construction 
and  legal  effect  of  the  contract  of  purchase, 
and  the  rights  of  the  purchaser  under  it, 
are  determined  by  the  law  of  this  state.  By 
the  law  of  this  state,  Norton,  by  his  pur- 
chase, acquired  only  the  title  of  his  vendor, — 
only  such  title  as  the  vendor  had  when  the 
property  was  brought  into  this  state  and 
became  subject  to  our  laws. 

It  is  insisted  that  inasmuch  as  Norton's 
purchase,  if  made  in  Pennsylvania,  would 
have  given  him  a  title  superior  to  that  of 
the  safe  company,  that,  therefore,  his  pur- 
chase here  should  have  that  effect,  on  the 
theory  that  the  law  of  Pennsylvania,  which 
subjected  the  title  of  the  safe  company  to 
the  rights  of  a  bona  fide  purchaser  from 
Schwartz,  was  part  of  the  contract  between 
the  company  and  Schwartz.  There  is  no 
provision  in  the  contract  between  the  safe 
company  and  Schwartz  that  he  should  have 
power,  under  any  circumstances,  to  sell  and 
make  title  to  a  purchaser.  Schwartz's  dispo- 
sition of  the  property  was  not  in  conformity 
with  his  contract,  but  in  violation  of  it.  His 
contract,  as  construed  by  the  laws  of  Penn- 
sylvania, gave  him  no  title  which  he  could 
lawfully  convey.  To  maintain  title  against 
the  safe  company,  Norton  must  build  up  in 
himself  a  better  title  than  Schwartz  had. 
He  can  accomplish  that  result  only  by  virtue 


142 


WHEN   TITLE  PASSES. 


of  the  law  of  the  jurisdiction  in  which  he 
acquired  his  rig:hts. 
♦  The  doctrine  of  the  Pennsylvania  courts, 
that  a  reservation  of  title  in  tlie  vendor  upon 
a  conditional  sale  is  void  as  against  creditors 
and  bona  flde  purchasers,  is  not  a  rule  affix- 
ing a  certain  construction  and  legal  efCect  to 
a  contract  made  in  that  state.  The  legal  ef- 
fect of  such  a  contract  is  conceded  to  be  to 
leave  property  in  the  vendor.  The  law  acts 
upon  the  fact  of  possession  by  the  purcliaser 
under  such  an  arrangement,  and  makes  it 
an  indelible  badge  of  fraud,  and  a  forfeitui-e 
of  the  vendor's  reserved  title  as  in  favor  of 
creditors  and  bona  flde  purchasers.  The  doc- 
trine is  founded  upon  consideration  of  public 
policy  adopted  in  that  state,  and  applies  to 
the  fact  of  possession  and  acts  of  ownersliip 
under  such  a  contract,  without  regard  to  the 
place  where  the  contract  was  made,  or  its 
legal  effect  considered  as  a  contract. 

In  MacCabe  v.  Blymyre,  9  Phila.  61.5,  the 
controversy  was  with  respect  to  the  rights 
of  a  mortgagee  under  a  chattel  mortgage. 
The  mortgage  had  been  made  and  recorded 
in  Maryland,  where  the  chattel  was  when 
the  mortgage  was  given,  and  by  the  law  of 
JNIaryland  was  valid,  though  the  mortgagor 
retained  possession.  The  chattel  was  after- 
wards brought  into  Pennsylvania,  and  the 
Pennsylvania  court  held  that  the  mortgage, 
though  valid  in  the  state  where  it  was  made, 
would  not  be  enforced  by  the  courts  of  Penn- 
sj-lvania  as  against  a  creditor  or  purchaser 
who  had  acquired  rights  in  the  property  after 
it  had  been  brought  to  that  state;  that  the 
mortgagee,  by  allowing  the  mortgagor  to  re- 
tain possession  of  the  property,  and  bring  it 
into  Pennsylvania,  and  exeicise  notorious 
acts  of  ownership,  lost  his  right,  under  the 
mortgage,  as  against  an  intervening  Pennsyl- 
vania creditor  or  purchasei-,  on  the  ground 
that  the  contract  Avas  in  contravention  of 
the  law  and  policy  of  that  state.  Under 
substantially  the  same  state  of  facts  this 
court  sustained  the  title  of  a  mortgagee  un- 
der a  mortgage  made  in  another  state,  as 
against  a  bona  flde  purchaser  who  had 
bought  the  property  of  the  mortgagor  in  this 
state,  for  the  reason  that  the  possession  of 
the  chattel  by  the  mortgagor  Avas  not  in  con- 
travention of  the  public  policy  of  this  state. 
Parr  v.  Biady,  37  N.  J.  Law,  201. 

The  piiblic  policy  which  has  given  rise  to 
the  doctrine  of  the  Pennsylvania  courts  is 
local,  and  the  law  which  gives  effect  to  it  is 
also  local,  and  has  no  extraterritorial  effect. 


In  the  case  in  hand,  the  safe  was  removed 
to  this  state  by  Schwartz  as  soon  as  he  be- 
came the  purchaser.  His  possession,  under 
the  contract,  has  been  exclusively  in  this 
state.  That  possession  violated  no  public  pol- 
icy,— not  the  public  policy  of  Pennsylvania, 
for  the  possession  was  not  in  that  state;  nor 
the  public  policy  of  this  state,  for  in  this 
state  possession  under  a  conditional  sale  is 
regarded  as  lawful,  and  does  not  invalidate 
the  vendor's  title  unless  impeached  for  actual 
fraud.  If  the  right  of  a  purchaser,  under  a 
purchase  in  this  state,  to  avoid  the  reserved 
title  in  the  original  vendor  on  such  grounds- 
be  conceded,  the  same  right  must  be  extend- 
ed to  creditors  buying  under  a  judgment  and 
execution  in  this  state;  for  by  the  law  of 
Pennsylvania  creditors  and  bona  flde  pur- 
chasers are  put  upon  the  same  footing.  Nei- 
ther on  pi'inciple,  nor  on  considerations  of 
convenience  or  public  policy,  can  such  a 
riglit  be  conceded.  Under  such  a  condition 
of  the  law,  confusion  and  uncertainty  in  the 
title  to  property  would  be  introduced,  and 
the  transmission  of  the  title  to  movable  prop- 
erty, the  situs  of  which  is  in  this  state,  would 
depend,  not  upon  our  laws,  but  upon  the 
laws  and  public  policy  of  sister  states  or 
foreign  countries.  A  purchaser  of  chattels 
in  this  state  Avhicli  his  vendor  had  obtained 
in  New  York,  or  in  most  of  our  sister  states^ 
under  a  contract  of  conditional  sale,  w'ould 
take  no  title;  if  obtained  imder  a  conditional 
sale  in  Pennsylvania,  his  title  would  be  good; 
and  the  same  uncertainty  would  exist  in  the 
title  of  purchasers  of  property  so  circum- 
stanced at  a  sale  under  judgment  and  execu- 
tion. 

The  title  was  in  the  safe  company  when 
the  property  in  dispute  was  removed  from 
the  state  of  Pennsylvania.  Whatever  might 
impair  that  title — the  continued  possession 
and  exercise  of  acts  of  OAvnership  oA'er  it  by 
ScliAA'artz,  and  the  purchase  by  Norton— oc- 
curred in  this  state.  The  Ifegal  effect  and 
consequences  of  those  acts  must  be  adjudged 
by  the  laAV  of  this  state.  By  the  laAV  of  this 
state  it  Avas  not  illegal  nor  contrary  to  piiblie 
policy  for  the  company  to  leave  Schwartz  in 
possession  as  ostensible  owner,  and  no  for- 
feiture of  the  company's  title  could  result 
therefrom.  By  the  laAV  of  this  state,  Norton, 
by  his  purchase,  acquired  only  such  title  as 
Schwartz  had  under  his  contract  with  the 
company.  Nothing  has  occurred  which  by 
our  laAV  AA'ill  giA-e  him  a  better  title. 

The  judgment  should  be  reversed. 


WHEN   TITLE   PASSES. 


143 


LASSIXG   y.   JAMES.      (No.   1.5,(337.) 

(40  Pac.  534,  107  Cal.  348.) 

Supreme  Court  of  Califoruia.      May  28,  1895. 

In  bank.  Appeal  from  superior  court,  city 
and  county  of  San  Francisco;  A.  A.  Sander- 
son, .Tudjre. 

Action  by  J.  F.  Lassing  against  J.  G.  James    ' 
on    a    conti-act   to   pasture   and    feed    cattle. 
From  a  judgment  for  plaintiff  and  an  order    ; 
denying  a  motion  for  a  new  trial,  defendant    i 
appeals.    Affirmed.  I 

W.    C.    Graves,    for   appellant.     Edward  P.    I 
Cole  and  T.  C.  Law,  for  respondent. 

GAIIOUTTE,  J.  The  plaintiff,  Lassing,  was  j 
a  farmer,  and  the  o\\ner  of  several  fields  of  | 
growing  alfalfa.  He  was  also  the  owner  of 
nine  stacks  of  hay,  amounting  to  about  2,700 
tons,  which  hay  was  situated  in  these  various 
fields.  Defendant.  James,  was  the  owner  of 
a  large  number  of  cattle,  and  was  desirous 
of  securing  both  pastiuage  and  hay  upon 
which  to  feed  them.  Thereupon  a  written 
agreement  was  entered  into  between  these 
two  parties,  which,  among  other  things,  con- 
tained the  following  covenants:  "That  the 
said  party  of  the  first  part  (Lassing),  in 
consideration  of  the  covenants,  promises,  and 
agi'eements  on  the  part  of  the  said  party  of 
the  second  part  (James),  hereinafter  contain- 
ed, hereby  covenants,  promises,  and  agrees  to 
and  with  the  said  party  of  the  second  part 
that  the  said  party  of  the  tirst  part  will  take 
onto  his  inclosed  alfalfa  fields  cattle  aggregat- 
ing about  800  to  1.200  head,  to  be  pastured 
at  90  cents  per  head  per  month.  If  any  cat- 
tle should  remain  on  said  pasture  any  frac- 
tional part  of  any  month,  pasturage  shall  only 
be  paid  proportionately,  and,  wliL-n  the  pas- 
turage becomes  exhausted  as  not  to  fatten 
said  steers,  and  some  hay  is  fed.  then  the 
price  is  to  be  on  the  pasturage  as  the  quantity 
of  hay  is  fed.  allowing  28  pounds  of  hay  for  a 
full  24  hours"  feed  for  each  head;  for  instance, 
if  14  pounds  of  hay  is  fed  per  day,  then  45 
cents  per  month  per  head  is  to  be  paid,  and 
pro  rata  more  or  less  in  that  proportion,  as 
the  case  may  be.  until  the  cattle  are  entirely 
confined  to  the  feeding  pens,  and  $o  per  ton 
is  to  be  paid  for  each  and  every  ton  of  hay 
fed  between  this  day  and  April  1,  ISSJO.  And 
the  first  party  agrees  to  fence  off  around  each 
bunch  of  stacks  a  sufficient  number  of  large 
feeding  pens,  and  sufficiently  strong  to  hold 
the  cattle  without  fear  of  them  getting  away; 
also,  to  furnish  a  good,  comfortable,  dry  house 
for  the  use  of  the  men  engaged  in  feeding  and 
caring  for  said  stock;  also,  to  furnish  a  good 
supply  of  water  troughs  in  each  pen,  with 
pipes,  etc..  from  the  tanks,  wells,  and  pumps, 
to  be  equipped  and  furnished  in  good  order, 
and  sufficient  to  plentifully  water  all  of  said 
cattle  at  all  times,  and.  if  it  is  found  necessa- 
ry to  save  hay  while  feeding,  feeding  racks 
are  to  be  made  around  the  fence.  Cattle  may 
be  taken  out  and  others  put  in  at  any  time. 


And  the  said  party  of  the  second  part.  In 
consideration  of  the  said  covenants,  prom- 
ises, and  agreements  on  the  part  of  the  said 
party  of  the  first  part  hereinafter  contained, 
covenant,  promise,  and  agree  to  and  with  the 
party  of  the  fu-st  part  that  the  said  party  of 
the  second  part  will,  on  turning  cattle  on 
said  alfalfa  fields,  pay  $2,500  as  the  fii-st  pay- 
ment on  the  hay,  and  at  the  end  of  each 
and  every  month  pay  the  amount  of  all  the 
pa.sturage  used  dm-ing  the  months  just  past. 
On  or  before  November  1, 1889.  both  of  the  par- 
tics  hereto  is  to  cut  off  ten  feet  from  the  end 
of  an  average  stack,  and  weigh  it,  and  aver- 
age the  balance  by  that,  and,  as  soon  as  the 
amount  is  found,  one-half  of  all  the  money  it 
comes  to  is  to  be  paid,  and  seventy-five  days 
thereafter  one-half  of  the  balance  due  is  to 
be  paid,  and  at  the  end  of  the  time  all  is  to 
be  paid."  In  pursuance  of  the  aforesaid 
agreement,  James  placed  his  cattle  upon  the 
fields  of  Lassing,  where  they  remained  about 
six  weeks,  when  he  removed  them  therefi'om, 
and  declined  to  be  further  bound  by  the  terms 
of  the  contract.  This  action  was  brought  by 
Lassing  to  recover  the  value  of  the  hay  at  $.> 
per  ton,  and  also  the  price  of  the  pasturage  as 
agreed  upon.  The  plaintiff  credited  defend- 
ant with  the  payment  of  .S2..JUU,  made  at  the 
time  the  contract  was  enteretl  into,  and  also 
allowed  him  the  further  sum  of  §3,423,  paid  to 
plaintiff  by  an  insurance  company  for  a  loss  of 
a  portion  of  the  hay  by  fire,  plaintiff  having 
taken  out  a  policy  thereon  after  James  re- 
moved his  cattle  from  the  premises.  In  ad- 
dition to  the  denials  of  the  answer,  defend- 
ant set  out  a  cross  complaint,  claiming  dam- 
ages to  the  amount  of  about  §6.090  for  in- 
jury to  the  cattle  by  reason  of  plaintiff's 
breach  of  agreement  in  the  manner  in  which 
he  cared  for  them.  The  cross  complaint  was 
held  to  be  imsupported  in  the  evidence  by  the 
trial  com't,  and  judgment  went  for  plaintiff. 
This  is  an  appeal  from  such  judgment  and 
from  the  order  denying  a  motion  for  a  new 
trial. 

There  is  no  question  raised  by  appellant. 
James,  as  to  the  amount  allowed  by  the 
court  for  pasturage  of  the  cattle,  but  the  chief 
bone  of  contention  appears  to  be  as  to  the 
amount  of  hay  that  James  really  purchased; 
and  that  brings  us  to  a  construction  of  the 
agreement  itself.  It  is  contended,  upon  the 
one  side,  that  James  was  only  to  pay  for  the 
hay  used  in  feeding  his  cattle;  while  it  is  in- 
sisted, upon  the  other,  that  James  bought  the 
entire  nine  stacks  of  hay,  and  that  his  liabil- 
ity to  pay  therefor  was  incurred  whether  or 
not  the  hay  was  actually  fed  to  the  cattle. 
I'pon  the  face  of  the  contract  there  seems  to 
be  some  inconsistency  as  to  its  provisions  in 
this  regard.  In  one  part  it  is  provided  that 
•five  dollars  per  ton  is  to  be  paid  for  each 
and  eveiT  ton  of  hay  fed  between  this  date 
and  April  1.  1890";  while  the  last  clause  pro- 
vides in  terms  for  the  measuring  of  the  en- 
tire nine  stacks  of  hay  for  the  purpose  of  de- 
termining the  number  of  tons  therein,   ani 


144 


WHEN   TITLE  PASSES. 


further  pnivides  for  partial  pavments  there- 
for, aud  the  respective  times  when  such  pay- 
ments are  to  be  made,  and  also  fixes  the  date 
of  final  payment  of  the  balance  due.  The 
cont"act  is  inartiticia'.ly  drawn,  and  from  all 
points  indicates  the  handiwork  of  a  laynuin. 
At  the  same  time  the  inconsistency  or  repn.ir- 
nancy  present  in  the  two  portions  of  the  con- 
tract cited  is  more  seemiu?  than  real.  These 
two  provisions  are  certainly  not  du-ectly  cou- 
flictiuET.  James,  as  indicated  by  the  first 
clause  quoted,  agreed  to  pay  for  all  the  hay 
used  pi-ior  to  April  1.  ISiHX  The  second  clause 
quoteil  is  simply  broader,  and  reaches  fur- 
ther, for  by  that  clause  he  agrees  to  pay  for 
all  the  hay  in  the  nine  stacks.  Section  1S.j8 
of  the  Code  of  Civil  Procedure,  in  speakin?  as 
to  the  Interpretation  of  contracts,  provides 
that:  "'Where  there  ai-e  several  provisions  or 
particulars,  such  a  ccnsTruetion  is.  if  possi- 
ble, to  be  adopted  as  will  give  effect  to  all." — 
and  by  vh-tue  of  this  canon  of  construction  we 
avoid  a  seeming  contradiction  in  these  two 
provisions,  and  allow  them  both  to  stand. 
There  are  also  provisions  of  the  Civil  Code 
which,  when  applied  to  the  facts  here  pre- 
sented, overthrow  appellant's  position  as  to 
the  true  constiiietion  of  this  conti-aet.  Sec- 
tion KMO  provides:  "If  the  terms  of  a  prom- 
ise ai-e  in  any  respect  ambiguous  or  uncertain, 
it  must  be  inten)reted  in  the  sense  in  which 
the  promisor  believed  at  the  time  of  making 
it  tliat  the  promisee  undei'stood  it."'  If 
James*  promises  of  payment,  when  taken  to- 
gether, are  ambiguous  and  uncertain,  then, 
under  the  oral  evidence  of  Lassing.  there  is 
no  question  but  that  both  parties  nnelerstood 
that  James  was  buying  all  the  hay  at  §5  per 
ton.  Lassing  not  only  believed  such  to  be 
the  contract,  but  James,  the  promisor,  be- 
lieved Lassing.  the  promisee,  so  understood 
it.  These  conditions  are  conclusively  shown 
by  Lassiug's  testimony,  and  James,  when  up- 
on the  witness  stand,  in  no  way  offered  con- 
tradictory evidence.  Section  lf>j4  of  the  Civ- 
il Code,  provides:  "In  cases  of  uncertainty 
not  removed  by  the  preceding  rules,  the  lan- 
guage of  a  contract  should  be  interpreted 
most  sti'ongly  against  the  party  who  caused 
the  uncertainty  to  exist.  The  promisor  is 
presumed  to  be  such  paity.  *  *  *'*  James 
is  the  promisor,  and,  by  virtue  of  this  sec- 
tion of  the  Code,  he  is  presumed  to  be  the 
party  who  caused  the  uncertainty:  but.  be- 
yond this,  he  was  the  party  who  actually 
caused  it,  for  he  prepared  the  contract,  and 
therefore  it  should  be  interpreted  most 
strongly  against  him.  Again,  section  IWO 
provides:  "When  through  fraud,  mistake  or 
accident,  a  written  contract  fails  to  express 
the  real  intention  of  the  parties,  such  inten- 
tion is  to  be  regarded,  and  the  erroneous 
parts  of  the  writing  disregarded."  We  think 
the  provisions  of  this  section  may  be  prop- 
erly invoked  in  behalf  of  respondent's  con- 
tention. James  prepared  the  written  con- 
tract in  San  Francisco,  and  brought  it  to  Las- 
sing at  his  home  for  him  to  sign.     At  that 


time  the  contract  did  not  contain  the  provi- 
sion providing  for  the  measurement  of  the 
hay.  and  the  partial  payments  therefor  ac- 
conling  to  the  number  of  tons  found  to  be  in 
the  stacks,  but  it  coutaiued  a  provision  pro- 
viding for  tlie  payment  of  all  the  hay  used, 
at  the  rate  of  $5  per  ton.  The  contract  thus 
presented  to  Lassing  he  refused  to  sign,  in- 
sisting that  James  should  take  all  the  hay, 
or  none.  Thereupon  James,  in  compliance 
with  Lassiug's  demands,  erased  from  the  con- 
tract as  presented  the  provision  as  to  paying 
for  the  hay  used,  and  added  thereto  the  pro- 
vision as  to  taking  all  the  hay.  It  now  ap- 
pears that  a  provision  of  general  similar  im- 
port to  the  one  erased  still  remained  in 
another  portion  of  the  contract;  but  the  cir- 
cumstances all  show  that  it  was  an  over- 
sight upon  the  part  of  both  parties  in  not  also 
striking  that  provision  from  tne  eouiract,  and 
it  is  evident  that  it  was  omitted  to  be  done 
pm-ely  through  mistake.  It  was  not  intend- 
ed to  be  left  there,  and,  tested  by  section 
HMO.  should  be  disregarded  in  the  interpreta- 
tion thereof. 

The  facts  and  circum-stances  surrounding 
the  making  of  this  contract  appear  in  the 
record  by  the  uncontradicted  evidence  of  the 
respondent.  Lassing.  Appellant,  in  his  reply 
brief,  strenuously  attacks  the  rulings  of  the 
court  in  admitting  this  evidence.  It  is  claim- 
ed that  such  parol  evidence  was  inadmissible 
as  tending  to  contradict,  add  to.  and  vaiy  the 
terms  of  the  written  contract.  But  we  are 
clear  to  the  contrary.  The  contract  has  not 
been  changed  by  Lassiug's  evidence.  Noth- 
ing has  been  added  thereto.  No  term  has 
been  nullified  or  even  modified.  The  sec- 
tions of  the  Code  we  have  quoted  relating  to 
the  construction  and  iuteii)retatiou  of  con- 
tracts contemplate  the  introduction  of  parol 
evidence.  For  it  is  only  upon  the  introduc- 
tion of  such  evidence  that  it  can  be  ascer- 
tained whether  or  not  the  principles  of  law 
embodied  in  those  sections  are  pertinent  and 
applicable  to  the  facts  of  any  particular  case. 
We  conclude  that  appellant  agreed  to  take 
all  the  hay  simated  in  the  nine  stacks.  The 
clause  of  the  contract  as  to  the  measurement 
of  the  hay  and  the  payment  therefor  is  as 
follows:  "On  or  before  November  1,  18S9. 
both  of  the  parties  hereto  is  to  cut  off  ten 
feet  from  the  end  of  an  average  stack^  and 
weigh  it,  and  average  the  balance  by  that, 
and.  as  soon  as  the  amount  is  found,  one-haif 
of  all  the  money  it  comes  to  is  to  be  paid, 
and  seventy-five  days  thereafter  one-half  of 
the  balance  due  is  to  be  paid,  and  at  the  end 
of  the  time  all  is  to  be  paid."  Appellant 
contends  that  this  clause,  standing  alone,  is 
simply  an  executory  agreement  for  the  sale 
and  purcha.se  of  all  the  hay  in  the  nine 
stacks,  and  that,  consequently,  the  title  to  the 
hay  has  never  passed  to  James.  It  is  in- 
sisted that  the  contract  was  executory  in 
this,  that  the  hay  was  never  measured  and 
the  amount  ascertained,  as  provided  in  the 
conti-act.  and  that  the  measurement  and  de- 


WHEN  TITLE  PASSES. 


14; 


termination  as  to  the  amount  were  condi- 
tions precedent  to  the  passing'  of  the  title. 
We  are  clear  that  the  afireement  to  ascertain 
the  number  of  tons  of  hay  at  some  future 
time  by  weijrht  and  measurement  in  no  way 
affected  the  question  as  to  the  present  pass- 
ins  of  the  title.  All  the  hay  in  the  nine 
stacks  was  purchased,  at  the  rate  of  .'?.")  ijer 
ton.  The  number  of  tons  was  immaterial 
as  bearin;;,'  upon  the  question  of  a  valid  trans- 
fer. The  final  determination  as  to  the  num- 
ber of  tons  was  only  material  as  fixinj;  the 
amount  of  money  to  be  paid.  The  subse- 
quent measurement  and  ascertainment  of  the 
exact  number  of  tons  could  in  no  way  fur- 
nish any  grounds  for  the  rejection  or  repu- 
diation of  the  sale  by  either  paitj*.  The  hay 
was  identified  and  the  price  per  ton  agreed 
upon  at  the  date  of  the  contract,  and  these 
only  were  the  essentials  nece.ssary  to  consti- 
tute a  valid  sale,  for  the  sale  was  made  re- 
gardless of  the  amount  of  the  hay,  and  thus 
necessarily  became  complete  and  perfect 
when  the  contract  was  entered  into  and  part 
payment  made  thereunder.  In  Klackwood  v. 
]\acking  Co.,  76  Cal.  212.  18  Fac.  248.  a  case 
involving  the  principle  here  discussed,  this 
court  s-aid:  '"Some  of  the  American  cases 
are  not  in  accord  with  the  rule  laid  down 
by  Mr.  IJenjamin  in  this,  that,  if  tiie  goods 
are  identified,  it  does  not  matter  that  weigh- 
ing or  measuring  is  nece.ssary  to  ascertain 
the  price  or  the  quantity,  and  this  seems  to 
be  the  law  in  California,  for  the  Civil  Code 
contains  the  following:  'Sec.  1140.  The  title 
to  personal  property  sold  or  exchanged  pass- 
es to  the  buyer  whenever  the  parties  agree 
upon  a  present  transfer,  and  the  thing  itself 
is  identified,  whether  it  is  separated  from  oth- 
er things  or  not."'  After  James  repudiated 
the  contract,  removed  his  cattle  from  the 
fields,  and  left  the  hay  in  the  stacks,  appel- 
lant contends  that  it  was  the  duty  of  Las- 
sing  to  sell  the  hay  to  the  best  advantage 
possible,  and.  if  it  failed  to  bring  $.j  per  ton, 
then  the  right  accrued  to  recover  from  James 
the  difference.  In  a  case  like  the  present, 
where  the  title  to  personal  property  has  pass- 
ed, there  is  no  obligation  resting  upon  the 
vendor  to  resell.  In  many  cases  he  would 
have  no  right  to  resell,  and  possibly  would 
be  guilty  of  an  act  of  conversion  if  he  exer- 
cised any  such  dominion  over  the  property; 
but  upon  the  facts  of  this  case,  under  any 
principle  of  law  which  appellant  might  ad- 
vance, Lassing  had  the  right  to  choo.se  his 
remedy,  as  between  suing  for  the  entire  pur- 
chase price  or  selling  the  property  and  bring- 
ing an  action  for  the  difference  in  case  the 
sale  resulted  in  a  less.  Hunter  v.  Wetsell, 
84  N.  y.  5.J.5;  Dustan  v.  McAndrew.  44  X. 
Y.  72;  Van  Horn  v.  Rucker,  84  Am.  Dec.  .53. 
It  is  insisted  that  Lassing  so  materially 
failed  to  cany  out  the  covenants  of  the  con- 
tract upon  his  part  to  be  performed  that 
James  was  justified  in  repudiating  the  con- 
tract and  withdrawing  from  under  its  provi- 
sions.    Of    course,    such    cojiduct    upon    the 

VAK  ZrLE  SEL.  CAS. SALES — 10 


part  of  James  could  only  be  justifie<l  upon 
the  princii)le  that  the  covenants  to  be  per- 
fonned  by  the  respective  parties  were  entire- 
ly mutual  and  dependent  upon  each  other. 
And,  in  view  of  what  we  have  already  said 
as  to  the  purchase  of  the  hay,  possiljly  .lames' 
only  reme<ly  for  a  breach  of  the  contract 
would  be  an  action  of  damages  in  the  nature 
of  a  recoupment;  but  we  do  not  deem  it  nec- 
essary to  enter  into  a  discussion  as  to  the 
mutuality  and  deijeudency  of  these  respec- 
tive covenants,  for  we  thinii  no  material  and 
substantial  breach  of  the  contract  was  ever 
committed  by  Lassing.  By  its  terms  he  was 
to  do  various  things,  and  in  pursuance  of  his 
agreement  it  is  conceded  that  he  performed 
all  of  the  things  to  be  done  by  him,  and  at 
considerable  labor  and  expense,  except  in  a 
single  respect.  The  contract,  after  reijuijing 
Lassing  to  furnish  a  plentiful  supply  of  wa- 
ter for  the  cattle,  coirtinues:  "And,  if  it  is 
necessary  to  save  hay  while  feeding,  feeding 
racks  are  to  be  made  around  the  fence."  It 
is  now  claimed  that  Lassing  failed  to  live 
up  to  his  contract  in  this  regard,  and  the  al- 
leged breach  of  this  i)rovision  of  the  con- 
tract is  relied  upon  to  furnish  material  suffi- 
cient to  demand  a  reversal  of  the  judgment. 
Upon  this  issue  the  court  made  the  following 
finding  of  fact:  '"That  it  was  never  found 
necessary  on  the  18th  day  of  October,  188'J, 
or  at  any  time,  to  furnish  feeding  racks 
around  the  fence  to  save  hay  while  fewling 
the  cattle  of  defendant,  nor  was  any  nece??si- 
ty  for  feeding  racks  ever  known  to  plaintiff, 
nor  did  plaintiff  wholly  or  at  all  omit,  fail, 
neglect,  or  refuse  to  furnish  the  same,  nor 
was  defendant  compelled  to,  nor  did  he.  re- 
move any  of  his  cattle  from  plaintiff's  land 
or  premises  because  of  the  failure  of  plaintiff 
to  build  said  racks,  nor  did  defendant,  nor 
was  he  compelled  to,  remove  any  of  his  cat- 
tle by  any  act  of  plaintiff,  nor  did  defendant 
suffer  any  loss,  injuiy,  or  damage  in  any 
sum  of  money  by  any  act  of  plaintiff,  or  l:>y 
any  absence  of  fee<ling  racks,  or  at  all."  As 
to  its  indefiniteness.  the  foregoing  covenant 
of  the  contract  stands  fully  at  par  with  the 
other  provisions,  but,  conceding  to  it  all  the 
force  and  effect  that  appellant  claims,  and 
that  the  provision  not  only  demanded  that 
Lassing  should  furnish  feeding  racks  when 
necessary,  but  tliat  a  mistake  in  judgment 
upon  his  part  as  to  the  time  when  that  ne- 
cessity arose  would  furnish  grounds  for  a  re- 
ptuliation  of  the  contract  upon  the  part  of 
James,  however  innocent  Lassing  might  be 
in  making  such  mistake,  still  the  finding  of 
fact  which  we  have  quoted  stands  as  a  bar 
to  a  favorable  conclusion  to  appellant  upon 
this  contention.  The  finding  in  effect  de- 
clares: (1)  It  was  never  necessary  to  fur- 
nish the  feeding  racks:  (2)  that  appellant 
did  not  remove  his  cattle  from  plaintiff's 
lands  because  of  the  failure  to  furnish  said 
feeding  racks;  (oj  that  appellant  suffered  no 
loss  or  damage  by  reason  of  the  absence  of 
such  racks.    This  finding  of  fact,  as  we  look 


146 


AVHEN   TITLE  PASSES. 


upon  it,  in  each  of  its  particular  brandies  is 
fatal  to  appellant's  claims,  if  supported  by 
the  evidence;  for.  aside  from  that  portion  of 
the  finding  declaring  in  effect  that  racks 
were  not  necessary,  it  is  found  from  the  evi- 
dence that  James  deserted  the  premises  and 
removed  his  cattle  therefrom  for  other  causes, 
—causes  in  no  way  attributable  to  Lassing, 
and  for  which  he  was  in  no  way  responsible. 
If  this  portion  of  the  finding  be  true,  then 
James  cannot  now  rely  tipon  a  breach  of  the 
contract  as  a  grotind  for  repttdiation  which 
in  his  mind  at  the  time  in  no  waj*  formed  an 
element  entering  into  the  attempted  repudia- 
tion or  rescission  tipon  his  part.  Again,  it 
is  found  that  he  suffered  no  loss  or  damage 
as  to  his  cattle  by  reason  of  the  failure  of 
Lapsing  to  furnish  the  racks.  If  this  be  so, 
James  was  not  excused  in  law  from  carrying 
out  all  the  covenants  upon  his  part  to  be  per- 
formed. If,  in  fact,  he  suffered  no  injury  or 
damage  bj'  a  breach  of  the  contract,  such 
breach  was  harmless,  and  gave  him  no  cause 
of  complaint.  Certainly  no  action  of  dam- 
ages could  be  based  thereon  by  him;  neither 
would  it  be  such  a  substantial  default  as  to 
afford  grounds  for  a  rescission  or  repudia- 
tion. While  upon  some  of  these  questions 
there  may  be  said  to  be  a  substantial  conflict 
in  the  evidence,  yet  we  think  every  branch 
of  this  finding  of  fact  has  substantial  stip- 
port  in  the  evidence  found  in  the  record.  It 
will  be  obsen^ed  that  feeding  racks  were  to 
be  furnished  when  it  became  necessary  "to 
save  hay."  Hence,  it  is  evident  that  a  breach 
of  this  provision  cotdd  only  result  in  damage 
to  James  for  a  loss  of  hay.  Yet  he  makes  no 
claim  in  his  complaint  for  a  loss  of  that  char- 
acter, but  attempts  to  recoup  in  damages  for 
a  loss  of  weight  in  the  cattle  by  a  lack  of  suf- 
ficient pasturage  and  hay.  As  to  damages 
claimed  in  the  nature  of  recoupment,  it 
wotild  almost  seem  conclusive  against  the 
claim  to  such  that  there  is  nothing  whatever 
in  the  contract  reqtiiring  Lassing  to  furnish 
sutficient  feed  to  keep  the  stock  in  prime  con- 
dition. When  the  contract  was  made,  the 
feed  was  upon  the  ground,  both  pasturage 
and  hay,  and  it  was  James'  feed,  regardless 
of  quality  or  quantity,  and  was  to  be  fed  by 
him  at  such  times  and  quantities  as  he  saw 
tit.  There  is  some  claim  that  James  subse- 
quently, by  parol,  made  Lassing  his  agent  to 
take  charge  of  the  cattle  and  care  for  them. 
Conceding  as  much,  a  neglect  of  duty  by 
Lassing  under  such  contract,  and  damages 
resulting  therefrom,  would  be  a  matter  en- 
tirely foreign  to  any  qtiestion  of  feeding 
racks.  In  addition  to  and  beyond  all  this, 
the  evidence  fully  supports  the  finding  that 
the  lack  of  feeding  racks  in  no  way  was  the 
catise  of  damage  and  loss  to  James,  conced- 
ing such  damage  and  loss  to  have  occurred. 
Again,  the  finding  of  fact  to  the  effect  that 
the  absence  of  feeding  racks  was  not  the 
cause  of  the  removal  of  the  cattle  by  James 
finds  ample  support  in  the  evidence.  Owing 
to  the  warm,  copiotis,  and  unexpected  rains 


of  tlie  months  of  September  and  October, 
the  fields  had  become  soft  and  miry,  which 
fact  interfered  largely  with  the  welfare  of 
the  cattle,  and  furnished  a  strong  argument 
for  James'  action  in  removing  them.  And.  as 
an  additional  cause  for  their  removal,  and 
probably  the  controlling  one,  these  same 
warm  rains  had  caused  a  growth  of  giass 
vipon  .James'  own  land  fully  sufficient  for  all 
his  needs  and  ptirposes. 

Conceding  that  an  error  of  judgment  upon 
Lassing's  part  as  to  the  date  when  he  wa.s 
re(iuired  to  furnish  the  racks  is  fatal  to 
his  case,  still,  under  the  evidence,  the  finding 
of  the  court  to  this  point  has  stipport.  A 
mistake  of  judgment  as  to  this  particular 
time,  entailing  upon  him  the  severe  penal- 
ties here  claimed,  should  not  be  held  against 
him  unless  clearly  apparent  from  the  evi- 
dence. We  think  his  conduct  and  acts  in 
this  regard  should  be  lil^erally  interpreted 
in  his  favor;  and,  so  interpreted,  we  conclude 
the  breach,  if  one  occurred,  was  not  a  sub- 
stantial one,  but  purely  tec-hnical.  Weeks 
before  the  cattle  were  removed  Lassing  bad- 
made  arrangements  with  a  dealer  to  have  the 
lumber  upon  the  ground  1o  build  the  racks 
upon  24  hours'  notice.  He  had  fed  the  hay 
for  two  days  only  when  James  came  upon  the 
ground  and  ordered  an  immediate  removal 
of  the  cattle.  Under  the  written  contract,  it 
is  clearly  contemplated  that  James  shotild 
feed  the  hay,  and  the  inference  naturally 
arises  that  Lassing  would  be  notified  when 
racks  were  required,  btit.  under  a  subsequent 
parol  agreement,  Lassing  was  hired  to  feed 
the  hay,  and,  as  stated,  he  had  only  fed  it 
two  days  when  James  came  upon  the  ground 
and  ordered  an  immediate  removal  of  the 
cattle.  It  thus  appears  to  have  been  left  to 
Lassing  alone  to  determine  when  hay  should 
be  fed,  and  for  this  reason  the  novel  condi- 
tions arise  that,  if  Lassing  had  decided  not 
to  feed  hay  during  these  few  days,  then  the 
feeding  racks  would  not  haA'e  been  required^ 
and  no  breach  would  have  occurred.  Las- 
sing states  that  he  placed  the  hay  upon  the 
high  and  gravelly  ground;  that  he  did  not 
think  the  time  had  arrived  for  the  racks  to 
be  used;  that  neither  James  nor  any  of  his 
men  had  requested  or  suggested  to  him  to 
make  and  place  them;  that,  immediately- 
prior  to  the  removal  of  the  cattle,  James 
neither  demanded  that  he  furnish  the  racks, 
nor  notified  him  that  he  was  removing  the 
cattle  for  the  reason  that  they  were  not  ftir- 
nished,  and  that  he  could  and  would  have 
furnished  them  within  a  very  few  days  if 
James  had  so  requested.  T'pon  .such  a  state 
of  facts  we  think  this  portion  of  the  finding 
of  the  court  should  be  upheld. 

For  the  foregoing  reasons  we  conclude  the 
judgment  and  order  should  be  attirmed,  and 
it  is  so  ordered. 

We  concur:  HARRISON,  J.;  VAN  FLEET. 
J.;  McFARLAND,  J.;  TEMPLE,  J.;  HEN- 
SHAW,  J. 


WHEN   TITLE  PASSES. 


147 


WIND  et  al.   v.  ILER  ct  al. 

(CI  N.  W    KKil.i 

Supreme  Court  of  Iowa.      Jan.  21.   1805. 

Appeal  from  district  court,  Mills  county; 
N.  W.  Macy.  Jud.sre. 

Action  at  law  to  recover  money  paid  by 
plaintiff  to  defendants  for  intoxicating  liq- 
uors during  the  years  1881.  1S82.  1SS3.  and 
1884.  There  was  a  trial  to  a  jury,  and  at 
the  conclusion  of  plaintiff's  evidence,  de- 
fendants moved  the  court  for  a  verdict.  The 
motion  was  sustained,  and  verdict  and  .indjr- 
meut  rendered  for  defendants,  and  plain- 
tiff appeals.    Affirmed. 

E.  R.  Duffie.  .John  P.  Breen.  and  .John  Y. 
Stone,  for  appellant.  Congdon  A:  Hunt. 
James  M.  Wool  worth,  and  Smith  McPher- 
.son.  for  appellees. 

DEEMER,  J.  Plaintiff  is  a  copartnership 
composed  of  X.  P.  Wind  and  George  F. 
Silvers,  heretofore,  and  during  the  years 
INSI.  1882,  1SS3.  and  1884.  doing  business  as 
wholesale  and  retail  liquor  dealers  in  the 
city  of  Ottumwa.  Iowa.  Defendant  Her  & 
Co.  is  a  copartnership  composed  of  the  other 
defendants,  doing  p  wholesale  liquor  busi- 
ness in  the  city  of  Omaha.  Neb.  Sometime 
during  the  latter  part  of  the  year  1S81  de- 
fendants' traveling  man.  one  Gilmore.  called 
upon  the  plaintiffs  at  their  place  of  business 
in  Ottumwa  to  induce  them  to  order  some  liq- 
uors from  the  firm  which  he  represented. 
The  evidence  shows  without  conflict  that  this 
agent  had  no  authority  to  make  sales.  He 
had  power  to  take  orders,  which  were  sub- 
mitted to  the  defendants  for  their  rejection 
or  approval,  and.  if  approved,  the  goods  or- 
dered were  shipped  to  the  proposed  purchas- 
er. Plaintiffs  gave  this  agent  an  order  for 
.some  goods,  which  was  submitted  to  the 
defendants,  and  by  them  approved,  and  the 
liquors  were  delivered  to  the  raih-oad  com- 
pany for  shipment  to  plaintiffs  at  Ottumwa. 
plaintiffs  paying  the  freight  thereon.  An 
arrangement  was  made  between  the  plain- 
tiffs and  defendants'  agent  by  which  plain- 
tiffs might  thereafter  order  such  liquors  as 
they  desired  by  mail  or  by  telegram,  and 
in  accordance  with  this  arrangement  they 
ordered  large  quantities  of  liquor,  which 
they  paid  for  through  the  Ottumwa  banks  in 
response  to  drafts  made  upon  them  for  the 
purchase  price.  All  liquors  so  paid  for.  ex- 
cept three  bills,  were  ordered  by  wire  or 
mail.  It  is  claimed  by  the  plaintiffs  that  all 
these  various  sales  of  liquor,  amounting  in 
number  to  about  SO.  and  in  value  to  more 
than  .S2.000.  were  unlawful  and  that  they 
are  entitled  to  recover  all  payments  made 
th!>reon.  under  Code.  §  l.j.">0.  which  provides 
that  all  payments  made  for  intoxicating  liq- 
uor sold  in  violation  of  our  liquor  law  shall 
be  held  to  have  been  received  in  violation 
of  law.  and  against  equity  and  good  con- 
science, and  to  have  been  received  upon  a 


valid  promise  of  the  receiver  to  pay  to  the 
person  fui'nishing  such  consideration  the  sum 
thereof. 

The  first  qtiestion  which  arises  is,  were  the 
sales  made  in  this  state'/  From  what  we 
have  already  stated  it  would  appear  that  the 
sales  were  each  and  all  made  in  Nebraska. 
But  plaintiffs  contend  that,  while  the  defend- 
ants' agent  may  have  had  no  authority  to  do 
more  than  take  their  orders  for  the  goods, 
yet  there  is  testimony  tending  to  show  that 
the  licpiors  were  all  shipped  subject  t<» 
their  approval,  and  that  the  title  to  the  goods 
did  not  pass  until  the  liipiors  were  received 
and  tested  by  them.  The  testimony  on  this 
point  is  as  follows:  Witness  George  W. 
Silvers  said,  in  substance,  that  Gilmore.  the 
agent,  said:  "If  the  goods  isn't  satisfactory 
after  you  receive  them,  you  can  send  them 
back  to  Omaha."  And  Silvers  told  him  (Gil- 
more) if  the  goods  were  not  as  he  said  they 
should  come  back.  "The  goods  came,  and  we 
inspected  them.— gauged  them.  We  had  a 
government  gauge  there. — a  thermometer  we 
called  a  "tester.'  We  tested  the  goods  before 
we  paid  the  freight.  Gilmore  said.  'If  you  re- 
ceive the  order  all  in  good  sh.ape.  and  the 
goods  are  satisfactory,  and  you  need  any 
more,  and  I  am  not  around,  why.  send  your 
orders  in  to  the  house,  and  they  will  be 
filled.'  "  This  witness  further  testified  that 
when  the  goods  came  to  the  depot  at  Omaha 
they  were  taken  by  a  drayman  from  the 
freight  house,  and  delivered  at  plaintiffs' 
place  of  business,  the  drayman  paying  the 
freight  in  the  first  instance,  and  afterwards 
collecting  it  from  the  plaintiffs.  Witi:e:'s 
further  testified  that  one  bill  of  goods  which 
plaintiffs  ordered  shipped  to  Des  Moines,  to 
a  customer  of  theirs  at  that  place,  was  re- 
turned, and  credit  asked  of  defendants  the'-e- 
for.  and  that  defendants  gave  them  a  small 
discount  on  one  of  their  bills.  He  further 
said:  "If  they  were  not  satisfactory,  they 
were  to  be  returned.  That  was  the  contra  -t. 
We  never  returned  any  from  Ottumwa." 
Witness  Wind  testified  that  Gilmore  said: 
"If  his  goods  were  not  as  represented  we 
had  the  privilege  of  returning  them.  We 
told  him  we  wanted  to  examine  the  goods 
after  they  came,  and  see  if  they  suited  us. 
He  .«aid  we  had  that  privilege.''  "We  had 
a  gauge  or  whisky  tester  that  we  used.  We 
took  out  the  bung,  and  took  a  little  out.  and 
used  the  tester.  We  told  Mr.  Gilmore  our 
method  of  examining  it.  He  said  it  was  sat- 
isfactory." Witness  Silvers  also  testified  that 
within  three  or  fotu*  days  after  giving  the 
order  the  plaintiffs  received  a  bill  for  the 
goods,  and  entries  were  then  made  on  the 
plaintiffs'  ledger  of  the  amount  of  the  bill. 
It  is  an  elementary  proposition  of  law.  need- 
ing no  citation  of  authority  in  its  support, 
that  title  passes  in  the  sale  of  personal  prop- 
erty when  from  all  circumstances  sm-round- 
ing  the  transaction  it  is  evident  that  the  i)ar- 
tjes  to  the  sale  intended  it  to  pass.  It  is 
wholly  a  question  of  intention  to  be  arrived 


148 


WHEN  TITLE  PASSES. 


at  from  the  contract  and  the  acts  and  con- 
duct of  tho  parties  thereto.  In  the  absence 
of  all  stipulations  and  conditions  iu  the  con- 
tract, the  title  will  be  presumed  to  pass, 
when  the  parties  live  at  different  places, 
when  the  soods  are  delivered  by  the  seller 
to  a  transportation  company  for  carriage  to 
the  buyer,  subject  to  the  seller's  lien  or  ri^ht 
of  stoppajje  in  tiansitu.  This  is  certainly  the 
rule  where  the  buyer  is  to  pay  the  freight. 
It  is  also  a  general  rule  that  the  buyer  has  a 
rijiht  to  inspect  unascertained  yoods  to  de- 
teiMuiue  whether  they  are  such  as  are  bar- 
jiained  for  or  not.  Xewm.  Sales.  §  '2~>2;  Benj. 
Sales  (Hennett's  Ed.)  pp.  GIJ'.MJIXJ;  Hirshhorn 
V,  Stewart,  40  Iowa,  41S.  This  ri.iiht  of  in- 
spection, however,  does  not  of  itself  post- 
pone the  passing  of  the  title.  It  simply  au- 
thorizi^s  a  rescission  of  the  sale  in  the  event 
the  goods  are  not  as  couti-aeted  for.  So  that 
the  re.-;ervation  of  the  right  to  inspect  the 
goods  by  the  plaintiffs  in  this  case  does  not 
of  itself  indicate  that  title  was  not  to  pass 
until  the  goods  were  tested,  for  it  gives  to 
plaintiffs  no  greater  rights  than  they  would 
have  had  under  the  law  without  such  reser- 
vation. 

It  is  claimed  that  by  the  terms  of  the  con- 
tract the  title  was  not  to  pass  until  the  plain- 
tiffs were  satisfied,  after  testing  the  liquors, 
that  they  were  the  kind  ordered.  The  law 
has  made  a  somewhat  refined,  yet  no  less 
obvious,  distinction  between  an  option  to  pur- 
chase if  satisfactory  and  an  option  to  return 
if  not  sritisfaetory.  In  the  one  case  title  will 
not  pass  until  the  option  is  determined,  and 
iu  the  other  case  the  property  passes  at  once, 
subjrct  to  the  right  to  rc-clnd  and  return. 
The  former  may  be  said  to  be  a  conditional 
sale,  and  the  latter  has  bsen  denominated  a 
""sale  or  return."  Hunt  v.  Wymau,  lUO  Mass. 
IDS;  Foley  v.  Felrath  (Ala.)  13  South.  485; 
Newm.  Sales.  §  310;  Buswell  v.  Blckndl.  17 
Me.  344;  Benj.  Sales  (Bennett's  Ed.)  p.  509, 
and  cases  cited.  It  is  also  well  settled  that 
the  rule  that  title  does  not  pass  so  long  as 
anything  remains  to  be  done  to  the  goods  to 
ascertain  their  value,  quality,  or  (piaility.  is 
only  applicable  to  cases  of  constructive  de- 
livei-y.  Bogy  v.  Rhodes,  4  G.  Greene.  133. 
Under  this  rule  the  right  reserved  to  plain- 
tiffs to  inspect  and  test  the  goods  after  they 
came  into  their  actual'  possession  would  not 
operate  to  postpone  the  transfer  of  title,  but 
mei-ely  gave  tliera  the  right  to  rescind  the 
ton  tract  and  return  the  goods.  See,  also,  in 
this  connection.  Foley  v.  Felrath,  supra,  and 
cases  therein  cited;  2  Kent,  Comm.  49(5.  We 
are  satisfied  from  the  fact  that  the  drayman, 
who  must  be  considered  as  plaintiffs'  agent, 
jiaid  the  freight  on  these  licpiors,  took  them 
from  the  carrier,  and  delivered  them  to  plain- 
tiff's, and  from  the  further  fact  that  the  plain- 
tiffs credited  defendants  with  the  liquors  as 
soon  as  they  received  the  bills  for  them, 
which  was  in  advance  of  the  delivery  of  tlie 
goods,  with  the  undtn'standing  that  they  were 
to  have  credit  for  such  a-s  might  be  returned, 


that  both  parties  intended  title  to  pass  when 
the  goods  were  delivered  to  the  railroad  com- 
pany at  Omaha,  Neb.,  for  transportation  to 
Ottiunwa;  and  that  the  sale  was  not  one  on 
trial  or  on  approval,  or  if  satisfactory  to 
plaintiffs,  but  rather  a  completed  sale,  witli  an 
option  in  plaintiff's  to  return  them  if  they 
did  not  meet  the  test  plaintiff's  proi)osed  to 
give  them.  Our  conclusions  tind  support  in 
the  following  cases:  f^ngs  v.  Priest,  G.j  Iowa, 
2;'.2,  21  N.  W.  .".SO;  Whitlock  v.  Workman, 
1.")  Iowa,  351;  Tegeler  v.  Shipman,  33  Iowa, 
1!>4,— and  are  not  in  conflict  with  Gipps  Brew- 
ing Co.  V.  De  France  (Iowa)  58  N.  W.  1087, 
and  Tolman  v.  .Johnson,  43  Iowa.  127.  The 
following  cases  from  other  states  are  directly 
in  point:  Schlesinger  v.  SUatton,  0  II.  I.  578; 
Mack  V.  Lee,  13  K.  I.  293;  Gill  v.  Kaufman, 
It)  Kan.  571;  McCarty  v.  Gordon,  Id.  35; 
Snider  v.  Koehler,  17  Kan.  432;  Dolan  v. 
Green.  110  Mass.  322;  Abberger  v.  Marrin, 
102  Mass.  70;  Boothby  v.  Plaisted,  51  N.  H. 
43(5.  If  the  sales  were  made  in  Omaha,  then 
they  were  not  unlawful  in  such  sense  as  that 
recovery  can  be  had  for  money  paid  thereon, 
although  there  is  evidence  in  the  record  that 
defendants'  agent  knew  plaintiff's  had  no  per- 
mit to  sell  liquors  in  this  state. — which  they 
were  at  that  time  required  to  have  to  make 
lawful  sales.  It  is  no  doubt  true  that  if  a 
nonresident  makes  sales  of  liquors  in  another 
state  to  a  resident  of  this  state,  for  the  pur- 
pose and  intent  of  enabling  the  purchaser  to 
violate  the  liquor  laws  of  this  state,  or  par- 
ticipates or  assists  in  a  design  on  the  part  of 
the  purchaser  to  dispose  of  them  unlawfully 
in  this  state,  his  complicity  in  the  illegal 
scheme  will  prevent  him  from  recovering  the 
price  in  an  action  against  the  purchaser. 
Davis  V.  Bronson,  6  Iowa,  410;  AVhitloi-k  v. 
Workman,  15  Iowa,  351;  Bank  v.  Curreu,  3() 
Iowa,  555.  And  it  is  also  true  that,  while 
mere  knowledge  on  the  part  of  the  vendor 
that  the  purchaser  intends  to  violate  the  law 
may  not  vitiate  the  sale,  yet  it  is  a  fact  from 
which  the  jury  might  infer  an  intent  to  vio- 
late such  law.  Tegeler  v.  Shipman,  supra. 
Such  unlawful  participation  in  the  illegal  de- 
sign of  the  piu'chaser  will  defeat  an  action 
by  the  seller  to  recover  the  purchase  price  of 
the  liquors  sold  on  the  grounds  of  public 
policy.  But  will  it  enable  the  purchaser  to 
recover  the  amount  of  payments  made  on  the 
conti-act  under  section  1.5.50  of  the  Code?  We 
think  not.  The  sale  in  such  case  is  not  un- 
lawful under  this  statute,  for.  as  we  have 
already  seen,  the  nonresident  has  a  perfect 
right  to  make  the  sale  in  his  state,  and  i-e- 
cover  the  purchase  price.  His  act  is  mdaw- 
ful  because  the  policy  of  the  law  forbids  his 
participation  or  assistance  in  the  violation  of 
our  laws  by  the  purchaser  of  the  liquors,  and 
on  the  grounds  of  public  policy  he  cannot 
recover.  The  statute  referred  to  gives  the 
purchaser  the  remedy  of  recovering  back  his 
payments  Avhen  the  sale  is  of  intoxicating 
liquors  in  violation  of  the  licjuor  laws  of  this 
state.     It  is  clear,  then,  that  if  the  matter 


WHEN   TITLE  i'ASSES. 


149 


had  bpou  submitted  to  tho  jury,  and  it  liad 
fcnind  that  defond:ints.  iu  malciiif,'  Ihi-  salo  in 
Omaha,  inti  ihUmI  thereliy  to  emibh>  phiiiitiffs 
to  violate  the  law  of  this  state,  there  could 
be  no  recovery  under  section  15o()  of  the 
Code.  It  must  be  remembered  in  this  con- 
nection that  all  purchasfs  and  payments 
thereon  for  which  recovery  is  sought  in  this 
action  were  made  prior  to  the  enactment  of 
what  is  known  as  the  "Wilson  Bill,"  and  it 
sliould  further  b?  borne  in  mind  that  under 
*the  decisions  of  the  United  States  supreme 
court  in  Brown  v.  Maryland,  12  Wheat.  41D; 
Bowman  v.  Railway  Co..  125  U.  S.  4(;.j,  8 
Sup.  Ct.  GS9.  1(K)2;  and  Leisey  v.  Hardin,  13."5 
U.  S.  IOC).  10  Sup.  Ct.  OSl,— sales  like  those  in 
(piestion.  if  made  in  Omaha  to  a  resident  in 
this  state,  were  perfectly  lawful  in  and  of 
themselves.  See,  also,  Richards  v.  Wood- 
ward, llo  Mass.  285.  The  statutes  of  this 
state  regulating  and  licensing  the  traffic  in 
liquors  therein  were  void,  and  of  no  effect,  so 
far  as  they  interfered'  with  commerce  be- 
tween the  states.  Lyng  v.  Michigan,  10  Sup. 
Ct.  72.">.  So  that  defendants  had  the  right  to 
sell  their  liquors  for  importation  into  this 
state  without  reference  to  our  police  regula- 
tions. The  sales  iu  and  of  themselves  were 
not  uulawful. 

I.iet  it  be  conceded,  however,  for  the  pur- 
pose s  of  this  case,  that  the  sales  of  the  liquor 
took  place  at  Ottumwa,  and  that  payments 
were  made  for  it  there.  What,  then,  is  the 
state  of  the  case?  Defendants  insist  that  if 
this  be  true,  then,  as  the  sales  were  made  in 
the  original  package  in  which  the  litpiors 
were  imported,  section  1.~».30  has  no  applica- 
tion to  them,  because  it  is  a  regulation  of 
commerce  between  the  states,  and  is  imcon- 
stitutional  under  the  cases  from  the  supreme 
court  of  the  United  States  before  cjuoted.  We 
are  well  satisfied  that  defendants'  contention 
is  correct.  Indeed,  it  is  practically  conceded 
by  the  plaintiffs"  counsel.  But  they  insist 
that  as  soon  as  the  barrels  W'ere  opened  for 
the  purpose  of  testing  the  property  became 
iuconiorated  into  the  general  mass  of  prop- 
erty in  the  state,  and  subject  to  the  police 
regulations  adopted  to  preserve  the  health 
and  morals  of  the  community.  That  section 
l.").")0  was  adopted  to  restrain  the  traffic  in  in- 
toxicants, and  to  aid  in  the  general  enforce- 
ment of  the  general  liquor  laws  of  the  state, 
in  virttie  of  the  police  power  lodged  in  the 
state,  cannot  be  doubted.  And,  if  this  be 
true,  it  is  a  direct  restraint  and  interference 
upon  trade  and  traffic  in  liquors,  and.  under 
the  decisions  before  quoted,  it  is.  or  was  prior 
to  the  enactment  of  the  Wilson  bill,  iniconsti- 
tutional  so  far  as  it  relates  to  commerce  be- 
tween  the  states  or  the  inhabitants  thereof. 


This  doctrine  finds  support  in  the  cases  of 
State  V.  Coonan,  82  Iowa.  4<)0,  48  N.  W.  021, 
and  State  v.  Corrick.  82  Iowa,  4.51,  48  X.  W. 
SOS.  What  is  said  to  the  conl/ary  in  the  case 
of  Connolly  v.  Scarr,  72  Iowa,22;J,88  N.  W.(^l, 
which  was  decided  prior  to  the  ca.se  of  Leisey 
V.  Hardin,  must  be  considered  as  overruled. 
It  is  our  duty  to  follow  the  decision  of  the 
highest  tribunal  in  this  country— the  final  ar- 
biter on  these  grave  constitutional  questions — 
without  reference  to  the  fact  that  there  is  a 
strong  dissent  to  the  doctrines  announced  by 
that  court,  which  many  of  us  think  announces 
the  better  rule.  The  question,  however,  is 
of  little  importance  at  this  time,  because  of 
the  enactment  of  the  Wilson  bill,  which  for- 
tunately gave  to  the  states  the  right  to  exer- 
cise the  police  powers  vested  in  them,  with- 
out reference  to  the  interference  the  exer- 
cise of  those  powers  might  have  upon  inter- 
state commerce. 

The  question  yet  remains,  did  the  drawing 
of  the  bung  in  the  barrels  in  which  the  liquors 
were  shipped  into  the  state  have  the  effect 
claimed  for  it  by  the  appellants?  AVe  think 
not.  The  barrel  was  opened  in  order  that  a 
small  quantity  might  be  taken  from  it  and 
tested, — not  used, — in  order  to  determine 
whether  the  liquors  would  be  returned  or  not. 
We  do  not  think  that  the  inspecting  or  test- 
ing of  an  imported  article  to  determine 
whether  it  shall  be  returned  has  the  effect  to 
make  it  a  part  of  the  general  mass  of  prop- 
erty in  the  state.  Plaintiffs,  according  to  their 
theory,  tested  it  to  see  if  they  would  accept 
it,  and  make  it  their  property.  And  if  the 
mere  act  of  testing  made  it  theirs,  there  was 
no  necessity  for  the  test,  because  it  l)ecame 
theirs  by  the  act  itself.  We  do  not  think 
they  want  such  a  rule  applied  in  this  case. 
In  Leisey  v.  Hardin,  supra,  it  is  said:  "Un- 
der our  decision  in  Bowman  v.  Railway  <^'o., 
supra,  they  had  the  right  to  import  this  b;'er 
into  the  state,  and  in  the  view  we  have  ex- 
pressed they  had  the  right  to  s;  11  it.  by  whic-li 
act  alone  it  would  be  comi.dngled  \Mth  'he 
genei'al  mass  of  property  within  tlie  st;ite. 
T"p  to  that  point  of  time,  we  bold  that,  in  t'jo 
absence  of  congressional  permission  to  do  so, 
the  state  had  no  power  to  interfere  by  seiz- 
ure." This  court  is  committed  to  the  doctrino 
that  the  size  or  form  of  the  package  has  very 
little  to  do  with  the  question  we  are  now  con- 
sidering. The  point  has  been  made  to  turn 
rather  upon  whether  the  liquors  themselves 
\^ere  imiiorted  or  not  than  upon  the  form  or 
inviolability  of  the  package.  Collins  v.  Hills, 
77  Iowa,  181,  41  X.  W.  .~>71:  State  v.  Coonan, 
siqira.  We  are  well  satisfied  with  the  con- 
clusions reached  by  the  lower  court,  and  the 
judgnieut  is  affirmed. 


150 


WHEN   TITLE   I'ASSES. 


GIBBS  V.  BENJAMIN. 

(45  Yt.   124.) 

Supreme  Court  of  Yeriuont.    Montpelier.    Nov., 
1872. 

*Book  account.  The  facts  reported  by  *12o 
tlie  auditor  sutticieiitl}'  apjiear  in  the  opin- 
ion of  the  court.  The  court  at  the  March  term, 
1871.  Rutland  county.  Wiikiolek,  J.,  presiding, 
rendered  judgment  on  the  report  for  the  i^iain 
tiff  for  the  price  of  the  wood  sued  for.  E.Kcep- 
tions  by  the  defendant. 

R    C.    Abell,    for   plaintiff.      Joseph    Potter 
and  Edgerton  &  Nicholson,  for  defe-idant. 

REDFIEr.D,  J  This  action  is  book  account 
to  recover  the  ])rice  of  cord  wood  alleged  by 
the  phiintiff  to  have  been  sold  the  defendant  in 
April,  1S69.  Jlost  of  the  wood  was  ])iled  on 
the  margin  of  Lake  Champlain.  on  plaintiff's 
farm,  in  Benson,  in  this  state.  Two  small  par- 
cels of  the  wood  were  on  the  opj^osite  shore  of 
the  lake.  About  a  week  after  the  negotiation 
(which  plaintiff  claims  was  a  sale),  the  wood 
was  carried  away  by  tne  tiood  of  the  lake,  and 
lost.  The  report  of  the  auditor  gives  a  ininute 
detail  of  every  incident  of  the  negotiation,  and 
submits  them  to  the  court  to  interpret  their  le- 
gal effect. 
*127  *The  parties  met  at  the  instance  of  the 
plaintiff,  and  inspected  the  wood;  after 
some  discussion,  it  was  agreed  that  the  defend- 
ant should  inirchase  the  wood  at  i?;^.r)0  per  cord, 
the  defendant  insisting  that  a  pi<rtion  of  it  was 
less  than  four  feet  in  length,  and  that  some 
abatement  should  be  made  for  such  deticieucy; 
to  which  the  plaiutiif  did  not  assent.  It  was  a 
part  of  the  agreement,  that  the  parties  should 
meet  and  measure  the  wood,  and  accordinLHy, 
on  theiythday  of  April.  18(59,  they  proceeded  to 
measure  the  several  piles  of  wood,  each  taking 
memoranda  of  the  measurement  as  it  pro- 
ceeded. The  defendant  measured  the  length 
and  still  claimed  some  abatement  therefor. 
The  plaintiff  insisted  that  by  the  terms  of  the 
agreement,  the  wood  was  to  be  assumed  to  be 
four  feet  in  length.  "As  it  was  getting  dark 
when  the  measurement  was  completed,  the 
parties  went  home,  each  with  the  figures  for 
having  a  computation  of  the  ciuantity  of  wood 
made  therefrom";  and  both  parties  expressed 
their  inability  to  make  the  computation  at  the 
time.  On  the2Istof  Ai)ril.  the  defendant,  with 
his  son,  went  to  the  plaintiff's  house,  to  see  if 
they  could  agree  about  the  quantity  of  wood 
that  had  been  ^measured.  The  plaintiff  had 
computed  theipiantity  of  wood  at  2i)4  cords  and 
some  feet;  "but,  by  mistake,  had  omitted  one 
pile,  containing  some  GO  cords."  The  defend- 
ant informed  the  plaintiff  that  he  made  the 
(|uantit3'  246  cords,  after  abating  live  inches 
for  deficiency  in  the  length  of  some  portion  of 
it,  and  proposed  to  the  plaintiff' tliat  he  would 
take  the  wiod  at  246  cords,  as  he  made  it,  or  at 
204  cords,  as  computed  by  the  plaintiff.  The 
plaintiff  replied  that  he  might  have  it  at  204 
cords,  and  the  defendant  agreed  to  take  it. 
After  tlie  defendant  left,  the  plaintiff'  discov- 
ered the  mistake,  and  immcsdiately  notified  the 
defendant  that  he  could  not  have  the  wood  at 
204  cords.  The  defen-^ant  sent  back  word  that 
he  would  again  meet  the  plaintiff',  and  did  so  in 
the  afternoon  of  the  same  da}'.  Plaintiff  de- 
clined to  let  defendant  have  the  wood  at  204 
cords,  but  consented  to  throw  off  5  inches  in 
length  from  two  piles.  Defendant  refused  to 
take  the  wood,  except  at  204  cords.  The  audi- 
tor has  stated  many  other  incidents;  but  this  is  a 
substantial  statement  of  the  facts,  as  detailed 


by   the   auditor.     It   is   not    claimed    that  the 
two  piles  of  wood  across  the  lake  were  de- 
*livered  to  the  defendant,  either  acluallv     *128 
or  constructively;  so  the   controversy   is 
confined  to  the  wood  situate    on  the  plaintiff's 
farm  in  Benson. 

[.  The  defendant  agreed  to  purchase  all  the 
wood  piled  on  the  plaintiff's  farm  on  the  mar- 
gin of  the  lake,  at  $3.50  per  cord;  and  if  this 
comj/rised  the  whole  case,  it  would  be,  in  the 
language  of  Lord  Brougham  in  the  case  of  Lo- 
gan V.  Le  Mesurier,  6  Moore  P.  C,  116  "Seliing 
an  ascertained  chattel  f(jr  an  ascertainable 
sum";  and  by  the  rule  of  law  applied  to  the  sail 
of  ponderous  and  bulky  articles,  such  as  wood, 
logs,  coal  and  the  like,  would  eft'ectually  pass 
the  property  to  the  vendee.  Hutchins  v.  Gil- 
christ, 23  Yt.  88;  Sanborn  v.  Kittredgc,  20  lb. 
639;  Birgeet  al.  v.  Edgerton,  28  Yt.  291.  But 
this  case  has  other  elements  which  impress  up- 
on it  quite  a  different  character.  It  was  part  of 
the  contract  that  the  parties  should  measure  tlie 
wood  and  ascertain  the  quantity.  They  met 
for  that  purpose,  and  disagreed;  and  that  disa- 
greement was  as  to  the  substsfnce  of  the  con- 
tract. The  plaintiff  insisted  that  it  was  agreed 
and  part  of  the  contract,  that  defendant  should 
take  the  wood  at  "running  measure";  the  de- 
fendant claimed  that  he  purchased  solid  cords; 
and  that  issue  grew  into  controversy,  but  was 
never  settled.  The  report  does  not  state  when 
the  price  was  to  be  paid;  but  in  the  absence  of 
any  special  agreement,  it  is  to  be  assumed  that 
it  was  to  be  paid  on  delivery. 

The  principle  is  well  settled,  and  uniform  in 
all  the  cases,  that  when  any  thing  remains  to 
be  done  bj'  either,  or  both,  parties,  precedent 
to  the  delivery,  the  title  does  not  pass.  And  so 
inflexible  is  the  rule  that,  when  the  property 
has  been  delivered,  if  an}'  thing  remains  to  be 
done  by  the  terms  of  the  contract,  before  the 
sale  is  complete,  the  propertv  still  remains  in 
the  vendor.  Parker  v.  Mitchell,  5  N.  H.  165; 
Ward  v.  Shaw,  7  Wend.  404.  The  contract 
must  be  executed,  to  effect  a  completed  sale, 
"and  nothing  further  to  be  done  to  ascertain 
the  quantity,  quality,  or  value,  of  the  property.  " 
Bennett,  J.,  in  Hutchins  v.  Gilchrist,  supra. 
"The  general  rule  in  relation  to  the  sale  of 
personal  property,  is,  that  if  any  thing  remains 
to  be  done  by  the  seller  before  delivery,  no 
property  passes  to  the  vendee,  even  as  between 
the  parties."  Pol.\nd,  J.,  in  Hale  v. 
Huntley  et  al.  21  Yt.  147;  Chit.  *Con.  396.  *129 
This  rule  of  law  ap])lied  to  the  facts  as  re- 
ported in  this  case,  retains  the  property  in  the 
wood  in  the  plaintiff',  and  leaves  the  contract 
e.xecutory,  and,  as  a  sale,  incomi)lete.  The  case 
of  Simmons  v.  Swift,  5  B.  &  C.  857,  is  much  like 
this,  but  much  stronger  in  its  facts.  It  was  an 
action  for  the  price  of  a  stack  of  bark  sold  at 
£9  5s.  per  ton.  After  the  sale,  it  was  agreed 
between  the  parties  that  the  bark  should  be 
weighed  by  two  persons,  each  parly  to  name 
one.  Part  of  the  bark  was  weighed  and  de- 
livered, the  residue  was  much  injured  by  a 
flood,  before  it  was  delivered,  and  for  that  rea- 
son, the  buyer  refused  to  take  it.  The  court  held 
that  the  bark  was  to  be  weighed  before  deliv- 
ery, to  ascertain  the  price;  and  as  that  act  had 
not  been  done,  the  property  remained  in  the 
seller,  and  that  he  must  bear  the  loss.  This 
was  not  a  case  where  a  portion  was  sold  to  be 
measured  or  weighed  from  the  bulk,  which 
woidd  have  no  identity  until  severed  and  set 
apart;  but  the  whole  stack  was  sold,  and  a  por- 
tion weighed  and  delivered.  The  subject  of 
the  sale  was  "ascertained"  and  the  price  "as- 
certainable;" 3'et  the  weighing  was  a  thing  to 
be  done  before  the  property  passed  to  tho 
purchaser. 


WHEN   TITLE  PASSES. 


151 


Incase  of  the  insolvency  of  the  defendant, 
it  could  hardly  he  chiiined  that  the  wood  be- 
came part  of  his  assets.  Or  if  attached  by  his 
creditor,  such  creditor  could  hardly  show  a 
color  of  rii,^ht.  as  a^^ainst  the  plaiiitill'. 

The  plaintiff's  counsel  seem  much  to  rely  on 
the  case  of  Gilmour  v,  Su|)ple,  11  ^loore  P.  C, 
5")1.  reported  in  7  Am.  Law  He<r.  (old  series), 
240.  Jn  that  case,  the  plaintiff  sold  a  raft  of 
lumber  for  a  fixed  price  per  foot,  with  specifica- 
tion of  the  measurement  of  each  loir,  made  by 
a  public  othcer  appointed  for  that  jiurpose  un- 
der the  law  of  Canada,  amounting  in  the  agi^ra- 
gate  to  71,4-i3  feet,  "to  be  delivered  at  Indian 
("ove  booms.  "  The  seller  conveved  the  raft  to 
the  place  of  deliver}',  made  it  fast  to  the  booms, 
and  nolitied  the  servant  of  the  jjurchaser  of  the 
delivery,  who  took  possession  of  the  same. 
The  judge  charged  the  jury,  that  "if  there  was 
an  actual  delivi  ry  at  the  place,  into  the  posses- 
sion of  defendant's  servants,  the  plaintiff' was 
entitled  to  recover."  The  jury  found  for  the 
plaintiff'.  3Ir.  Justice  Cressweli.,  in  delivering 
the  judgment,  reviews,  approvingly,  the 
*130  English  cases  of  *Hanson  v.  Jlever.  6 
East.  (il4.  Rugg  v.  Minett,  11  lb.  210.  and 
Wallace  v.  Breeds,  18  lb.  522.  and  Simmons  v. 
Swift,  ut  supra,  and  says:  "If  it  appears  that 
the  seller  is  to  do  something  to  the  goods  sold 
on  his  own  behalf,  or  if  an  act  remains  to  be 
done  by,  or  on  behalf  of,  both  parties,  before 
the  goods  are  delivered,  the  property  is  not 
changed."  The  learned  judge  then  proceeds  to 
show  that  the  rule  of  law,  well  established  by 
these  cases,  had  no  application  to  that  case,  and 
in  conclusion  says:  "There  was,  therefore,  noth- 
ing to  be  done  by  the  seller  on  his  own  behalf; 
he  had  ascertained  the  whole  price  of  the  raft 
by  the  measurement  previously  made;  he  had' 
conveyed  the  raft  to  Indian  Cove,  and,  accord- 
ing to  the  finding  of  the  jury,  had  delivered  it 
there.  Nor  was  there  anythinir  further  to  be 
done,  in  which  both  were  to  concur,  as  in  Sim- 
mons V.Swift."  The  plaintiff  recovered  be- 
cause the  sale  was  completed  by  delivery,  and 
nothing  further  remained  to  be  done. 

II.  ^Ve  think  this  case  within  the  statute  of 
frauds.  Our  statute  is  a  substantial  re-enact- 
ment of  the  29  Charles  II.,  and  has  received  the 


same  construction  given  to  the  P^nglish  statute. 
Spencer  v.  Hale,  HO  Vt.  314,  was  a  "book  action 
for  the  price  of  a  (piantity  of  fence  posts,  in- 
spected and  purchased  by  defendant,  to  be  de- 
livered on  the  car.s  at  Shaftsbury.  The  i)laintiff 
delivered  the  jioslson  the  cars  furnished  by  de- 
fendant, at  Sliaftsbury,  and  they  were  conveyed 
to  the  defendant's  residence  in  New  York. 
The  defendant  claimed  that  he  never  "accept- 
ed" them.  The  case  turned  upon  the  effect  of 
the  statute  of  frauds.  Chief  Justice  Hkdkield 
delivered  the  ojjiuion  of  the  court,  holding  tliat 
the  reception  of  the  posts  on  board  the  cars 
furnished  by  the  purchaser,  and  the  forwarding 
of  them  by  the  station  man,  who.  for  that  pur- 
pose, was  his  agent,  was  an  accc  nance;  and 
in  delining  the  rule  for  compliance  with  tlie 
statute  of  frauds,  says:  "It  is  undoubtedly  true 
that  the  defendant,  at  the  time  and  i)l:i(e.  had 
a  right  to  rejjudiate  the  posts  after  delivery. 
In  other  words,  in  order  to  ])erfect  the  case  un- 
der the  statute  of  frauds,  something  more  is 
necessary  than  a  mere  delivery  of  the  goods. 
In  the  language  of  the  statute,  the  purcliaser 
must- 'accept  and  receive  part  of  the  goods.'" 
Authorities  migiit  readily  be  multii)Iied. 
affirming  the  *rule  in  substantially  the  *131 
same  language;  but  we  recur  to  it  as  of  ac- 
knowledged authority  in  our  own  courts.  If 
we  could  hold  in  this  case— considering  the  nat 
ure  of  the  property  sold— that  there  was  a  con- 
structive delivery;  yet,  under  the  statute  of 
frauds,  "the  purchaser  had  the  right,  at  the 
time  and  place,  to  repudiate  the  wood  after  de 
livery.  "  And  the  auditor  finds,  distinctly,  that 
the  defendant,  wh,ile  the  measurement  was  be- 
ing done  (an  act  provided  for  by  the  contract 
of  sale),  refused  to  take  the  wood  upon  the 
terms  and  conditions  prescribed  b}'  the  ])  ain- 
tiff;  and  the  plaintiff,  as  distinctly,  refused  to 
let  him  have  the  wood  upon  the  terms  e\:ut'?d 
by  the  defendant.  It  is  not  important  which 
party  was  in  the  wrong.  It  is  enough  that  the 
purchaser  refused  to  "accept"  tic  wood,  to 
render  the  sale  invalid  under  the  statute  of 
frauds. 

The  judgment,  therefore,  of  the  county  court 
is  reversetl  and  judgment  on  the  report  for  the 
defendant  to  recover  his  costs. 


152 


WHEN  TITLE  PASSES. 


PIERCE  ct  al.  V.  COOLEY  ct  al. 
{•23  X.  W.  310,  5G  Mich.  5.52.) 
Supreme  Court  of  Michigan.     April  29,  1885. 
Error  to  circuit  court,  lugbam  county. 
Clarence   Cole,    for  plaintiffs.     Cabill,    Os- 
trauder  &  Baird,  for  defendants. 

CAMPBELL,  .J.  This  suit  was  brought  to 
recover  tlie  price  of  a  spoke-dressing  ma- 
chine, wliich  plaintiffs  claim  was  purchased 
by  defendants,  but  which  they  claim  they 
held  merely  on  trial,  when  it  was  accidental- 
ly destroyed  l\v  lire.  The  machine  had  been 
in  their  wagon-shop  in  Lansing,  and  par- 
tially tried,  prior  to  December,  1883,  but  had 
not  worked  well.  Plaintiff"  wished  them  to 
give  it  a  further  trial  with  a  different  meth- 
od of  gearing,  which  would  make  it  worli 
better.  A  Avritten  instrument  was  signed 
by  both  parties,  whereby  defendants  agreed 
to  take  it  if  it  worked  to  their  satisfaction, 
and  to  pay  for  it  by  note  due  May  1,  1884, 
or  by  cash  payment  on  that  day;  .and  the 
plaintiff  agreed  to  come  over  when  notilied 
that  the  machinery  was  ready  for  running. 
When  the  contract  was  made  the  work  of 
the  shop  was  suspended  for  a  change  of 
engine  and  machinery.  The  engine  was 
soon   set  running  again,   but   no   rearrange- 


ment of  the  gearing  for  the  spoke-machine 
was  made  until  just  before  the  tire,  which 
was  April  22,  1884.  This  delay  was  for  con- 
venience of  the  general  business. 

The  court  below  held  that  defendants 
Avere  bound  to  try  the  machine  within  a  rea- 
sonable time,  and  that  they  were  liable  to 
have  it  treated  as  accepted  if  they  did  not 
do  so,  and  it  was  left  to  the  jury  to  say 
whether  they  had  done  so.  We  think  this 
was  error.  The  contract  Avas  not  to  accept 
the  machine  if  it  worked  well,  but  to  ac- 
cept it  if  it  worked  to  defendants'  satisfac- 
tion. The  J*  could  reject  it  at  any  time  if  it 
did  not  please  them,  whether  good  or  bad. 
Machine  Co.  v.  Smith,  50  Mich.  5G5,  15  N. 
W.  1)06.  This  option,  we  think,  continued 
until  May  1,  1884,  when  they  undoubtedly 
were  bound  to  decide.  The  declaration  in 
the  special  count  was  framed  on  this  theory, 
and  we  think  it  plainly  the  con-ect  one.  The 
title  could  not  pass  without  acceptance  until 
tlie  time  of  choice  was  over,  and  the  plaintiff 
was  owner  of  the  machine  when  burned, 
and  not  the  defendants. 

The  judgment  must  be  reversed  and  a 
new  trial  granted. 

SHERWOOD  and  CHAMPLIX.  .JJ.,  con- 
curred.    COOLEY,  C.  J.,  did  not  sit. 


WHEN  TITLE  PASSES. 


]o:5 


WOOD  REAPING  &  MOWING  MACH.  CO. 
V.  SMITH. 

(1.5  N.  W.  900,  50  Mich.  5G5.) 

Supreme  Court  of  Michigan.     Juno  6,  1SS.3. 

Error  to  circuit  court,  Jaclcsou  couuty. 

G.  T.  Gridley  and  Thos.  A.  Wilson,  for  ap- 
pellant. Ilanmioud,  Barkwortb  &  Smith, 
for  appellee. 

GRAVP^S,  C.  .1.  This  action  was  brought 
originally  before  a  justice  of  tlie  peace.  The 
pleadings  were  put  in  orally.  The  declara- 
tion was  stated  as  being  "on  all  the  common 
counts  in  assumpsit,  and  on  a  written  con- 
tract by  which  defendant  agreed  to  buy  and 
receive  from  plaintiff  a  certain  agricultural 
machine  for  the  sum  of  three  hundred  dol- 
lars; claim,  $300  or  under  damages."  The 
defendant  stated  that  he  "pleaded  the  gen- 
eral issue,  and  gave  notice  of  proof  that  the 
macliine  did  not  answer  the  requirements 
of  the  contract." 

Tlie  mention  of  a  written  contract  referred 
to  three  simultaneous  writings:  First,  a  pa- 
per in  tlie  form  of  an  order  by  the  defend- 
ant on  the  plaintiff,  and  which  was  obtained 
from  the  defendant  by  Mr.  Price,  the  plain- 
tiff's soliciting  agent,  after  considerable  ef- 
fort; second,  a  paper  called  a  warranty,  de- 
livered by  the  agent  at  the  same  time  to 
the  defendant;  and,  third,  a  special  written 
stipulation  exacted  by  the  defendant,  and 
given  on  the  same  occasion.  These  papers, 
except  the  last,  were  printed  blanks.  There 
was  originally  between  the  word  "allowed" 
and  the  word  "days,"  in  the  second  paper, 
the  figure  one;  btit  at  the  time  the  papers 
were  exchanged  and  the  terms  arranged  tliJs 
was  stricken  out,  and  it  subseiiuently  be- 
came a  question  whether  anytliing  was  in- 
serted in  its  place.  This  subject  will  be 
again  noticed  further  on.  The  several  writ- 
ings appear  below. i 

1  (1)  Order  for  Walter  A.  Wood's  Self-bind- 
ing Harvester.  AValter  A.  Wood  Mowing  iS: 
Reaping  ^Machine  Company,  No.  80  Taylor 
street,  Chicago,  Illinois.  I  hereby  order  one  of 
Walter  A.  Wood's  Twine  (specify  whether  for 
twine  or  wire)  Solf-liinding  Harvesters,  five 
I'eet  six  inches  cut,  to  be  delivered  at  mv  farm 
on  or  liefore  .Tuly  1.  1880.  care  of  .7.  D."  Price, 
for  wliicli  I  agree  to  pay  you  or  your  agent  the 
sum  of  Ij^oOO,  in  manner  as  follows:  and  to  exe- 
cute notes  for  .$100,  p.avable  on  the  first  dav  of 
Octolier,  ISSO;  $100.  payable  on  the  first 'dav 
of  October  1881:  $100.  payable  on  the  first 
day  of  Octolier,  1882.  with  inter<'st  at  the  rate 
of  7  per  cent,  per  annum  from  .Inly  15,  1880; 
proviiled  the  machine  fidfills  your  printed  war- 
ranty, a  copy  of  which  I  have  this  day  receiv- 
ed. Robert  E.  Smith.  Purchaser. 

Takcni  by  .J.  D.  Price,  Agent. 

Post-office,   Brooklyn. 

Dated  .Tune  7,  1880. 

A  discomit  of  5  per  cent,  is  to  be  allowed  on 
all  cash  paid  before  October  1,  1880,  and  no  in- 
terest charged  on  such  payments. 

(2)         [Remove  this  warranty  and  give  it  to  the 

parchaser.] 

WARRANTY. 

The  Walter  A.  Wood  Self-binding  Harvester, 

five  feet  six  inches  cut,  for  which  R.  E.  Smith, 


The  justice  rendered  judgment  for  the 
plaintiff  for  damages,  $104.30,  besides  costs, 
and  the  defendant  appealed.  In  the  circuit 
court  the  cause  was  tried  before  a  jury  on 
the  same  i)leadings  and  a  verdict  entered 
for  the  plaintiff  in  the  .sum  of  $3lX».  This 
was  on  the  twenty-first  of  June,  1881.  The 
defendant  objects  to  several  rulings  of  the 
circuit  judge.  It  appears  from  the  case  that 
about  the  tirst  of  July,  1880,  the  plaintiff, 
by  its  agents,  produced  a  machine  at  the 
defendant's  farm,  and  that  Laverty  and  Jen- 
kins then  set  it  up.  The  time  for  cutting 
had  not  yet  arrived.  It  appears  also  that 
these  men  were  skilk'd  nuichinists  and  ex- 
perts in  putting  together,  hxing.  and  running 
these  implements,  and  were  in  the  plaintiff's 
general  employment  to  start  new-sold  ma- 
chines, make  them  work  as  required  bj'  the 
terms  of  sale,  instruct  buyers  how  to  use 
them;  and  generally  to  look  after  the  opera- 
tion of  the  machines  during  any  permitted 
time  of  trial.  Price,  the  soliciting  or  selling 
agent,  kept  his  agency  at  Jackson,  and  the 
place  of  the  defendant  was  in  the  township 
of  Columbia,  in  Jackson  coiinty,  and  his  post- 
office  was  at  Brooklyn,  in  the  same  town- 
ship. These  places  were  several  miles  dis- 
tant from  Jackson. 

In  the  afternoon  of  the  fifth  of  July,  being 
Monday,  Laverty  took  the  machine  to  the 
field  and  Avent  round  three  times  with  It. 
and  continued  on  the  forenoon  of  the  next 
day.  the  Otli,  until  about  11  o'clock,  and  then 
went  away.  On  the  succeeding  afternoon, 
namely,  the  7th,  .lenkins  came  and  took  Lav- 
erty's  i)lace,  and  according  to  defendant's 
testimony,  whicli  is  not  opposed,  continued 
"oft"  and  on  three  or  four  days"  in  handling 
and  fixing  the  machine  and  trviug  to  make  it 
work  properly.  And,  according  to  Price's 
testimony,  Jenkins  reported  to  him  that  he 
fotind  the  machine  out  of  order  and  not  do- 
ing good  work,  and  that  he  put  it  in  onler, 
but  thouglit  it  could  not  stay  so  becausi'  it 
was  in  the  hands  of  luiskillful  people. 


of  Columbia,  has  this  seventh  day  of  June. 
1880.  given  his  order,  is  subject  to  the  follow- 
ing warranty:  This  machine  is  warranted  to 
be  well  unide.  of  good  materials,  and  with  prop- 
er management  capable  of  cutting  and  binding 
in  a  workmanlike  manner,  doing  the  binding 
at   least   as   well   as   is   usually   done   by   hanil. 

The    purchaser    shall    be    allowed —    days' 

use  to  give  the  machine  a  fair  trial,  and  if  it 
should  not  work  well  immediate  notice  must  be 
given  to  the  agent  from  wIkuu  it  was  purchas- 
ed, and  reasonable  time  allowed  to  get  to  it 
and  remedy  the  defects,  if  any,  (the  i)urchaser 
rendering  necessary  and  friendly  assistance,) 
when,  if  it  cannot  be  made  to  do  good  wtu'k,  it 
shall  be  returned  to  the  i)lace  where  received 
free  of  charge,  and  the  pa.vments  of  mone.v  or 
notes  will  be  refunded.  I'ailure  to  give  notice 
as  al)ove  shall  be  deemed  conclusive  evidence 
that  the  machine  till.s  the  warranty,  whether 
it  is  kept  in  use  or  not. 

AValter  A.  Wood  Mowing  «S:  Reaping  Machine 
Co. 

(3)  It  is  expressly  agreed  and  understood  that 
this  contract  is  of  no  effect  unless  the  machine 
works  to  my  satisfaction. 


154 


WHEN   TITLE  PASSES. 


The  (lefeudant  jravo  evidonce  that  Jeukins 
-ju-kiiowledged  his  inability  to  make  the  ma- 
cliiue  operate  as  it  ought  to.  He  further 
gave  evideuco  that  he  seut  word  by  Jeukius 
to  Trice  of  the  miseonduct  of  the  machine, 
and  that  he  asked  .Jenkins  where  I'rice  Avas, 
and  was  answered  that  Price  Avould  be  there 
the  next  day:  that  I'rice  did  not  come,  how- 
ever, and  on  Saturday,  the  17th,  he,  the  de- 
fendant, wrote  him  that  the  twine-binder 
made  poor  work,  and  tliat  he  could  not  keep 
it.  This  note  was  postmarked  at  the  Brook- 
lyn ottice  on  Monday,  the  IDth.  and  on  the 
next  day.  but  before  the  letter  was  received, 
IM-ice  went  to  defendant's  and  a  controversy 
immediately    occurred   between    them. 

The  defendant  stated  that  it  was  tlie  bar- 
gain that  the  machine  was  to  be  satisfactory 
to  him,  and  that  he  was  to  have  the  whole 
of  harvest  time  to  test  it.  He  produced  the 
Avarranty  on  Price's  request,  and  the  latter 
then  claimed  that  it  fixed  the  time  of  trial 
at  two  days;  that  the  figure  "2"  was  in- 
serted over  the  erased  tigure  "1"  in  the  print- 
ed blank;  and  that  the  defendant,  having 
held  on  and  beyond  the  time  given,  he  was 
bound  to  keep  the  machine  and  pay  for  it 
according  to  the  written  terms.  The  de- 
fendant disputed  this  position,  and  insisted 
that  he  was  not  to  be  liable  imless  the  ma- 
chine was  satisfactory  to  him.  and  that  it 
Avas  orally  imderstood  that  he  sliould  liaA'e 
the  whole  period  of  harvest  to  satisfy  him- 
self, and,  moreover,  that  the  figure  "2"  Avas 
not  inserted  as  stated  by  Price.  The  notes 
mentioned  in  the  order  AA'ere  tendered  by 
Price  for  execution,  but  Smith  refused  to 
sign  them,  and  refused  to  have  the  machine. 
It  is  admitted  by  Price  that  his  motive  in 
putting  in  the  figure  "2"  over  the  erased 
figure  "1"  was  not  entirely  ingenuous.  He 
says  he  became  afraid  that  his  express  stip- 
ulation that  the  contract  should  be  of  no  ef- 
fect unless  the  machine  worked  to  Smith's 
satisfaction,  (and  Avithout  Avhich  stipulation 
it  was  impossible  to  get  the  order.)  AA'ould 
Avholly  displace  and  supersede  the  printed 
<;onditioual  AAarranty  unless  he  Avrote  some- 
thing in  it  at  the  very  time  which  woiild 
<,-hange  the  presumption;  and  so  he  made  the 
tigure  '•2"  over  the  figure  "1,"  and  then  read 
the  Avhole  to  the  defendant.  He  also  de- 
nied having  received  any  notice  of  defend- 
ant's dissatisfaction  prior  to  his  call  on  the 
tAA-enty-eighth  of  .July.  There  was  evidence, 
as  we  haA-e  seen,  tending  to  shoAV  that  the 
machine  performed  badly,  and  other  evi- 
dence that  it  Avorked  reasonably  Avell,  and 
that  the  defendant  acknoAvledged  to  third 
persons  that  he  Avas  satisfied  Avith  it,  or  to 
that  effect. 

The  questions  chiefly  material  are— First, 
the  character  of  the  defendant's  right  imder 
the  special  stipulation  as  to  rejecting  the  ma- 
chine; and.  second,  the  meaning  of  the  pro- 
vision requiring  immediate  notice  after  the 
term  of  trial.  The  circuit  judge  Avas  not 
able  to  say,  on  inspection,  Avhether  the  place 


mentioned  in  the  printed  AAarranty  actually 
contained  the  figure  "2"  as  claimed  by  Price 
or  not,  and  he  therefore  left  it  as  a  question 
of  fact  to  the  jury.  He  ruled.  hoAvever,  That 
in  case  they  found  that  the  figure  Avas  not 
there,  the  provision  Avould  then  necessarily 
imply  that  the  period  should  be  a  reasonable 
time,  and  he  added  such  hypothetical  instruc- 
tions as  he  Avas  of  opinion  the  circumstances 
called  for.  In  regard  to  the  defendant's 
right  to  reject  the  machine,  he  charged  sub- 
stantially that  unless  there  Avere  real  faults 
in  its  operation  for  Avhicli  the  defendant 
might  fairly  entertain  dissatisfaction  with  it, 
he  Avas  not  at  liberty  to  regard  himself  as 
not  .satisfied,  and  refuse  to  accept;  and  on 
the  other  hand.  eA'cu  in  case  i*eal  grounds  ex- 
isted for  dissatisfaction,  but  he  kept  the  ma- 
chine beyond  the  time  within  which  he  was 
to  give  notice  that  it  did  not  Avork  satisfac- 
torily to  him,  he  was  still  bound. 

The  cases  AA'here  the  parties  provide  that 
the  promisor  is  to  be  satisfied,  or  to  that 
effect,  are  of  two  classes;  and  Avhether  the 
particular  case  at  any  time  falls  Avithiu  the 
one  or  the  other,  must  depend  on  the  special 
circumstances,  and  the  question  must  be  one 
of  construction.  In  the  one  class  the  right 
of  decision  is  completely  reserved  to  the 
promisor,  and  without  being  liable  to  disclose 
reasons  or  account  for  his  course,  and  all 
right  to  inquire  into  the  grounds  of  his  action 
.and  oA'erhaul  his  determination  is  absolutely 
excluded  from  the  promisee,  and  from  all 
tribunals.  It  is  sufficient  for  the  result  that 
he  Avilled  it.  The  law  regards  the  parties  as 
competent  to  contract  in  that  manner,  and  if 
the  facts  are  sufficient  to  show  that  they 
did  so,  their  stipiUation  is  the  laAA*  of  the 
case.  The  promisee  is  excltided  from  set- 
ting up  any  claim  for  remuneration,  and  is 
likewi.se  debarred  from  qttestioning  the 
grounds  of  decision  on  the  part  of  the  prom- 
isor, or  the  fitness  or  propriety  of  the  deci- 
sion itself.  The  cases  of  this  class  are  gen- 
erally stTch  as  inAolve  the  feelings,  taste,  or 
sensibfiity  of  the  promisor,  and  not  those 
gross  considerations  of  operative  fitness  or 
mechanical  utility  Avhich  are  capalde  of  be- 
ing seen  and  appreciated  by  others. 

Btit  this  is  not  always  so.  It  sometimes 
hai)pens  that  the  right  is  fully  reserA'ed  AA'here 
It  is  the  chief  ground,  if  not  the  only  one, 
that  the  party  is  determined  to  preserve  an 
unqualified  option,  and  is  not  Avilling  to  leave 
his  freedom  of  choice  exjtosed  to  any  con- 
tention, or  subject  to  any  contingency.  He 
is  resolved  to  permit  no  right  in  any  one  else 
to  judge  for  him.  or  to  pass  on  the  Avisdom 
or  UHAvisdom.  the  justice  or  injustice,  of  his 
action.  Such  is  his  will.  He  Avill  not  enter 
into  any  bargain  except  upon  the  condition 
of  reserving  the  jiowor  to  do  Avhat  others 
might  regard  as  tmreasonable.  The  folloAV- 
ing  cases  sufficiently  illustrate  the  instances 
of  the  first  class.  Gibson  a-.  Cranage.  30 
Mich.  40;  Taylor  v.  Brewer.  1  Maule  &  S. 
290;     McCarren    v.    McNulty,    7    Gray,    139; 


WHEN   TITLE  TASkSES. 


11 


Brown  v.  Foster,  113  Mass.  13f!;  ZaU-ski  v. 
■Clark,  44  Couu.  "JIS;  Kossiter  v.  Cooper,  23 
Vt.  522;  Hart  v.  Hart.  22  Barb.  UdC;  Tyler 
V.  Ames,  G  Eans.  280. 

In  the  other  class  the  promisor  is  supposed 
to  undertake  that  be  will  act  reasonably  and 
fairly,  and  found  bis  determination  on 
grounds  which  are  just  and  sensil)le;  and 
from  thence  sprinjis  a  necessary  implication 
that  bis  decision,  in  point  of  correctness  and 
the  adt(]uacy  of  the  .^rounds  of  it.  are  op(>n 
cousideriitions,  and  subject  to  the  judgment 
of  judicial  triers.  Amonji  the  cases  applica- 
ble to  this  class  are  Dajifiett  v.  Johnson.  49 
yt.  345,  and  Manufacturing  Co.  v.  Brush,  43 
Yt.  528. 

To  which  of  these  classes  does  this  case 
belongV  The  answer  is  not  difficult.  The 
facts  are  very  distinct.  The  plaintiff's  own 
<>vidence  is  cogent  that  the  defendant  was 
extremely  shy,  and  would  enter  into  no  ar- 
rangement except  upon  the  terms  of  doing 
as  h(^  liked  about  keeping  the  machine  after 
testing  it.  His  mind  was  fixed  immoval)ly 
:hat  no  chance  should  be  left  to  force  the 
article  upon  him  unless  he  finally  chose  to 
take  it,  and  the  special  stipulation  was  spe- 
<-ifically  drawn  and  executed  to  meet  this 
purpose  and  thereby  induce  the  defendant  to 
concur  in  an  arrangement.  Had  it  been  the 
intention  that  he  should  be  liable  in  case  the 
performance  of  the  machine  were  such,  in 
the  opinion  of  a  jury,  as  to  deserve  his  ap- 
proval, it  would  have  been  quite  unnecessarj' 
to  get  up  the  special  writing.  The  original 
printed  warranty  would  have  answered  the 
jmrpose.  The  transaction  Avas  one  belong- 
ing to  the  first  class,  and  the  circuit  judge 
Avas  mistaken  in  deeming  it  otherwise. 

The  question  concerning  notice  is  now  in 
order.  The  circuit  judge  very  properly  in- 
formed the  jury  that  the  defendant  was  not 
at  all  answerable  for  the  space  of  time  dur- 
ing which  the  plaintiffs  agents  occupied 
themselves  in  trying  to  make  the  machine 
work  well,  and  that  the  time  chargeable  to 
him  only  began  when  they  quit,  and  from 
thence  ran  on,  whether  he  was  in  fact  enti- 
tled to  a  reasonable  time  thereafter,  or  to 
only  two  days.  But  he  further  stated  that 
the  defendant  was  bound  to  see  that  Price 
had  actual  notice,  if  such  was  the  case,  that 
the  machine  did  not  work  to  his  satisfaction; 
and,  further,  that  he  was  boiuid  to  see  that 
Price  had  this  notice  within  two  days  after 
the  agents  quit,  in  case  the  figure  "2"  was  in 
the  printed  warranty,  or,  if  it  was  not  in, 
then  within  a  reasonable  time  after  that 
event.  This  instruction  was  not  proper  on 
any  theory.  It  held  that,  in  case  the  figure 
"2"  was  in  the  warranty,  the  defendant  was 


bound,  not  only  to  conqilete  his  own  trial  of 
the  machine  during  the  first  interval  of  two 
days,  but  also  to  see  to  it  that  Price,  within 
the  .same  period,  had  actual  notice  that  it 
did  not  work  well,  if  such  was  the  result  of 
the  test.  Now,  it  is  very  obvious  that  more 
than  the  whole  two  days  may  have  been  nec- 
essary to  reach  Price  and  notify  him.  But 
this  is  not  all.  The  printed  warranty,  what- 
ever its  influence,  if  any,  here,  appropriated 
the  whole  of  this  period  to  the  business  of  a 
test  bj'  the  defendant,  and  postponed  the 
necessity  of  starting  to  give  notice  till  the 
expiration  of  it. 

It  may  be  expedient  to  add  .-i  word  in  this 
branch  of  the  controversy.  According  to  the 
terms,  as  we  have  seen,  of  the  printed  war- 
ranty, the  purchaser,  in  case  of  the  failure  of 
the  machine  to  work  well  during  the  si)ace 
allowed  for  trying  it,  must  give  immediale 
notice  to  the  selling  agent.  This  provision 
for  immediate  notice  does  not  mean  the 
shortest  time  possible  in  which  notice  could 
be  given.  The  terms  must  receive  a  sensible 
interpretation — an  interpretation  favorable  to 
the  general  object  and  consistent  witi?  the 
surrounding  conditions.  It  would  be  neces- 
sary to  make  allowance  for  the  engagements 
of  the  parties,  the  distance  between  them, 
the  facility  of  communication,  and  any  other 
incidents  having  a  bearing.  \o  greater  dis- 
patch would  be  implied  than  such  as  would 
be  fairly  just  and  reasonable  in  view  of  all 
the  circumstances.  Attwood  v.  Emery,  1  C. 
B.  (N.  S.)  110;  Staunton  v.  Wood.  ItJ  Q.  B. 
G.3S;  Roberts  v.  Brett,  11  H.  L.  Gas.  337; 
Toms  V.  AYilson,  4  Best  &  S.  442-445;  Mas- 
sey  V.  Sladen,  L.  li.  4  Exch.  13;  Tennant  v. 
Bell,  9  Q.  B.  GS4;  Spenceley  v.  Robinson,  3 
Barn.  &  C.  G58;  Thompson  v.  (iibson.  8  Mees. 
&  W.  281;   Waddell  v.  Reddick,  2  Ired.  424. 

Complaint  is  made  that  the  recovery  was 
excessive,  even  if  the  plaintilf  were  entitled 
to  prevail,  and  the  point  is  that  by  the  terms 
of  the  transaction  three  notes  were  fo  be 
given,  and  that  the  time  of  one  only  had  ex- 
pired when  the  suit  was  commenced.  It  is 
hardly  worth  while  to  go  into  that  question 
now.  From  the  pleadings  and  facts  in  the 
record,  it  is  not  easy  to  discover  the  theory 
on  which  the  case  proceeded;  but  hereafter 
the  real  ground  of  action  may  be  distinctly 
indicated.  The  measure  of  damages,  as  Avell 
as  the  course  of  proof,  would  be  alfected  by 
the  form  of  claim  asserted  on  the  transac- 
tion. Benj.  Sales  (1st  Am.  Ed.)  §  Ttj5.  and 
notes. 

The  other  'points  are  of  no  importance. 
The  judgment  must  be  reversed,  with  costs, 
and  a  new  trial  granted. 

The  other  justices  concurred. 


15li 


WHEN  TITLE  PASSES. 


PLATT  V.  BRODERICK. 

(08  X.  W.  579,  70  Midi.  577.) 
SuprcMiie  Court  of  Michigan.    June  8,  1888. 

Error  to  circuit  court,  Berrien  county;  An- 
dreAV  J.  Siuitli.  .Judjie. 

Assumpsit  by  CJeorfjo  W.  Piatt,  assignee  of 
the  Waiter  A.  Wood  :Mo\vinj,'  &  Reapiug  Ma- 
chine Company,  asain.st  Edward  Brcxlerick.  for 
the  price  and  value  of  a  mowiiig-macliine. 
This  action  was  brouglit  in  a  justice's  court, 
wliere  the  defendant  liad  judgment  for  costs. 
Tlie  plaintiff  ajjpealed  to  the  circuit  court, 
where  he  recovered  judgment  for  ij^iij  before  a 
jury.     Defendant  assigns  error. 


MORSE,  J.  The  plaintiff  declared  against 
the  defendant  in  justice's  court  for  the  price 
and  value  of  a  mowing-machine.  !f(>5.  sold  by 
him,  as  agent  of  the  Walter  A.  Wood  Mowing 
&  Reaping  Machine  Company,  to  said  defend- 
ant, which  said  claim  or  account  of  .$<>j  wa.s 
assigned  by  said  machine  company  to  him  be- 
fore the  commencement  of  this  suit.  The  de- 
fendant had  judgment  in  the  justice's  court  for 
costs.  The  plaintiffi  appealed  to  the  circuit 
court  for  the  county  of  Berrien,  in  which  court, 
before  a  jury,  tlie  plaintilt  recoveretl  judgment 
for  $65.  The  plaintiff  claimed,  upon  the  trial, 
that  the  machine  was  sold  to  the  defendant 
in  the  sununer  of  1886.  The  terms  of  sale 
were  agreed  upon  on  a  certain  Saturday  in 
the  month  of  .Inly.  Broderick  w-as  to  take 
the  machine  heme  that  day.  An  agent  of  the 
machine  company,  one  Kuearl,  was  to  go  out 
to  Broderick's  place  on  the  following  Mon- 
day, and  set  the  machine  up,  and  stay  until 
it  -worked  satisfactorily.  If  it  did  not  suit 
the  defendant,  he  was  to  bring  it  back  Mon- 
day, and  receive  pay  for  brmging  it  in.  If  it 
worked  all  right  to  his  satisfaction,  Broderick 
was  to  keep  the  machine,  and  pay  .$65  for  it, — 
one-half  October,  1S8().  and  the  balance  Octo- 
ber, 1887,  with  interest  from  October,  1886. 
Under  this  arrangement,  defendant  took  the 
machine  home  with  him  Monday  morning. 
Kneaii  testifies  he  went  out  to  Broderick's 
farm  to  fulfill  his  part  of  the  agreement.  He 
found  that  defendant  had  set  up  the  machine, 
and  was  at  work  with  it.  He  made  some 
changes  in  the  setting  of  the  machine.  It  was 
tried  in  all  kinds  of  grass  growing  on  defend- 
ant's place,  and  worked  well.  Knearl  stayed 
about  three  hours,  when  Broderick  told  him  he 
"liked  the  machine  first  rate,"  and  he  need  not 
stay  any  longer.  He  then  Avent  back  to  town. 
A  few  days  after,  the  defendant  brought  the 
machine  back.  The  plaintiff  refused  to  re- 
ceive it,  and  defendant  ludoaded  it  in  the  yard 
of  Mrs.  Downey,  about  20  feet  from  plaintiff's 
premises.  The  defendant's  version  of  the 
transaction  was  that  the  price  of  the  machine 
was  agreed  upon  at  .fOO,  with  a  year's  time, 
without  interest.  If  the  machine  suited  him, 
he  was  to  take  it  out  to  his  farm,  and  try  it 
until  he  was  satisfied.  There  was  no  time 
mentioned  when  he  should  bring  it  back  if  he 
did  not  like  it;    nor  was  there  any  limit  as  to 


time  of  trial.  Did  not  tell  Knearl  that  he  was 
.satisfied  with  the  machine,  or  anything  of  the 
kind.  The  machine  did  not  do  good  work. 
Did  not  suit  him,  and  he  returned  it  on  Thurs- 
day. Did  not  use  it  except  on  Monday,  when 
he  mowed  about  three  acres.  The  testimony 
shows  that  some  time  in  October,  18S6,  the 
l)laintiff  demanded  of  the  defendant  a  settle- 
ment for  the  machine  and  notes,  in  accordance 
with  the  terms  of  the  agreement;  it  being  his 
custom  to  take  notes  when  time  was  given. 
Demanded  notes  several  times  afterwards,  but 
defendant  always  refused  to  give  them,  or  pay 
for  file  machine.  The  circuit  judge  instructed 
the  jury  that  in  setting  up  the  m.-ichine  on 
IMonday,  before  Mr.  Knearl  arrived  at  his 
place,  the  defendant  violated  the  contract  of 
sale,  and  was  bound  to  take  the  machine,  and 
must  pay  for  it;  and  that  the  only  question 
to  be  determined  by  the  jury  was  tlie  price  of 
the  machine,— whether  it  was  .$65,  as  claimed 
by  the  i)laiutiff,  or  .$60,  as  contended  by  the 
defendant. 

This  iustructiori  was  erroneous.  It  does  not 
appear  that  the  setting  up  of  the  machine  by 
the  defendant  had  anytliing  to  do  with  the 
working  of  the  same,  or  that  any  complaint 
was  made  by  the  plaintiff  or  Knearl  because 
of  such  setting  up  of  the  machinery  by  defend 
ant.  The  issue  was  a  simple  one.  If  the 
plaintiff's  theory  of  the  contract  was  correct, 
and  defendant,  after  using  the  machine  on 
Monday,  told  the  agent  he  was  satisfied  with 
it,  and  did  not  return  it  on  that  day,  the  plain- 
tiff was  entitled  to  recover  the  price  of  the 
machine.  If  the  defendant's  version  of  the 
contract  was  the  true  one,  the  plaintiff  could 
not  recover,  and  the  verdict  should  have  been 
for  the  defendant.  Under  the  agreement,  as 
testified  to  by  both  parties,  it  was  immaterial 
wl:ether  the  machine  worked  well  or  not.  The 
defendant  was  to  be  satisfied  with  it;  and,  if 
it  did  not  suit  him,  he  had  a  right  to  return  it, 
on  Monday  if  plaintiff's  theory  was  accepted, 
and  upon  the  day  it  was  returned  if  the  agree- 
ment was  as  claimed  by  Broderick.  Machine 
Co.  V.  Cochran,  31  N.  AV.  561;  Mamitacturing 
Co.  V.  Ellis,  .35  N.  W.  842;  Machine  Co.  v. 
Smith,  .50  Mich.  565,  15  N.  W.  906. 

One  other  objection  need  only  be  mentioned- 
It  was  not  competent  for  either  the  defendant 
or  Lawrence  to  testify  that  Knearl  stated  to 
Lawrence  what  the  bargain  was  between  him 
and  defendant.  If  Lawrence  was  present 
when  the  bargain  was  made,  he  could  testify 
to  what  was  said  between  the  parties,  in  re- 
buttal  of  Knearl's  te.stimony.  But  a  stiitement 
made  by  Knearl  after  the  contract  was  com- 
l)leted,  not  in  the  presence  of  plaintiff,  could 
not  be  received  in  evidence  except  in  impeach- 
ment of  Knearl's  testimony;  and,  in  such  case, 
Knearl's  attention  must  be  called  to  such  state- 
ment, which  was  not  done,  as  appears  by  the 
record.  The  judgment  will  be  reversed,  and 
a  new  trial  granted. 

SHERWOOD,  C.  .1.,  and  CHAMPLIX  and 
CAMPBELL,  .TJ.,  concurred.  LOXG.  J.,  did 
not  sit. 


WHEN   TITLE  I'ASSES. 


1^ 


UNITED  STATES  ELECTRIC  FIRE- 

ALAK.M  CO.  V.  CITY  OF  BIG 

RAPIDS. 

(4.3  X.  W.  1030.  78  Micb.  07.) 

"Suprpuie   Court   of   Midiigan.     Nov.   15,    1S89. 

Appoal  from  circuit  court,  Mecost:i  county. 

Action  of  assumpsit  brought  by  tiie  Unit-  I 
€d  States  Electric  Fire-Alaim  Company  of  | 
Evart,  Midi.,  against  the  city  of  Big  Itapids, 
to  recover  the  price  of  an  electric  lire-al.irm, 
put  lip  by  the  plaintiff  for  the  (iefendant  un- 
der contract.  Juiigment  for  deleiulant,  and 
phiintiff  appeals. 

M.  Brown  and   Austin  Herrick,  for   ap- 
pellant.    Frank  Damon,  for  appellee.  i 

CHAMPLIX,  J.  This  cause  was  tried 
before  the  court  without  a  jury,  who,  on  re- 
quest of  the  jiaities,  made  a  tiniling  of  fa  ts 
and  law,  from  which  it  appears  that  the  city 
■of  Big  Rapids  has  a  volunteer  fire  depart- 
ment, consisting  of  six  fire  companies,  l\\e 
liose  companies,  and  one  hook  and  ladder 
company,  and  the  firemen  who  compose  the  j 
various  comiKluies  reside  within  a  raJius  of 
thre  -fourths  of  a  mile  from  the  coun-house 
in  sail  city.  On  the  Gth  day  of  June.  18:^7, 
the  common  council  of  the  city  of  Big  Rapiiis 
appointed  acommittee  of  five  members  of  the 
council  to  consider  the  various  propositions 
for  a  fire-^darm  submitted  to  it,  and  tiiose 
which  should  be  submitted  to  them  there- 
after. On  the  24th  day  of  June,  1887,  the 
L'nited  States  Electric  Fire-Alarra  Comjiany 
of  Evart,  Mich.,  submitted  to  said  cummitlee 
the  following  proposition  in  writing:  "Office 
of  United  States  Electric  Fire-Alarm  Co.  of 
Evart,  Michigan,  June  24th,  18>7.  Alder- 
man Comstock,  Chairman  Fire-Alarra  Com- 
mittee, Big  Rafiids,  Mich. — Dear  Sir:  Tn 
case  it  is  decided  to  use  the  court-house  tower 
instead  of  building  a  bell  tower,  we  will  fur- 
nish the  following  proposition  to  erect  a  large 
fire-alarm  bell,  tower  bell  striker,  alarm  cir- 
cuit, etc.,  as  follows:  One  3,000-poun(l  bell 
and  liangers,  one  medium  sized  tower  bell 
striker  for  electrically  striking  the  alarm  and 
location  of  fires  on  the  bell,  and  to  be  operat- 
ed and  controlled  from  the  water-worlds  pump 
house;  the  bell  and  striker  to  be  placed  in 
the  court-house  tower,  and  one  manual  re- 
peater located  at  the  water-worUs  pump  house 
for  automatically  operating  the  tower  bell 
striker,  and  ca'  able  of  repeating  the  number 
of  any  one  of  thirty  difierent  fire-alarm  box- 
es, as  may  be  desired,  together  with  all  the 
poles,  wires,  insulators,  brackets,  battery, 
etc.,  nec'ssary  for  constructing  line  and  elec- 
trical alarm  circuit,  connecting  repeater  at 
water-woiks  with  tower  beil  striker  in  the 
tower;  s;iid  j^oles  to  be  good  sound  cedar,  of 
sufficient  length  to  carry  the  line  over  all 
other  electrical  wires  now  erected;  the  line 
to  be  of  the  very  best  (juality  of  Xo.  12  gal- 
vanized telegraph  wire,  well  insulated  on 
good  glass  insulators,  secured  to  the  poles, 
and   all  joints    well    soldered;   also   all   the 


necessary  battery  and  minor  altacliments  for 
the  successful  operation  ol  the  same, — all  com- 
plete and  ready  for  service  for  the  sum  of 
$1,248.  It  being  indefinite  as  to  the  actual 
weight  of  a  bell,  although  intended  to  be  cast 
of  a  given  weight,  it  is  proposed  to  make  an 
add;tion  or  reduclion  in  the  price  given  at  the 
rate  of  lij|  cents  per  pound,  according  to  the 
variation  of  tiie  weight  of  the  bell  from  the 
proposed  weight.  The  company  agrees  to  do 
all  of  the  above  work,  and  complete  the  con- 
tract in  about  thirty  days  from  the  date  of 
signing  the  contract,  and  your  honorable 
bi)dy  shall  thoroughly  test  the  working  of  the 
same  within  thircy  days  after  the  cotnpletion 
of  said  work,  and  if  found  to  be  satisfactory, 
and  according  to  contract,  accept  and  pay  for 
same.  In  case  the  manual  repeater  is  left 
from  the  list  of  apparatus  and  a  signal  key 
used,  the  above  figures  will  be  reduced  to 
.Sl,liS.  It  is  further  proposed  that  in  case  a 
2.oUiJ-pound  bell  is  used  the  above  figures 
will  be  reduced  to.Sl.Uti3.  The  bell  foundry 
guaranty  all  bells,  and  we  guaranty  all  of 
our  machinery  as  to  perfection  of  operation, 
and  against  breakage  caused  by  fiaws  or  de- 
fects in  castings.  All  of  which  is  respect- 
fully submittid.  UxiJ  KD  States  ELKcruic 
FiKE- Alarm  Co.,  S.  A.  Chase,  Sec'y."  Al- 
derman Comstock,  one  of  the  committee, 
afterwards  i-e[iorted  to  a  meeting  of  the  com- 
mon council  on  July  5,  1887.  that  tiie  com- 
mittee had  neirotiated  for  a  fire-aiarra  with  a 
3,0u0-poi:nd  bell,  and  asked  the  council  to 
sltle  on  some  location  for  it  to  be  jil.ice<l. 
Such  report  was  received  and  the  committee 
(..-•ocharged,  and  the  following  record  Lheieof 
was  enter  '<i  upon  tlie  journal  of  the  common 
council,  to-wit:  •'Alderman  Comstock,  chair- 
man of  the  sjiecial  committee,  ajipointed  to 
purchas;e  a  fire-alarm,  rep"ited  that  tiiey  h.id 
negotiated  for  an  alarm  wiih  a  3,0U0-pound 
bell,  and  asked  the  council  to  settle  upon  a 
location  for  it  to  be  placed.  Report  accepted, 
and  committee  discharged." 

On  the  23d  of  July,  1887,  the  city  of  B.ig 
Rapids  entered  into  a  contract  in  writing 
wit'_i  tlie  plaintiff  in  tliis  suit,  which  said 
contract  was  signed  by  the  mayor  in  behalf 
of  the  city,  and  by  the  United  Sl:ates  Electric 
Fire-Alarm  Company,  by  S.  A.  Chase,  its 
secretary.  The  aforesaid  proposition  made 
by  the  United  States  I^lectric  Fire-Aia:m 
Company  was  attached  to  said  written  con- 
tract, and  became  and  was  a  part  thereof, 
and  in  addition  thereto  the  contract  con- 
tained the  following,  that  is  to  say:  "It  is 
hereby  agreed  between  the  city  of  Big  Rapids 
of  the  one  part,  and  the  United  States  Elec- 
tric Fire-Alarm  Comjiany  of  the  other  part, 
as  follows:  The  said  second  party  hereby 
agrees  to  put  in  a  fire-alarm  bell  in  court- 
house tower,  to  do  all  work  and  furnish  all 
material  and  things  used  in  connection 
therewith,  as  speciiied  in  specifications  here- 
to attached,  consisting  of  four  sheets;  and 
same  are  declared  to  be  and  are  a  part  of  this 
contract.  Said  s  cond  party  agrees  to  set 
poles   at   such   distance  apart  as  to  support 


158 


WHEN  TITLE  PASSES. 


wire  in  a  gooil  and  suljstantial  manner,  and 
to  set  Siiniu  ol'  sullicient  dej>th  to  fstaiul  in 
proper  manner;  poles  to  be  set  in  streets  and 
alley's  to  points  hereinafter  named  at  inter- 
section of  (irand  Traverse  and  Warren  av- 
enue, unless  permission  is  granted  to  set 
them  on  private  property,  or  to  cross  same 
with  wire.  One  pole  to  be  set  at  intersec- 
tion of  Grand  Traverse  street  with  Warren 
avenue;  thence  along  Warren  avenue  to 
Ik-mlock  stieet;  thence  along  Ilemldck  street 
to  River  street;  thence  along  liiver  street  to 
iMa{)le  stieet;  thence  across  j\Ia[)le  street  to 
alliv  between  [Stewart  and  Ives  avenue; 
tiience  s»utiierly  along  to  Elm  street;  thence 
to  court-liouse  tow^er.  All  work  to  be  done 
in  a  good  and  workman-like  manner,  and 
work  done  and  contract  to  be  perfoi'ined 
witliiu  forty  days  from  the  date  liereof.  The 
tone  of  bell  to  be  second  A  below  middle  C 
on  tlie  organ.  Said  lirst  party  to  liave  thirty 
days  after  contract  is  completed  to  test  bell 
and  working  apparatus,  and,  in  case  same  is 
satisfactory  as  per  contract,  then  they  agree 
to  j)ay  said  second  })arty  the  sum  of  twelve 
liundred  and  forty-eight  dollars  therefor,  or 
as  per  specilications  as  to  weight,  t'sic.  Said 
tirst  party  agrees  to  furnish  and  put  in  ceil- 
insr  and  lioor  in  tower."  In  pursuance  of 
said  contract  plaintiff  put  in  for  the  defend- 
ant a  fire-alarm,  including  a  bell  weighing 
3,20C)  pounds,  and  tiie  total  amount  of  the 
plaintiff's  demand  against  the  city  for  the 
Hre-alarm  system,  including  the  bell,  is  ."i?!,- 
294.99.  The  bell  was  put  in  the  court-house 
tower,  and  the  tone  of  the  bell  is  about  E 
fiat.  On  September  24,  1887,  plaintiff  noti- 
fied the  common  comcil  that  tlie  system  put 
in  by  it  was  complete,  and  requested  the 
council  to  fix  a  time  when  they  would  test 
the  same,  and  the  council  fixed  the  1st  day 
of  October,  1887,  at  9:30  o'clo  k  a.  m.,  as 
the  time  when  such  test  would  be  made. 
The  common  council  assemliled  accordingly 
for  the  purpose  of  testing  the  lire-alarm,  and 
the  plaintilf,  by  its  secretary,  S.  A.  Chase, 
made  a  thorough  test  of  the  working  of  said 
fire-alarm  system,  and  the  tone  and  volume 
of  sound  of  said  fire-alarm  bell  then  in  the 
court-house  tower.  The  members  of  the 
council  also  tested  the  tone  and  volume  of 
the  bell  from  the  different  Hre-alai'tn  boxes. 
Another  test  of  the  fire-alarm  was  afterwards 
made  in  the  nigiit-time,  by  turning  in  an 
alarm  from  one  of  the  boxes,  said  council  be- 
ing then  in  session  in  their  council  chamber, 
and  hstening  thereto.  A  still  further  test 
was  made  on  the9tli  of  October,  1887,  it  be- 
ing on  the  oce;isiou  of  a  fire  in  the  citv.  On 
the  lOth  of  October,  1887,  the  council  con- 
sidered the  question  wliether  the  said  fire- 
alarm  system  and  said  fire-alarm  bell  were 
satisfactory  to  said  common  council,  and 
whether  said  common  council  should  accept 
and  pay  for  the  same,  and  took  action  there- 
on, and  then  and  there  considered  that  said 
fire-alarm  system  and  bell  were  not  satisfac- 
tory to  said  common  council,  and  they  I'e- 
f  used  to  accept  the  same,  or  any  part  there- 


of, for  and  in  behalf  of  the  city,  and  tliey 
then  and  there  caused  a  record  of  their  deter- 
mination to  not  accept  the  same,  and  di- 
rected the  recorder  of  the  city  to  notify  the 
plaintiff  of  such  action.  TIih  recorder  sent 
to  the  j)laintitf  by  mail  the  notice  following: 
"IJig  Kapids,  October  13,  1887.  Electric 
Fire-x\.larm  Co.,  Evart,  Mich. — Gentlemen: 
At  a  meeting  of  the  common  council  last 
Monday  night  they  rejected  the  fire-alarm 
bell  as  not  satisfactory.  Yours,  etc.,  S.  A. 
Stambaugii,  Recorder."  The  notice  was  re- 
ceived by  the  secretaiy  of  the  company  on 
the  15th  of  O.  tober,  1887,  at  Evart,  Mich. 
During  the  sauie  month  the  common  council 
adopted  the  following  resolution:  "Whereas, 
the  city  of  Big  Kapids  has  made  a  contract 
witli  the  Electric  Fire-Alarm  Comi)any  of 
Evart,  Michigan,  the  condition  of  such  con- 
tract being  that  said  fire-alarm  company  fur- 
nish a  bell  weighing  3,000  pounds,  and  all 
apparatus  for  striking  the  same,  material  and 
work  to  be  satisfactory  to  the  city:  therefore, 
resolved  by  the  common  council  of  tlie  city 
of  Big  liapids  that  the  tests  of  the  same  have 
not  been  satisfactory;  and  it  is  further  re- 
solved that  we  do  not  aceept  the  same,  as  it 
is  not  satisfactory  according  to  contract."" 
The  common  council  of  the  city  has  never  in 
fact  accepted  said  fire-alarm  system,  and  said 
fire-alarm  bell  winch  is  a  part  thereof,  and 
the  city  lias  not  used  the  same  for  any  pur- 
pose whatever. 

The  fite-alarm  bell  is  not  suitable  for  the 
purpose  of  a  fire-alarm  for  the  reason  that 
its  tone  and  volume  of  sound  is  such  that 
said  bell  cannot  be  lieard  easily  by  the  fir;> 
.ueu  wnen  within  their  houses  or  places  of 
business,  or  when  engaged  in  anythinnf  de- 
manding th  ii-  attention  in  any  iiart  of  the 
city.  The  court  further  found  that  the  bell 
put  up  by  the  plaintiff  was  the  exact  kind  of 
a  bell  contracted  for  by  the  defendant,  ex- 
cept as  to  the  tone  thereof;  that  the  fire- 
alarm  system  furnished  by  the  plaintiff  foi 
the  defendant,  and  all  work  done  by  it  in 
putting  up  said  fire-alarm  system,  and  thft 
materials  furnished  therefor,  were  furnished 
and  done  in  accordance  with  the  terms  of 
saiil  agreement,  except  the  tone  of  the  bell, 
which  was  about  E  fiat,  instead  of  second  A 
below  the  miildle  C  on  the  organ;  that  de- 
fendant never  objected  to  the  bell  on  account 
of  the  difference  in  tone;  that  the  bell  was 
properly  manufactured,  was  of  the  best  bell 
metal,  had  been  properly  testetl  by  com]  etent 
experts  before  it  was  put  up  by  the  plaintiff, 
and  was  in  every  respect  a  first-cia^s  bell; 
that  bells  of  the  weight  of  the  one  in  (pies- 
tion  are  not  manufactured  of  the  tone  men- 
tioned in  said  agreement,  but  neither  one  of 
the  [)arties  knew  this  fact  at  tlie  time  said 
agreement  was  made.  As  soon  as  the  plain- 
tiff found  it  out  it  notified  said  C.  AV.  Cora- 
stock,  wlu)  was  the  chairman  of  the  commit- 
tee on  water-works  of  the  common  council, 
which  said  committee  had  in  charge  the  mat- 
ter of  sail  fire-uhirm  system,  and  who,  upon 
receiving  said  notice,  notified  the  plaintiff  to 


WHEN   TITLE  TASSES. 


159 


do  tlie  best  it  could  in  regard  to  tlie  tone  of 
tlie  bell,  wiiicli  it  did.  The  circuit  judge 
also  found  that  the  common  council,  acting 
in  good  I'aith,  made  a  thorough  and  fair  test 
of  tlie  worUiug  of  said  lire-alarm,  and  that 
tliey  refused  to  accept  the  same  in  behalf  of 
the  city  in  good  f;iitli,  and  for  tlie  reason  tiiat 
the  same  was  not  suited  to  tlie  needs  of  the 
city,  and  was  of  no  practical  utility  as  a  (ire- 
alarm.  He  also  found  that  the  agreement 
above  set  out  was  the  only  agreement  be- 
tween the  i)aities  in  respect  to  the  premises. 
As  a  conclusion  of  law  he  found  that  the 
plaintiff  had  nt)t  made  out  by  its  proofs  such 
a  case  as  would  entitle  it  to  a  judgment  in 
any  amount  whatever  against  the  defemlant. 

The  plaintilf  failed  lo  show  a  sulistantial 
compliance  with  that  portion  of  the  contract 
which  stipulated  that  the  tone  of  the  bell 
should  be  second  A  below  mid  lie  C  on  the 
organ.  We  do  nut  think  that  the  defendant 
waived  this  provision  of  the  aureement  by 
the  fact  that  bells  of  3,000  pounds'  weight  are 
not  manufactured  having  such  tone,  and  that 
Mr.  Comstock,  when  notified  of  that  fact,  told 
plaintilf  to  do  the  best  it  could  with  regard 
to  the  tone  of  the  bell.  The  fact  is  not  found 
that  JMr.  Comstock  had  any  authority  to  make 
any  changes  in  the  contract,  and  the  records 
of  the  proceedings  show  that  when  the  com- 
mittee reported  the  proposition  made  by  plain- 
tiff to  the  common  council  they  were  dis- 
charged. 

Counsel  for  plaintiff  makes  no  claim  in  this 
case  under  the  common  counts  in  assumpsit. 
He  chiims  to  recover  upon  tiie  sole  ground 
that  the  difference  in  the  tone  of  the  bell  was 
waived,  and  in  all  otlier  respects  plaintiff'  has 
fully  p:M-forined  its  contract,  and  the  defend- 
ant has  refused  to  accept  and  pay  thecontr.ict 
price.  While  admitting  that  the  riglits  of  the 
parties  .depend  upon  the  const  riKtion  of  the 
contract,  he  insists  that  the  defendant  did 
not  have  the  arbitrary  power  to  refuse  to  ac- 
cept the  work  done,  and  materials  furnished, 
notwitiifetanding  the  plaintilf  iiad  |)erform(  d 
in  every  particular;  that,  if  tiie  plaintiff 
I)erformed  the  agreement  on  its  part,  the  de- 
fendant was  bound  to  accept  ajul  pay.  He 
admits  that  the  defendant  had  the  right  to 
test  the  property  for  the  purpose  of  ascertain- 
ing whether  it  was  according  to  contract,  and 
if  it  was  they  were  bound  to  be  satisfied,  and 
were  legally  liable  to  pay  the  contract  price. 
The  particular  clauses  of  the  contract  to  be 
construed  read  as  follows:  "The  company 
agrees  to  do  all  of  the  above  work  ami  com- 
plete the  contract  in  about  thirty  days  from 
the  date  of  signing  the  contract,  and  your 


honorable  body  shall  thoroughly  test  the 
working  of  tiie  same  within  thirty  days  after 
the  completion  of  said  work,  and,  if  found  to 
be  satisfactory,  and  according  to  contract, 
accept  and  pay  for  the  same."  This  lan- 
guage is  contained  in  the  written  proposlion 
made  by  the  plaintiff  to  defendant.  The  writ- 
ten contract  executed  by  the  parties  con- 
tained this  clause,  namely:  "Said  lirst  party 
to  have  thirty  days  after  contract  is  complet- 
ed to  test  bell  and  working  ai)paratus,  and  ia 
case  same  is  satisfactory,  as  per  contract, 
then  they  agree  to  pay,"  etc.  The  i)roposi- 
tion  of  the  plaintiff  was  attached  to  and  made 
a  part  of  tlie  contract  between  the  parties, 
and  consequently  these  clauses  must  be  con- 
strued together.  The  language  employed  by 
the  plaintiff  in  making  the  proposition  clear- 
ly indicates  that  the  council  was  not  obliged 
to  accept  unless  the  work  was  done  according 
to  contract,  and  was  also  satisfactory,  and 
this  is  a  I'easonable  construction  of  the  con- 
tract. The  council  were  acting  in  a  repre- 
sentative capacity,  and  in  the  interest  of  the 
public.  This  contract  involved  a  change  in 
their  system,  and  was  to  them  in  the  nature 
of  an  experiment.  What  they  required  was 
ethciency  in  the  system  which  they  were 
about  to  adopt,  which,  while  it  might  oper- 
ate well  under  a  paid  lire  department,  should 
be  adapted  to  the  workings  of  a  volunteer  tire 
de[)artment,  the  members  of  which  are  in 
general  following  th^-ir  usual  avocations,  and 
volunteer  their  services  upon  an  alarm  of 
fire.  It  would  a|)pear  that  the  alarm  should 
be  such  that  the  members  would  hear  it  wiiile 
about  their  business  in  their  shops  and  count- 
ing rooms,  as  well  as  when  in  their  houses  at 
night.  The  council  had  a  right,  not  only  to 
test  the  workings  of  the  system  to  ascertain 
wlielh'r  it  was  according  to  contract,  but 
to  satisfy  themselves  if  the  system  furnished 
an  alarm  sullicient  for  the  purpose  for  which 
they  designed  to  employ  it.  The  clause  last 
cited  from  the  written  contract  does  not 
change  the  import  of  the  clause  above  quoted 
from  the  plaintiff's  proposition.  They  must 
be  construed  together,  and  the  reasonable 
construction  of  them  is  that  the  city  of  VAg 
liajiids  was  not  obliged  to  accept  and  pay  for 
the  lire-alarm  furnished  by  the  plaintiff,  un- 
less it  was  satisfactory  to  its  common  coun- 
cil when  tested.  Machine  Co.  v.  Smith,  50 
Mich.  5G5,  15  X.  W.  liep.  900;  Machine 
Works  V.  Lowell,  (32  Mich.  546,  29  X.  W. 
Eep.  105;  Manufacturing  Co.  v.  Ell.s,  68 
Mich.  101,  35  N.  W.  Kep.  841. 

The  judgment  of  the  circuit  court  is  af- 
firmed.    Tlie  other  justices  concurred. 


160 


WHEN   TITLE  PASSES. 


COMMERCIAL   NAT.   BANK   v.   GIL- 
LETTE. 

(90  Iiul.  268.) 

Snproino  Court  of  Indiana.     May  Temi,   188.3. 

.1.  M.  Yanfieet,  lor  appellant.  J.  H.  Baker 
and  J.  A.  S.  Mitcliell,  for  appellee. 

ELLIOTT,  J.  The  Elkbart  Car  Company, 
by  a  Avritteu  contract,  sold  to  the  appellant 
510  car  wheels,  constituting  a  part  of  1,1UU 
Avheels;  at  the  time  of  the  sale  the  wheels 
were  in  one  common  mass,  and  there  was  no 
separation  nor  any  designation  of  the  wheels 
sold  to  the  appellant;  after  the  execution  of 
the  contract  the  entire  lot  of  Avheels  was 
seized  upon  executions  issued  at  the  suit  of 
appellee,  and  this  action  was  brought  for  the 
possession  of  those  sold. 

The  contention  of  appellee  is  that  appellant 
acquired  no  title,  because  the  articles  sold 
were  not  designated  or  separated  from  the 
common  lot  of  which  they  formed  a  part,  and 
this  contention  prevailed  in  the  court  below. 

There  is  much  strife  in  the  American  cases 
upon  this  question,  but  none  in  the  English. 
The  weight  of  the  former  is,  perhaps,  with 
the  theory  of  appellant,  but  the  text-writers 
are,  so  far  as  we  have  examined,  all  with  the 
English  decisions.  Our  own  eases  are  in  har- 
mony with  the  long  established  rule  of  the 
common  law.  In  the  case  of  Bricker  v. 
Hughes,  4  Ind.  14(i,  the  English  rule  was  ap- 
proved and  enforced.  In  Murphy  v.  State,  1 
Ind.  306,  the  court  said:  "To  render  a  sale  of 
goods  valid,  the  specilic,  individual  goods 
must  be  agreed  on  by  the  parties.  It  is  not 
enough  *  *  *  that  they  are  to  be  taken 
from  some  specified  larger  stock,  because 
there  still  remains  something  to  be  done  to 
designate  the  portion  sold,  which  portion,  be- 
fore the  sale  can  be  completed,  must  be  sep- 
arated from  the  mass."  This  doctrine  found 
approval  In  Scott  v.  King,  12  Ind.  2Uo,  and 
there  are  other  cases  recognizing  it  as  the  cor- 
rect one,  among  them  Mottit  v.  Green.  9  Ind. 
198;  Raihvay  Co.  v.  Maguire,  (i2  lud.  140; 
Bertelson  v.  Bower,  81  Ind.  512;  Lester  v. 
East,  49  Ind.  588,  vide  o])inion.  page  594.  The 
rule  which  our  court  has  adcjrted  is  upheld  by 
the  American  cases  of  Hutchinsoij  v.  Hunter, 
7  Pa.  St.  140;  Haldeman  v.  Duncan,  51  Pa. 
St.  66;  Fuller  v.  Bean.  M  N.  H.  290;  Ocking- 
ton  v.  Ritchey,  41  N.  H.  275;  Morrison  v. 
Woodley,  84  111.  192;  Woods  v.  McGee.  7 
Ohio,  467;  McLaughlin  v.  IMatti.  27  Cal.  46::!; 
Courtright  v.  Leonard.  11  Iowa.  '.V2;  Hopes  v. 
Lane,  9  Allen,  502;  Ferguson  v.  Northern 
Bank,  14  Bush,  5.55.  In  Michigan,  the  rule 
seems  not  to  be  definitely   settled,   but   in  a 


late  case  it  was  said:  "To  the  elaborate  argu- 
ment made  for  the  defence  to  show  that  there 
can  be  neither  a  sale  nor  a  pledge  of  property 
without  in  some  manner  specially  distinguish- 
ing it,  we  fully  assent,  and  we  have  no  pur- 
pose to  qiL'ilify  or  weaken  the  authority  of 
Anderson  v.  Brennemau,  44  Mich.  198,  6  N. 
W.  222."  Bank  v.  Hibbard,  48  Mich.  118,  11 
N.  W.  834. 

The  civil  law  rule  is  the  same  as  that  of 
the  common  law,  and  our  great  lawyers  have 
given  it  unhesitating  approval.  2  Kent,  Comm. 
639;   Story.  Sales,  §  296. 

The  American  cases  which  have  departed 
from  the  long  settled  rule,  are  built  on  the 
cases  of  Kimberly  v.  Patchin,  19  N.  Y.  330, 
and  Pleasants  v.  Pendleton,  6  Rand.  473,  and 
these  cases  proceed  upon  the  theory  that  com- 
mercial interests  demand  a  modification  of 
the  rule.  In  our  judgment,  commercial  inter- 
ests are  best  promoted  by  a  rigid  adherence  to 
the  rule  which  the  sages  of  the  law  have  so 
long  and  so  strongly  approved.  The  rule  se- 
cures real  transactions  and  actual  sales,  and 
thus  checks  the  wild  spirit  of  speculation.  It 
prevents,  in  no  small  measure,  the  making  of 
mere  wagering  contracts;  it  puts  business  on 
a  stable  basis,  and  makes  it  essential  that 
there  should  be  real,  and  not  sham,  trans- 
fers of  property;  it  makes  titles  secure,  pro- 
tects creditors  and  purchasers  and  represses 
fraud.  If  it  were  granted  that  the  rule  does 
somewhat  interfere  with  the  freedom  of  busi- 
ness transfers,  still  the  good  it  produces  far 
outweighs  this  inconvenience.  But  we  do  not 
believe  It  does  interfere  with  actual  business 
transfers,  for  common  experience  informs  us 
that  real  sales  are  seldom,  if  ever,  made  with-, 
out  a  specific  designation  of  the  thing  bought. 
The  rule  may  interfere  with  dealers  in  "mar- 
gins," makers  of  "corners,"  and  framers  of 
"options,"  and  to  affirm  that  it  does  do  this  is 
to  give  it  no  faint  praise.  In  principle  the 
rule  is  sound,  and  in  practical  operation  salu- 
tary. 

The  efforts  made  by  the  courts  that  have 
departed  from  it  to  make  exceptions,  to  manu- 
facture distinctions  and  point  out  differences 
in  order  to  escape  disastrous  consequences,  af- 
ford strong  evidence  of  the  wisdom  of  the 
rule.  The  fine  of  decisions  in  some  of  the 
states,  where  a  departure  has  been  taken,  is 
a  devious  and  tortuous  one,  and  this  is  to  be 
expected  Avhen  once  sound  principle  is  turned 
from  and  new  rules  sought  and  adopted  which 
have  no  support  in  fundamental  principles. 

AVe  have  no  disposition  to  depart  from  the 
rule  which  has  so  long  prevailed  in  this  state 
and  elsewhere. 

Judgment  atftrmed. 

Petition  for  rehearing  overruled. 


WHEN  TITLE   PASSES. 


161 


KIMBEKLY   et  al.   v.   TATCHIX. 

(19  X.  Y.  880.) 

Court  of  Aiipcals  of  New   York.      Junt'  Titiu. 
18.J9. 

Appeal  from  the  suprpuie  court.  Actiou  to 
ret-over  the  value  of  (j(»0(t  bushels  of  wheat,  al- 
leged to  have  beeu  the  prnpert;^'  of  the  i)laiutiffs, 
iind  to  have  beeu  converted  by  the  defendant. 
Upon  the  trial  before  Mr.  Ju.<tice  Greene,  at  the 
Erie  circuit,  it  was  provetl  that  one  Dickinson 
had  in  warehouse,  at  Littlefort,  in  Wisconsin, 
two  piles  of  wheat,  auiouutiuj;  to  G241>  bushels. 
John  Slmttleworth  proposetl  to  purchase  OoOO 
bushels  of  wheat.  Upon  beiuj::  shown  the  piles, 
he  expressed  a  doubt  whether  they  contained 
that  quantity.  Dickinson  declared  his  opinion 
that  they  did.  and  asreed  to  make  up  the  quan- 
tity- if  they  fell  shoit.  A  sale  was  then  made 
at  sevent.v  cents  per  Ijushel,  Dickinson  sisniins 
and  deliveriuj:  to  Shuttleworth  a  memorandum, 
as  follows:— 

"Littlefort,  February  17.  1848. 
■"John  Shuttleworth  bought  of  D.  O.  Dickinson. 
<)(K)(1    l)ushels    of    wheat,    delivered    ou 

board.   70  cents $4,200 

lieceivetl    his    draft    upon    John 

Shuttleworth.  of  Buffalo,  for.  .   $2,100 

To  remit  me l.fiOO 

Five  drafts  of  $100  each .300 

4.200 

"D.  O.  Dickinson." 

He  also  signed  and  delivered  to  Shuttle- 
worth  this  paper,  viz.: — 

"Littlefort.  Febrtiaiy  IS.  1848.  GOOO  bushels 
wheat.  Received  in  store  GOOO  bushels  of 
wheat,  subject  to  the  order  of  John  Shuttle- 
Avorth.  free  at  all  charges,  on  l)oard.  D.  O. 
Dickin.>-on.'' 

The  wheat  was  left  umlisturbed  in  the  ware- 
house. Shuttleworth  sold  the  wheat  to  the  de- 
fendant, assigning  to  him  the  bill  of  s^de  and 
Avarehouse  receipt.  Dickinson,  shortly  after- 
Awards,  sold  the  whole  quantity  of  wheat  in  the 
two  piles  to  a  person  under  whom  the  plain- 
tiffs derived  title.  The  defendant  having  ob- 
tained the  possession  of  the  wheat,  this  action 
was  bi'ought.  The  judge,  under  exception  by 
the  defendant,  directed  a  verdict  for  the  plain- 
tiffs, Avhich  was  rendered,  and  the  judgmeut 
thereon  having  been  affirmed  at  general  term, 
hi  the  eighth  district,  the  defendant  appealed 
to  this  court. 

John  H.  Reynolds,  for  appellant.  John  L. 
Talcott.  for  respondents. 

COMSTOCK,  J.  Both  parties  trace  their  title 
to  the  wheat  in  controversy  to  D.  O.  Dickinson, 
A\ho  was  the  former  oAvner,  and  held  it  in 
store  at  Littlefort,  Wisconsin.  The  defendant 
claims  through  a  sale  made  by  Dickinson  to 
one  ShuttleAvorth  on  the  18th  of  Februaiy, 
1848.  If  that  sale  AA'as  effectual  to  pass  the 
title,  it  is  not  now  pretended  that  there  is  any 
gi'ound  on  which  the  pbiiutiffs  can  recover  in 
this  suit.  The  sale  to  the  person  under  Avhom 
they  claim,  was  about  tAA'o  and  a  half  months 
junior  in  point  of  time. 

A'AN  ZILE  8EL.CAS.S.\T.ES— 11 


The  sale  to  Shuttleworth  was  by  a  Avritins 
in  the  form  of  a  present  traasfer  of  6000  bush- 
els of  wheat,  at  seventj-  cents  per  bushel.  No 
manual  delivery  was  then  made,  but  instead 
thereof  the  Aendor  executed  and  deliA'ered  tn 
the  vendee  another  instrument,  declaring  that 
he  had  received  in  store  the  <ioi)0  bushels  sub- 
ject to  the  vendee's  order;  of  the  price  $2G<><| 
AA-as  iKiid  doAA-n.  and  the  residue  $lG0o.  which 
AAas  to  be  paid  at  a  future  day,  the  purclwser 
afterAA-ards  offeree  to  pay,  according  to  the 
agreement.  So  tar  the  contract  had  all  the 
requisites  of  a  perfect  sale.  The  sum  to  be 
paid  b.\-  the  purchaser  was  a.scertained  because 
the  number  of  bushels  and  the  price  per  bushe! 
were  specified  in  the  contract.  Although  the 
article  Avas  not  delivered  into  the  actual  r)0sses- 
sion  of  the  ptirchaser,  yet  the  seller,  by  the 
plain  terms  of  his  agreement,  constituted  him- 
self the  bailee,  and  hencefoith  stood  in  that 
relation  to  the  purchaser  and  to  the  properts*. 
That  was  equal  in  its  results  to  the  most  formal 
delivers-,  and  no  argument  is  required  to  sIioav 
that  the  title  was  completel.A-  diA'ested,  unless 
a  difficulty  exists  yet  to  be  considered. 

The  quantity  of  wheat  in  store  to  Avhich  the 
contract  rekited,  A\as  estimated  by  the  parties 
at  about  GOOO  bushels.  But  subsequently,  aft- 
er Dickinson  made  another  sale  of  the  same 
wheat  to  the  party  under  whom  the  plaintiff's 
claim,  it  appeared  on  measui-ement  that  the 
number  of  bushels  was  G249.  being  an  excess 
of  249  bushels.  When  Shuttleworth  bought 
the  GOOO  bushels,  that  quantity  was  mixed  in 
the  storehouse  Avith  the  excess,  and  no  meas- 
urement or  separation  was  made.  The  .sale 
was  not  in  bulk,  but  precisel.v  of  the  GtMiO  bush- 
els. On  this  gi'ound  it  is  claimed,  on  the  part 
of  the  plaintiffs,  that  in  legal  effect  the  con- 
tract was  exeeutoiy.  in  other  words  a  mere 
agi'eemeut  to  sell  and  deliver  the  specified  quan- 
tity, so  that  no  title  passed  b.v  the  transaction. 
It  is  not  denied,  hoAvcA-er.  nor  does  it  admit  of 
denial,  tluit  the  parties  intended  a  ti-ansfer  of 
the  title.  The  argument  is.  and  it  is  the  only 
one  which  is  even  plausible,  tliat  the  law  over- 
rules that  intention,  although  expressed  in  plain 
AA-ritten  language,  entirely  appropriate  to  the 
puipose. 

It  is  a  rule  asserted  in  many  legal  authorities, 
but  which  may  be  quite  as  fitl.v  called  a  nile 
of  reason  and  logic  as  of  law.  that  in  order  to 
an  executed  sale,  so  as  to  transfer  a  title  from 
one  part.A-  to  another,  the  thing  sold  must  be 
ascertained.  This  is  a  self-eA'ident  tnith.  Avheu 
applied  to  those  subjects  of  proinrty  Avhich 
are  distinguishable  by  their  physical  attri- 
butes from  all  other  things,  and.  therefore, 
are  capable  of  exact  identification.  Xo  per- 
son can  be  said  to  oAvn  a  horse  or  a  pic- 
ture, unless  he  is  able  to  identify  the  chat- 
tel or  specify  Avhat  horse  or  what  picture 
it  is  that  belongs  to  him.  It  is  not  only 
legall.v.  but  logically,  impcssible  to  hold  propert>- 
in  such  things,  unless  the.v  are  ascertained  and 
distinguished  froi  all  other  things;  and  this. 
I  apprehend,  is  the  foundation  of  the  rule  that, 
ou  a  sale  of  chattels,  in  order  to  pass  the  title, 


162 


WIIKX  TITLE   PASSES. 


tho  artirlos  must,  if  not  clolivered,  be  desi.u;- 
uated,  so  that  posst^ssiou  can  bo  takon  by  the 
pnrcliaser  without  any  fuirlicr  act  en  tlie  pai't 
of  the  seller. 

But  property  can  bt  ac(iuired  and  held  in 
many  tliin.tis  which  are  incapable  of  such  an 
identification.  Articles  of  this  nature  are  sold, 
not  by  a  description  which  refers  to  and  distin- 
jiuishes  the  particular  thing,  but  in  (piantities, 
which  are  ascertained  by  weiirht,  measure,  or 
count:  the  constituent  parts  which  make  up 
the  mass  beins  uudistinuuisliable  from  each 
other  by  any  physical  difference  in  size,  shape, 
texture,  or  ciuality.  Of  this  nature  are  wine, 
oil,  wlu^at,  and  the  other  cereal  grains,  and  the 
tlom-  manufactured  from  them.  These  can  be 
identified  only  in  masses  or  quantities,  and  in 
that  mode,  therefore,  they  are  viewed  in  the 
contracts  and  dealings  of  men.  In  respect  to 
such  things,  the  rule  above  mentioned  must  be 
applied  according  to  the  nature  of  the  subject. 
In  an  executed  and  perfect  sale,  the  things 
sold,  it  is  true,  must  be  ascertained.  But  as 
it  is  not  possible  in  reason  and  philosophy  to 
identify  each  constituent  particle  composing  a 
ciuantity,  so  the  law  does  not  require  such  an 
identification.  Where  the  quantity  and  the  gen- 
eral mass  from  which  it  is  to  be  taken  are 
specified,  the  subject  of  the  contract  is  thus 
ascertained,  and  it  Decomes  a  possible  result 
for  the  title  to  pass,  if  the  sale  is  complete  in 
all  its  other  circumstances.  An  actual  deliv- 
ery indeed  camiot  be  made  unless  the  whole  is 
transferred  to  the  possession  of  the  piu'chaser, 
or  imless  the  particular  cpiantity  sold  is  sep- 
arated from  the  residue.  But  actual  delivery 
is  not  indispensable  in  any  case  in  order  to  pass 
a  title,  if  the  thing  to  be  dehvered  is  ascer- 
tained, if  the  price  is  paid  or  a  credit  given,  and 
if  uctlnng  ftirther  remains  to  be  done  in  regard 
to  it. 

It  appears  to  me  that  a  very  simple  and  ele- 
mentary incjuiry  lies  at  the  foundation  of  the 
present  case.  A  quantity  of  wheat  being  in 
store,  is  it  possible  in  reason  and  in  law  for  one 
man  to  oAvn  a  given  portion  of  it  and  for  an- 
other man  to  own  the  residtie  without  a  separa- 
tion of  the  parts?  To  bring  the  inqiniy  to  the 
facts  of  the  case:  In  the  storehouse  of  Dickin- 
son there  was  a  quantitj-  not  precisely  knoAvn. 
In  any  eonceival)le  circumstances  could  Shut- 
tleworth  become  owner  of  GOOD  bushels,  and 
Dickinson  of  the  esidue,  which  turned  out  to 
be  240  bushels,  without  the  portion  of  either 
being  divided  from  the  other?  The  answer  to 
this  in(iuiiy  is  plain.  Suppose  a  third  person, 
being  the  prior  OAA-ner  of  the  whole,  had  given 
to  S.  a  bill  of  sale  of  (iCMJiJ  bushels,  and  then 
one  to  D.  for  the  residue  more  or  less,  intend- 
ing to  pass  to  each  the  title,  and  expressing 
that  intention  in  plain  words,  what  would  have 
been  the  result?  The  former  owner  most  cer- 
tainly would  have  parted  with  all  his  title.  If, 
then,  the  two  purchasers  did  not  acqtiire  it,  no 
one  could  own  the  wheat,  and  the  title  would 
be  lost.  This  would  be  an  absurdity.  But  if 
the  parties  thus  purchasing  could  and  would  be 
the  owners,  how  would  they  hold  it?     Plainly 


according  to  their  contracts.  One  would  be  en- 
titlvd  to  (lOOO  bu<hels.  and  the  other  to  what 
remained  after  that  (luantity  was  subtracted. 

Again  suppose,  Dickinson  having  in  store  and 
owning  24!)  bushels.  Shuttleworth  had  deposit- 
ed with  him  (jooo  btishels  for  storage  merely, 
both  parties  agreeing  that  the  quantities  might 
be  mixed.  This  would  be  a  case  of  confusion 
of  property  whei'e  ne'ther  would  lose  his  title. 
In  the  laAV  of  bailments  it  is  entirely  settled  that 
S..  being  the  bailor  of  the  (jO(K)  bushels,  woiild 
lose  nothing  by  the  mixture,  and,  it  being  done 
by  consent,  it  is  also  clear  that  the  bailee  would 
lose  nothing.  Story,  Bailm.  §  40;  2  Bl.  Comm. 
405. 

These  and  other  illustrations  which  might 
be  suggested,  demonstrate  the  possibility  of  a 
divided  ownership  in  the  G249  bushels  of  wheat. 
If,  then,  the  law  admits  that  the  property, 
while  in  mass,  could  exist  under  that  condition, 
it  was  plainly  competent  for  the  parties  to  the 
sale  in  question,  so  to  eleal  with  each  other  as 
to  effectuate  that  result.  One  of  them  being 
the  owner  of  the  whole,  he  could  stipulate  and 
agree  that  the  other  should  thene-eforth  own 
GOOO  bushels  without  a  separation  from  the 
residue.  And  thiS;  I  thinlv.  is  precisely  what 
was  done.  The  GOOO  bushels  might  have  been 
measured  anel  delivered  to  the  ptirchaser,  and 
then  the  same  wheat  might  have  been  reele- 
livered  to  the  seller  under  a  contract  of  bail- 
ment. In  that  case  the  seller  would  have  given 
his  storehouse  receipt  in  the  veiy  terms  of  the 
one  which  he  actually  gave;  and  he  might, 
moreover,  have  mixed  the  wheat  tints  redeliv- 
ered with  his  own,  thereby  reducing  the  quan- 
tity sold  and  the  quantit:^'  unsold  again  to  one 
common  mass.  Now  the  contract  of  sale  and  ot 
bailment,  both  made  at  the  same  time,  pro- 
duced this  very  result.  The  formalities  of  meas- 
urement and  delivery  pursuant  to  the  sale,  anel 
of  redelivery  according  to  the  bailment— result- 
ing in  the  same  mixtiu'e  as  before — most  as- 
suredly were  not  necessaiy  in  order  to  pass 
the  title,  because  these  formalities  would  letive 
the  property  in  the  veiy  same  condition  nneler 
which  it  was  in  fact  left;  that  is  to  say,  in  tlie 
actual  custody  of  the  vendor,  and  blended  to- 
gether in  a  common  mass.  Those  formal  and 
ceremonial  acts  were  dispensed  with  by  the 
contract  of  the  parties.  They  went  directly  to 
tlie  result  Avithout  the  performance  of  any  use- 
less ceremonies,  and  it  would  be  strange,  in- 
deed, if  the  law  denied  their  power  to  do  so. 

There  are  in  the  books  a  considerable  num- 
ber of  cases  having  a  real  or  some  apparent 
bearing  upon  the  question  under  consideration. 
Some  of  them  veiy  unequivocally  support  the 
defenelant's  title  under  the  sale  to  Shuttleworth. 
A  few  only  of  these  will  be  cited.  In  White- 
house  V.  Frost,  12  East,  614,  the  vendors  owned 
forty  tons  of  oil  secured  in  one  cistern,  and 
they  sold  ten  tons  out  of  the  forty,  but  the 
quantity-  sold  was  not  measured  or  delivered. 
The  purchaser  sold  the  same  ten  tons  to  an- 
other person,  and  gave  a  written  order  on  the 
original  vendors,  which,  on  being  presented, 
they  accepted,  by  writing  the  word  "Accepted" 


WHEN  TITLE  PASSES. 


363 


ou  the  fact'  of  the  oi'iler,  and  sij^iiinj;  their 
iiainos.  It  Avas  held  by  the  En^Ush  common 
pleas  that  the  title  passed;  considerable  stress 
b(  iiif;-  laid  on  the  acceptance  of  the  order,  which, 
it  Avas  said,  placed  the  vendors  in  the  rela- 
tion of  bailees  to  the  (inantity  f«ld.  This  was 
in  1810.  In  the  following  year  the  case  of 
Jackson  v.  Anderson,  4  Taunt.  24,  was  decided 
in  the  kinj^'s  bench.  That  was  an  action  of 
trover  for  liKiO  pieces  of  coin  called  Spanish 
dollars.  Mr.  Fieldins-,  at  Buenos  Ayres,  re- 
mitted to  Laycock  &  Co..  at  London.  .$4700, 
and  advised  the  plaintiffs  that  11)00  of  the 
number  were  desijined  for  tliem  in  payment 
for  soods  bousht  of  them.  Laycock  &:  Co.  re- 
ceived the  4700  pieces,  and  plediit'd  the  whole 
of  them  to  the  defendant,  who  sold  them  to  the 
Banlv  of  p]n;,dand.  It  was  held:  1.  That  the 
letter  of  advice  was  a  sutticient  appropriation 
of  .$10r.O  to  the  plaintiffs.  2.  That  the  plain- 
tiffs and  defendant  did  not  become  joiut-ten- 
ants  or  tenants  in  common  of  the  dollars.  3. 
That  although  no  specific  dollars  were  sep- 
arated from  the  residue  for  the  pLiintiffs,  yet 
as  the  defendant  had  converted  the  whole,  tro- 
ver Avould  lie  for  the  plaintiffs'  share.  Of 
course  the  action  in  its  nature  directly  involved 
the  plaintiffs'  title,  and  it  was  held  that  the 
sale  or  api)ropriatiou  of  a  part  without  any  sep- 
aration was  a  perfei't  sale.  In  Pleasants  v. 
I*eudleton.  G  Kand.  473,  the  sale  (omitting  im- 
material circumstances)  was  of  110  out  of  123 
barrels  of  flour,  situated  in  a  warehouse,  all  of 
the  same  brand  and  quality.  It  was  held  by 
the  ^'irginia  court  of  ajiiieals.  upon  veiy  elab- 
orate consideration,  and  after  a  review  of  all 
the  cases,  that  the  title  was  transferred  by  the 
sale.  See,  also.  Damon  r.  Osbnrn.  1  Pick. 
477;  Crofoot  v.  Bennett.  2  X.  Y.  2.j8.  In  the 
last  mentioned,  Avhich  was  decided  in  this  court, 
the  sale  was  of  43.000  bricks  in  an  unfinished 
kiln  containing  a  larger  quantity.  A  formal 
possession  of  the  whole  brick-yard  was  taken 
by  the  purchaser.  It  was  held  that  he  ac- 
quired title  to  the  43,000,  although  no  sei)ara- 
ticn  was  made.  In  the  opinion  of  .ludge  Strong, 
the  case  was  made  to  turn  mainly  ou  a  supposed 
delivery  of  the  Avhole  quantity.  But.  with  def- 
erence, that  circmnstance  dues  not  ap])ear  to 
me  to  have  been  the  material  uiie.  inasnmch  as 
aU  the  bricks  confessedly  were  not  sold.  The 
delivery,  therefore,  did  not  make  the  sale,  and 
if  part  could  not  be  sold  without  being  sep- 
arated, I  do  not  see  hoAV  a  formal  delivery  of 
the  whole  bi'ick-yard  could  cure  the  dittit-ulty. 
The  learned  judge  speaks  Oi  the  transaction  as 
a  delivery  of  the  wholi^  (luantity  "with  the  priv- 
ilege of  selection."  But  assuming,  as  he  did, 
that  the  want  of  selection  or  separation  was 
the  precise  difficulty  to  be  overcome,  it  is  not 
easy  to  see  how  a  privilege  to  select  could 
change  the  title  before  the  selection  was  actual- 
ly nride.  The  case,  therefore,  it  seems  to  me, 
can  only  stand  on  the  ground  that  the  sale 
was.  in  its  natiu'e.  complete;  the  formal  deliv- 
eiy  of  the  whole  being  doubtless  a  circumstance 
entitled  to  Aveight  in  arriving  at  the  intention 
nf  the  parties.     The  case  is,  in  short,  a  strong 


authority  to  prove  thai,  in  sales  by  weight, 
measure,  or  count,  a  sepai-ation  of  the  part  sold 
from  the  mass  is  not  in  all  cases  a  finidann'ntal 
requisite. 

Referring  now  to  cases  whei'e  it  has  been 
held  that  .sales  of  this  general  iwture  were 
incomplete,  it  will  be  found  that  they  are  not 
es.sentially  and  neces.sarily  opposed  to  the  ciui- 
Clusion  that,  in  the  instance  before  us,  the  tith? 
was  changed.  In  AVhite  v.  Wilks.  .")  Taunt 
170,  a  merchant  sold  twenty  tons  of  oil  out  of 
a  stock  consisting  of  <lifterent  Large  quanti- 
ties in  different  cisterns,  and  at  various  ware- 
houses. The  note  of  sale  did  not  express  tht* 
quality  or  kind  of  oil  sold,  or  the  cistein  or 
warehouse  from  which  it  was  to  1k'  talcen. 
and  the  purcha.ser  did  not  even  know  wheri* 
the  particuLir  oil  lay  which  was  to  satisfy  the 
contract.  Very  dearly  the  title  could  not  pas.^? 
upon  such  a  .sale;  and  so  it  was  held,  although 
the  seUer  was  entitled  by  the  contract  to 
charge  "Is.  per  ton  per  week  rent."  for  keep- 
ing the  oil.  A  very  different  (piestion  would 
have  been  presented  if  the  cistern  from  which 
the  twenty  tons  were  to  be  taken  had  been 
specified.  The  mass  and  quality  would  then 
have  been  ascertained.  As  it  was,  the  suljjeitt 
of  the  contract  was  not  identified  in  any  man- 
ner. The  remarks  of  the  judge,  evidently  not 
made  with  much  deliberation,  must  be  con- 
strued with  reference  to  the  particular  facts 
of  the  ca.se. 

In  Austen  v.  Craven.  4  Taunt.  044.  there 
was  a  contract  to  sell  200  hogsheads  of  sugar, 
to  be  of  foiu-  different  kinds  and  qualities 
which  were  specifiwl.  It  did  not  appear  that 
the  seller,  at  the  time  of  the  contract,  had 
the  sugar  on  hand,  or  any  part  of  it,  and  the 
fact  was  assumed  to  be  otherwise.  The  sale- 
was,  moreover,  at  so  much  per  cwt..  rniuir- 
iug  that  the  sugar  should  be  weighed  in  or- 
der to  ascertain  the  price.  In  these  circum- 
stances the  case  was  considered  plainly  dis- 
tinguishable from  Whitehouse  v.  Frost,  su- 
pra, and  it  AA'as  held  that  the  title  did  not 
pass.  I  do  not  see  the  slightest  ground  for 
questioning  the  decision,  although,  pei'haus, 
one  or  two  remarks  of  Chief  .Justice  ^lans- 
ficld  are  capable  of  a  wider  application  than 
the  facts  of  the  case  would  justify. 

The  two  cases  last  mentioned  have  been  not 
unfretjuently  cited  in  various  later  English  and 
American  authorities,  which  need  not  be  par- 
ticularly referred  to.  Some  of  these  authori- 
ties ma.v  suggest  a  doubt  whether  the  title 
passes  on  a  mere  sale  note  by  measure  or 
weight  out  of  a  larger  quantity  of  the  same 
kind  and  (piality,  there  being  no  separation 
and  no  other  circumstances  clearly  evincing 
an  intention  to  A'est  the  title  in  the  purchaser. 
It  is  unnecessar.v  now  to  solve  that  donbt.  be- 
cause none  of  the  decisions  announce  the  ex- 
treme doctrine,  that  where,  in  such  cases,  the 
parties  expressly  declare  an  intention  to 
change  the  title,  there  is  any  legal  impossibili- 
ty in  the  way  of  that  design.  Upon  a  sim- 
ple bill  of  sale  of  gallons  of  oil  or  bushels  of 
<\iieat.  mixed  with  an  ascertained  and  dertnrd 


164 


WHEN  TITLE   PASSES. 


larpT  (lunniiry,  it  m;i.v  or  may  not  be  consid- 
ered tliat  the  [)artie.s  intend  that  the  portion 
sold  sliall  be  nieasnred  before  the  purchaser 
becomes  invested  with  the  title.  That  may 
be  i-ejrarded  as  an  act  remaiuinj;-  to  be  done,  in 
which  both  parties  have  a  ri^ht  to  participate. 
But  it  is  surely  competent  for  the  vendor  to 
say  in  terms--  that  he  waives  that  rijjht.  and 
that  the  purchaser  shall  become  at  once  the 
lefial  owner  of  the  number  of  pdlons  or  bush- 
els enibrac«'d  in  the  sale.  If  he  cannot  say 
this  effectually,  then  the  reason  must  be  that 
two  men  cannot  be  owners  of  separate  ((uanti- 
ties  or  i)roportlons  of  an  undistin.miishable 
mass.  Tliat  conclusion  would  be  a  naked  ab- 
surdity, and  I  have  shown  that  sucli  is  not  the 
law.  In  the  case  before  us  the  vendor  not 
only  executed  his  bill  of  sale  professiuji  to 
transfer  ♦MH)0  Imshels  of  wheat,  but,  waiving- 
all  fiu'ther  acts  to  be  done,  in  order  to  com- 
plete the  transaction,  he  ackuowledjied  himself, 
by  another  instrument,  to  hold  the  same 
wheat  in  store  as  the  l)ailee  thereof  for  the 
purchaser.  If  his  obliji'ations  from  that  time 
were  not  simply  and  precisely  those  of  a 
bailee,  it  is  because  the  law  would  not  suft'er 
him  to  stand  in  that  relation  to  the  pi'operty 
for  the  reason  that  it  was  mixed  with  his  own. 
But  no  one  will  contend  for  such  a  doctrine. 

I  repeat  it  is  unnecessary  to  refei'  to  all  the 
cases,  or  to  determine  between  such  as  may 
appear  to  be  in  contiict  with  each  other.  X(jne 
of  them  go  to  the  extent  of  holdin;j;  that  a  man 
cannot,  if  he  wishes  and  intends  so  to  do. 
make  a  perfect  sale  of  part  of  a  quantity  with- 
out actual  separation,  where  the  mass  is  as- 
certained by  the  contract  and  all  parts  are  of 
the  same  value  and  undistinjinislialile  fiom 
each  other. 

One  of  the  cases,  however,  not  yet  citi'il. 
deserves  a  brief  consideration,  because  it  was; 
determined  in  this  court,  and  has  been  mni-h 
relied  on  by  the  plaintiffs'  counsel.  I  ]-cfer 
to  (iardiner  v.  Su.vdam.  7  X.  Y.  .■!.')7.  The 
owner  of  tlour  delivered  it  in  various  parcels 
to  a  warehouseman,  and  from  time  to  time 
took  receipts  from  him.  One  of  these  re- 
ceipts was  held  by  the  defendants  and  others 
l)y  the  plaintiff's,  both  parties  haviuji'  acfei)t- 
ed  and  paid  drafts  on  the  faith  thereof.  The 
defendants'  receipt  was  the  first  in  point  of 
time,  and  was  for  ~>:^G  barrels,  beinu'  giveu 
at  a  time  when  in  fact  there  were  but  2(>l 
barrels  in  the  warehouse,  so  that  it  covered 
:]3."»  more  than  Avere  then  on  hand.  But  other 
quantities  were  subseciuently  delivered  at  the 
warehouse,  all  of  the  same  kind  and  quality, 
and  the  defendants,  in  fact,  received  by  slii])- 
ment  to  them,  5(H)  barrels.  For  the  conver- 
sion of  this  quantity  they  Avere  sued  by  tlie 
])laintitt's,  who  had  failed  to  receive  the  flour 
which  their  receipts  called  for.  It  cannot  fail 
to  be  seen  from  this  statement  that  the  de- 
fendants, h.-ivinji'  the  first  receipt  and  receiv- 
ins  no  more  tlour  than  it  specified,  were  enti- 
tled to  judjrment  by  reason  of  the  priority  of 
their  title:  and  this  ^^round  of  decision  is  veiy 
clearly  stated  in  the  opinion  of  the  chief  jud^c. 
He  thought  if  the  transfer  of  the  receipts  could 


pa.ss  the  title  to  the  flour,  notwithstanding  rhe 
mixture  of  all  the  quantities  to.u'!  thei',  tliat  the 
one  held  by  the  defendants  entitled  them  not 
only  to  the  201  barrels  in  store  when  it  was 
given,  but  also  to  so  many  barrels  delivered 
in  store  afterwards  as  were  necessary  to  make 
up  their  number.  This  view,  wliich  ai)pears 
to  me  correct,  was  fatal  to  the  plaintiff's'  case. 
Bnt  in  another  aspect  of  the  controversy,  the 
learned  chief  judge  was  of  opinion  that  the 
transfer  to  the  plaintiffs  of  the  receipts  held 
by  then)  passed  no  title,  on  the  ground  that 
the  (juantities  which  they  respee-tively  covered 
were  all  mixed  together  in  tlie  storehouse. 
Assmuing  the  correctness  of  that  view — which 
I  am  constrained  to  question— the  case  is  still 
unlike  the  present  one.  The  transfer  of  a 
warehousemaJi's  receipt,  given  to  the  owner, 
was  certainly  no  more  than  a  simple  sale  note 
of  the  specified  numl)er  of  barrels;  and  where, 
in  such  cases,  that  is  tlie  whole  traiisaction  be- 
tween vendor  and  vendee,  I  have  already  ad- 
mitted a  doubt,  suggested  by  conflicting  cases, 
wliether  tlie  title  passes.  If  the  owner  of 
the  flour  had  held  it  in  his  own  wareiiouse.  and 
had  not  only  given  a  bill  of  sale  of  a  portion 
of  it,  but  had  himself  executed  to  the  pur- 
chaser another  instnunent  declaring  that  he 
held  the  quantity  sold  as  bailee  and  suliject 
to  order,  then  the  case  would  have  resembled 
the  one  now  to  be  determined. 

We  are  of  opinion,  therefore,  both  upon 
authority  and  clearly  upon  tlie  principle  and 
reason  of  the  thing,  that  the  defendant,  under 
the  sale  to  Shuttlewortli,  ac(iuired  a  perfect 
title  to  the  iKKXt  bushels  of  wheat.  Of  that 
(luantily  he  took  possession  at  Buffalo,  by  a 
writ  of  replevin  ag;unst  the  master  of  the  ves- 
sel in  which  the  whole  had  been  transported 
to  that  place.  For  that  taking  the  suit  wa.s 
biijuglit,  and  it  results  that  the  plaintiff"  cannot 
rt-covcr.  It  is  unnecessary  to  decide  whether 
the  iiarties  to  the  original  sale  became  tenants 
in  common.  If  a  tenancy  in  common  arises 
in  such  cases,  it  must  be  with  some  peculiai' 
incidents  not  usually  l)elonging  to  that  spe- 
cies of  ownership.  I  think  each  party  would 
liave  the  right  of  severing  the  tenancy  bj-  his 
own  act;  that  is,  the  right  of  taking  tlie  por- 
tion of  the  mass  which  belonged  to  him,  being 
accountable  only  if  he  invaded  the  quantity 
which  l)elonged  to  the  other.  But  assuming 
that  the  case  is  one  of  strict  tenancy  in  com- 
mon, the  defendant  bec-ame  the  owner  o^" 
(jOOO  and  the  plaintiff's  of  24!)  parts  of  the 
wlujle.  As  neither  could  maintain  an  action 
against  the  other  for  taking  possession  merely 
of  tli(^  whole,  more  clearly  he  cannot  if  the 
other  talces  only  tlie  (piantity  whicli  l)elougs  to 
him. 

The  Judgment  must  be  reversed  and  a  new 
trial  granted. 

(JKAY  and  GROVER.  .7.T.,  dissented; 
STROX(i,  .T.,  expressed  hhnself  as  inclined 
to  concur,  if  necessaiy  to  a  decision,  but  it 
being  unnecessaiy,  he  reserved  his  judgment. 

.luilgiiient  reversed  and   new   trial  oi'dered. 


WHEN  TITLK  I'ASSK.S. 


165 


SANGER  et  al.  v.  WATERBURY  et  al. 

(23  N.  E.  Rep.  404,  116  N.  Y.  371.) 

Court  of  Appeals  of  New  York,  Second  Divis- 
ion.    Oct.  23,  1889. 

Appeal  from  judgment  of  the  general  term 
of  the  supreme  court,  in  the  second  judu-iai 
department,  entered  upon  an  order  made  I)e- 
cemljer  14,  188G,  wlitcli  atlirmed  a  judyfment 
in  favor  of  the  defendants,  enteied  upon  a 
verdict  directed  by  the  court.  This  was 
an  action  of  rej)]evin  brought  to  recover  the 
possession  of  238  bags  of  coffee  identilied 
and  described  in  the  complaint  as  follows: 
"89  ba<:s,  marked  Xo.  G.  II.  L.  li    &  Co., 

D.  li.  &  Co.;  82  bags,  marked  No.  8,  IJ. 
1j.  B.  &  Co.,  D.  B.  &  Co.;  14  bags,  marked 
No.  10, 11.  L.  B.  &  Co.,  D.  B.  &  Co. ;  2U  bags, 
marked  No.  12,  II.  L.  13.  &  Co.,  D.  B.  &  Co.; 
68  bags,  marked  No.  14,  II.  L.  B.  &  Co.,  D. 
B.  &  Co.;  6  bags,  marked  No.  16,  H.  L.  B.  & 
Co.,  L).  B.  &  Co."'  The  complaint  alleged, 
and  the  answer  admitted,  "that  on  or  about 
the  22d  day  of  July,  1885,  the  said  goo  Is 
*  •■!:  *  were  sold  by  the  plaintiffs  to  the 
defendants  John  K.  Huston  and  James  E. 
Huston,  *  *  *  on  the  credit  of  sixty 
days  for  one-half  thereof,  and  of  ninety  days 
lor  liie  i)alance  Iheieol."  It  appeared  thaltlie 
plaintiffs,  on  the  6th  day  of  -Inly,  1885,  pur- 
chased of  Boulton,  lUiss  &  Dallett  6U5  bags 
of  coffee,  then  stored  with  E.  B.  Bai  tlett  & 
Co.  On  the  22dday  of  July  the  plaintiffs  sold 
the  238  i)ags  of  coffee  hereinbefore  referred 
to  to  J.  K.  Pluston  &  Co.,  of  rhiiadelpiiia. 
That  firm,  on  the  24th  day  of  July,  up- 
on the  security  of  the  coffee  thus  purchase. I, 
borrowed  from  the  defendants  AVaterbnry  it 
Force  S2,300,  and  then  transferred  thecoff  e 
to  them.  On  July  27ih  following,  said  firm 
failed,  making  a  general  assignment.  On 
the  next  day,  the  plaintiffs  commenced  this 
iiction,  by  means  of  whicli  the  <  offee  was 
taken  from  the  possession  of  Waterbury  & 
Force.  The  coffee  then  was,  as  it  had  been 
from  the  time  of  tlie  i)urchase  by  the  plain- 
tiff's, actually  deposited  in  the  warehouse  of 

E.  B.  liartlett  &  Co.,  and  had  not  as  yet  been 
weighed. 

William  W.  troocZrw/i,  for  appellants.  Ed- 
toard  N.  Shapard,  for  respondents. 

Parkeu,  J.,  [after  statL.g  the  facts  as 
rtbore.)  Ttie  appellant  contends  that  the  title 
to  tlie  coffee  in  controversy  did  not  pass  to  J. 
K.  Huston  &  Co.,  and  that  therefore  the  trans- 
fer to  Waterbury  &  Force  di  1  not  vest  in 
them  the  title  or  the  possession.  The  sale 
is  admitted;  but  as  the  coffee  had  to  be 
weighed,  in  order  to  ascertain  the  amount  to 
be  paid  to  plaintiffs,  it  is  insisted  that  the 
title  remained  in  the  plaintiffs.     In  aid  of  this 


contention  is  invoked  the  rule  that  where 
soineihing  remains  to  b;'  done  by  the  seller  to 
ascertain  the  identity,  quantity,  or  quality  of 
the  article  sold,  or  to  put  it  in  the  condition 
which  the  contract  requires,  the  title  remains 
in  the  vendor  until  t!ie  condition  be  com[)lied 
with.  The  appellant  cites  a  numlter  of  au- 
tliorities  whicli,  he  urges,  so  apply  this  rule 
as  to  make  it  ap[)l  caiile  to  the  case  here  pre- 
sented. It  is  said  in  (ir^at  v.  Giie,  51  N.  Y, 
431,  tiiat  this  "rule  has  reference  to  a  sale, 
not  of  specific  property  clearly  ascertained, 
but  of  such  as  is  to  bese|)arate(i  from  a  larger 
quantity,  and  is  necessary  to  be  identified  be- 
fore it  is  suscei)tible  of  delivery.  The  rule  or 
pr.nciple  does  not  apply  where  the  number 
of  the  particular  articles  sold  is  to  be  ascer- 
tained for  the  sole  purpose  of  determining  llie 
total  value  tiiereof  at  certain  speciiied  rates, 
or  a  designated  fixed  price."  This  distinc- 
tion is  recognized  and  enforced  in  Crofoot  v, 
Bnnett,  2  N.  Y.  258;  Kimberlv  v.  Palchin, 
19  N.  Y.  330;  lirailley  v.  Wheeler,  44  N.  Y. 
495.  In  Crofoot  v.  Bennett,  su|)ra,  the  court 
say:  "If  the  goods  sold  are  clearly  identified, 
then,  although  it  may  be  neces-ary  to  num- 
ber, weigh,  or  measure  them,  in  order  to  as- 
certain what  would  be  the  price  of  the  whole 
at  a  rate  agreed  upon  b-tween  the  parties,  the 
title  will  i)ass."  This  expression  of  thecourt 
is  cited  with  approval  in  Burrows  v.  Wliita- 
ker,  71  N.  Y,  291,  in  which  case,  after  a  full 
discussion  of  the  authorities,  the  court  ap- 
proved the  rule  as  laid  down  in  Gro  it  v. 
Oile,  supra.  Now  applying  that  rule  to  the 
facts  in  this  case,  nothing  remained  to  be 
done  in  order  to  identify  the  goods  sold;  be- 
cause while,  out  of  a  larger  lot,  238  b.igs  of 
coffee  Were  disposed  of,  nevertheless,  as  ap- 
pears from  the  complaint  and  the  testimony 
adduced,  the  bags  were  so  marked  that  there 
was  no  dithculty  about  identifying  tlie  par- 
ticular bags  sold.  There  remained,  there- 
fore, nothing  to  be  done  except  to  weigh  the 
coffee  for  the  purpose  of  ascertaining  the  pur- 
chase price;  for  whefher  the  238  bags  of  cof- 
fee should  prove  to  weigh  more  or  less  than 
the  parties  anticipated  was  not  of  any  con- 
sequence. Whatever  should  prove  to  be, 
for  that  number  of  pounds  J.  K.  Hus- 
ton &  Co.  had  agreed  to  ]iay.  This  case, 
therefore,  does  not  come  within  the  rule  con- 
tended for  by  tile  appellants,  liut,  ins  ead,  is 
governed  by  the  principle  enunciated  inGroat 
V.  Gile.  Having  reached  the  conclusion  that 
the  title  and  the  possession  passed  to  J  K. 
Huston  &  Co.,  it  becomes  unnecessary  to 
consider  any  of  the  other  (juestions  discussed, 
for  the  plaintiffs  are  without  title  upon  which 
to  found  the  riglit  to  maintain  an  action. 
Tlie  judgment  a])pealed  from  should  be  af- 
firmed.    All  concur. 


IGO 


AVIIKN  TITLE   PASSES. 


MALTBY  ct  ill.   V.   PLIM^MEU. 

(40  X.  W.  :'>.  71  Mich.  .178.) 

Siiprcinc  ("nurl   nt"  Michigan.      Oct.   19,   1888. 

Vatoi  to  liicuit  court,  Kay  oouuty;  S.  M. 
<Jioou,  Jvidji'*'. 

Two  actions  of  assumpsit,  by  Alvin  Maltby, 
AY.  IrviiifT  lirothertou,  Henry  N.  Watrous,  and 
Orvillt'  A.  Watrous.  assignees  of  Sniilli  c^c  Guil- 
fonl.  to  recover  money  due  on  a  lumbering 
<;ontract.  The  actions  were  consolidated  and 
tried  by  a  jury.  Verdict  for  plaintiffs  for 
$11,080.77,  and  judgment  thereon.  Defend- 
atit  brings  error. 

Tarsuey  &  Weadock.  (T.  A.  E.  &  J.  C.  Wea- 
dock,  of  counsel.)  for  plaintiff  in  error.  J.  L. 
Stoddard,  (B.  Hanchett.  of  counsel.)  for  de- 
fendants in  error. 

LONG.  J.  The  plaintiffs  began  two  suits 
in  the  circuit  court  for  the  c-ounty  of  Bay 
ngainst  the  defendant  on  the  Kith  day  of  No- 
A-ember,  188;;.— one  by  declaration  containing 
the  connnon  counts  only,  and  to  which  deela-  ' 
ration  was  appended  a  copy  of  a  promissory 
note  given  by  defendants  to  plaintiffs  on  Sep-  j 
tember  2,  188(j.  for  $2.1G4.11,  payable  30  days 
after  date,  and  the  other  by  sununons,  in 
wliich  a  declaration  containing  two  special 
counts  and  also  the  common  counts  were  after- 
wards tiled.  These  two  suits  were  tried  as 
one  case.  In  these  special  coimts  a  copy  of 
a  contract,  dated  .July  17,  188o.  made  between 
Smith  &  Guilford,  plaintiffs'  assignors,  and 
the  defendant  is  set  forth.  This  contract  pro- 
vides substantially:  (1)  Said  second  parties 
[Smith  &  Ciuilford]  agree  that  they  will  skid, 
haul,  and  deliver  upon  the  cars  of  the  ^lichi- 
gan  Central  Railroad  Company  at  the  Oge- 
maw village  switch  at  Ogemaw  village,  Oge- 
maw county.  iNIich..  all  the  merchantable 
white  pine  logs  that  said  tirst  party  shall  deem 
proper  for  the  Saginaw  market,  situate  and  be- 
ing upon  sections  21  and  28,  town  22  N.,  range 
1  E..  INIichigan,  at  and  for  the  price  of  !f2..j0 
per  thousand  feet.  Also,  that  they  would 
skid,  haul,  and  deliver  at  the  mill  of  said  first 
party  [.Mr.  I'luunner]  at  Ogemaw  village  afore- 
said, all  the  remainder  of  the  white  and  Nor- 
way pine  and  hemlock  standing  and  being 
v-jxiu  said  sections,  at  and  for  the  price  of 
$2.:i0  per  thousand  feet;  (2)  that  they  will  de- 
liver said  logs  in  sufficient  quantities  to  lieep 
the  saw-mill  of  said  tirst  party  constantly-  sup- 
plied with  logs  for  sawing  purposes  at  Oge- 
maw village,  and  place  the  same  upon  skids 
iit  said  mill,  keeping  logs  of  particular  lengths 
l)y  themselves;  (o)  tliat  they  will  deliver  of 
said  logs  re<iuirrd  b>  said  first  party  for  the 
Saginaw  market  not  less  than  three  million, 
nor  more  than  five  million,  feet  betAveen  the 
date  of  this  contract  and  the  1st  day  of  De- 
cem])er,  A.  D.  188.j;  (4)  that  he  Avill  suspend 
operation  from  said  1st  day  of  December  next 
imtil  the  1st  day  of  April,  1880,  or  until  said 
first  party  shall  have  time  to  cut  and  save 
sudi  timber  as  may  have  been  damaged  by 
fire  upon  lauds  OAvned  by  him  in  the  neighbor- 


hood of  said  above  sections;  (.j)  tliat  he  will 
board  tlie  men  of  said  first  party  engaged  in 
cutting  said  timber  free  ot  cost;  ((!)  that  they 
Avill  do  all  such  Avork  in  a  good  and  Avork- 
manlike  manner  and  use  all  due  diligence  in 
delivering  and  forwarding  the  timber  intended 
by  first  party  for  the  Saginaw  market  upon 
the  reconunencement  of  operations  in  the 
spring  of  ISSO  and  thereafter.  In  consider;i- 
tion  Avhereof  first  party  agrees:  (1)  that  lie 
Avill  pay  said  second  parties  for  skidding, 
hauling,  and  delivei  ing  logs  intended  for  Sag- 
inaw market,  ip2..")0  per  thotisand  feet,  etc.;  (li) 
tliat  he  will  allow  said  second  parties  tlie  use 
of  all  the  railroad  cars  and  ecpiipments  uoaa^ 
belonging  to  said  railroad  running  to  and  from 
said  lands  to  do  sut'li  Avorlc;  (.'>)  that  he  Avill 
cut  a  sufficient  amount  of  timber  from  said 
lands  per  day  to  mutually  assist  said  second 
parties  in  doing  said  AA'ork,  and  keep  said  mill 
supplied  Avith  logs,  and  that  he  Avill  keep  a 
sufficient  space  clear  for  the  unloading  of  tlie 
same,  and  the  care  of  such  logs  after  unload- 
ed, so  as  not  to  delay  said  second  parties  in 
deliA'ering  tlie  same.  The  logs  AA'ere  to  be 
scaled  by  a  competent  scaler  to  be  agreed  up- 
on by  the  parties,  each  party  to  pay  one-half 
of  scaler's  Avages.  This  contract  was  signed 
by  defendant  Plummer  and  by  Smith  &  Ginl- 
ford.  The  defendant  pleaded  the  general  is- 
sue, and  gave  notice  of  set-off,  and  also  notice 
of  several  matters  of  defense.  Tlie  parties 
sulisequently  entered  into  a  stipulation  cover- 
ing certain  matters  of  account  and  showing 
that  the  plaintiffs  and  their  assignors  had 
earned  in  skidding,  hauling,  and  delivering 
logs,  .1;.j2,.570  02 

Due  plaintiffs  for  camp  supplies 
and  due  bills 339  14 

For  certain  items  of  interest  and 
protest  fees 86  13 


Making  a  total  for  Avhich  plain- 
tiffs Avere  entitled  to  credit  of. .  .i!.32.99o  29 

The  amount  for  which  it  AA'as  stip- 
ulated tlie  defendant  is  entitled 
to  credit  is .?41,890  88 


Thus  leaving  a  balance,  oxclti- 
siA'e  of  interest,  prima  facie 
due  the  plaintiffs  according  to 

stipulation,  of ..$11,104  41 

In  addition  to  this  balance  and  interest  there- 
on the  plaintiffs  claimed  in  tlieir  declaration 
and  at  the  trial  damages  for  the  increased  ex- 
pense i-Q  skidding  occasioned  by  the  manner 
in  Avhich  tlie  cutting  was  done  by  the  defend- 
ant in  skipiiing  or  moving  about  from  place  to 
place  instead  of  ctitting  tlie  timber  stibstan- 
tially  clean  as  the  Avork  progressed,  Avliich  it 
Avas  claimed  is  the  usual  and  customary  man- 
ner in  Avliicli  timber  is  cut  upon  lands  that  are 
being  luml)ered.  The  plaintiffs  also  claimed 
damages  laused  by  the  alleged  failure  of  the 
defendant  to  "keep  a  sufficient  space  clear  for 
the  unloading"  of  the  logs,  and  to  take  care 
of  them  "after  unloaded,  so  as  not  to  delay 
said   second    party    in   delivering   tlie   same." 


WHEN  TITL5  PASSES. 


1G7 


Thoy  also  claiiued  damages  for  alleged  failure 
of  defeudant  at  certain  times  to  cut  tlie  tim- 
ber fast  euougli  to  euable  them  properly  to  do 
the  work,  but  no  qu-^stiou  arises  upon  this 
branch  of  the  case.  The  declaration  alleges 
the  assignment  of  the  contract  declared  upon 
from  Smith  &  Uuilford  to  the  plaintiffs.  De- 
fendant, in  his  notice  of  recoupment,  alleged 
and  insisted  upon  the  trial  that  plaintiffs  and 
their  assignors  did  not  perfonn  the  contract 
stied  upon;  that  they  failed  and  neglected  to 
load  o.OOOXHH)  feet  of  logs  for  the  Saginaw 
market  before  December  1,  18S.j;  that,  by  rea- 
son of  the  default  in  the  delivering  of  said 
logs  for  the  Saginaw  market,  the  expense  of 
hauling,  taking  care  of,  and  receiving  them 
was  hugely  increased;  that  they  failed  and 
neglected  to  deliver  on  the  cars  of  the  Michi- 
gan Central  Railroad  Company  at  Ogemaw 
village  all  the  white  pine  saw  logs  suitable  for 
the  Saginaw  market,  but  on  the  contraiy  de- 
livered logs  that  were  coar.se  and  unsuitable 
for  the  Saginaw  market,  thereby  increasing 
the  expense  of  handling  the  coarse  logs,  in- 
cluding the  freight,  to  a  large  amount;  that, 
by  the  admixture  of  coarse  logs  with  the  white 
pine  logs  suitablp  for  the  Saginaw  market,  it 
depreciated  the  value  of  the  logs  suital)le  for 
the  Saginaw  market  to  a  large  amount;  that 
they  failed  and  neglected  to  furnish  a  suffi- 
cient quantity  of  logs  to  keep  defendant's  mill 
rimning.  and  by  reason  thereof  defendant  was 
compelled  to  and  did  shut  down  his  saw-mill 
at  Ogemaw  village  a  large  number  of  times, 
and  was  compelkd  to  keep  a  large  crew  of 
men  idle,  and  wa.'>  thereby  unable  to  put  upon 
the  market  his  said  lumber,  and  was  unable  to 
till  his  orders  or  perform  contracts  eutere;3  into 
by  him,  and  thereby  lost  great  gains  and 
profits;  that  they  did  not  regard  the  terms 
of  said  contract  whereby  they  agreed  to  keep 
logs  of  particular  lengths  upon  skids  by  them- 
selves at  defendant's  saw-mill,  but  that  they 
piled  upon  skids  at  the  mill  of  defendant  logs 
of  all  lengths,  including  hard  wood,  hemlock, 
and  pine,  both  Avhite  and  Norway;  that  at 
tlie  time  of  making  said  contract,  and  during 
its  continuance  the  defendant  was  engaged  in 
the  manufacture  of  special  bills;  that  his  mill 
is  what  is  known  as  a  special  bill  timl)er  mill; 
that  it  was  in  the  contemplation  of  the  tilling 
of  such  special  orders  that  the  contract  de- 
clared on  was  entered  into,  and  that  plaintiffs 
and  their  assignors  had  full  knowledge  of  these 
facts,  and  that  by  reason  of  their  failure  to 
so  pile  said  logs  he  was  compelkd  to  saw  his 
logs  into  lumber  of  misc-ellaneous  lengths,  and 
was  unable  to  till  special  orders  and  con- 
tracts, and  was  compelled  to  cancel  ntimerous 
contracts  and  orders  entered  into  by  him:  that 
the  lumber  manufactuitd  from  the  logs,  by 
reason  of  being  so  mixed  and  sawed  into  mis- 
cellaneous lengths,  was  rendered  almost  value- 
less; that  he  was  deprived  of  great  gains  and 
profits  he  would  have  enjoyed  had  logs  cf  par- 
ticular lengths  bten  piled  at  his  said  saw-mill 
in  separate  lengths  from  each  other;  that  by 
reas(m  of  the  admixture  of  the  loirs  he  was 


compelled  to  and  did  ship  a  large  quantity  of 
the  lumber  green  which  brought  a  much  small- 
er ijrice  by  reason  of  liaving  been  placed  on 
the  market  green,  and  the  cost  of  transporta- 
tion was  greatly  increa.sed;  that  they  did  not 
remove  to  defendant's  mill  at  Ogemaw  a  large 
quantity  of  .saw  logs  cut  dean  by  them  as  they 
went,  but  left  a  large  amount,  about  2.0U0,- 
CHX)  feet,  on  the  skids  in  the  woods  and  on 
the  ground,  which  by  reason  of  being  so  left 
subject  and  exposed  to  the  weather  became 
rotten,  worm-eaten,  and  greatly  damaged;  that 
a  large  quantity,  some  .j(JU,(JOO  feet  of  said 
logs,  by  reason  of  being  so  left  in  the  woods, 
was  burned  by  forest  tires.  Defendant  fur- 
ther claimed  that  neither  plaintiffs  nor  their  as- 
signors built  a  suitable  and  proper  railroad 
track  and  si)urs  in  suitable  pbices,  but  at- 
tempted to  constioict  a  railn-ad  track  and  spurs 
over  which  to  convey  said  logs  from  said  land 
in  unsuitable,  improper  and  imi)racticable 
places;  that  a  portion  of  said  niilroad  track 
and  spurs  was  abandoned  and  could  not  be 
used;  that  other  tracks  and  spurs  were  built 
in  their  stead,  and  that  while  attempting  to 
operate  sjtid  imperfect  ard  improperly  con- 
structed railroad,  large  quantities  of  said  saw 
logs  accumulated  along  the  liiie  of  said  rail- 
road track  and  spurs,  and  were  there  left  and 
abandoned  and  by  reason  thereof  became 
valueless  to  defendant;  that  the  plaintiffs  and 
their  assignors  failed  to  properly  use  and  man- 
age a  certain  steam  locomotive  lielonging  to 
defendant,  and  included  in  the  terms  of  the 
contract  declared  upon;  that  said  locomotive 
was  injured  and  damaged,  and  that  in  all.  by 
reason  of  the  neglect  and  failure  of  the  plain- 
tiffs and  their  assignors,  defendant  was  dam- 
aged to  the  amount  of  .S.lo.iMj*!.  The  jury  re- 
turned a  verdict  in  favor  of  the  plaintifts  for 
the  sum  of  .S11,0S(,».7T,  and  defendant  brings 
eiTor. 

The  record  contains  substantially  all  the  evi- 
dence in  the  case.     The  case  was  ftilly  submit- 
ted  by   the   court    to    the   jury   upon    the    re- 
spective  claims    of  the  parties    for    damages 
growing  out  of  this  contract  imder  the  special 
counts  of  the  declaration.     It  is  now  claimed 
by    defendant's    counsel    that    the    stipulated 
amount,  aside  from  these  re.*;pective  claims  for 
damages,  being  .$11,104.41.  is  so  near  to  the 
amount  cf  the  verdict  rendered  by  the  jury  of 
$11.0S(J.77,  that   it   is  evidence  that   the  jury 
did   not  allow   damages   to  the  plaintiffs   un- 
der their  declaration,  nor  did  they  allow  any 
damages  by  way  of  recoupment  to  the  defend- 
ant  in   finding   the  amount   of  their   verdict. 
I  One  hundred  and  fifteen  errors  are  assigned. 
I  The  case  was   very   fully   tried,   and   a    large 
i  number  of  witnesses  exanuued.   and  a   large 
I  amount   of  testimony  taken.     The  ch-irge   of 
;  the  couit  is   very  full  and   explicit   upon  the 
claims  of  the  resjiective  parties.     Some  :;o  of 
the  a.ssignmeuts  of  error  relate  to  the  refusal 
I  of  the  court  to  permit  certain  questions  put 
either  upon  tlie  direct  examination  of  defend- 
I  ant's  own  witnesses  or  upon  the  cross-examina 
j  tiou  of  plaintiffs'   witnesses  to   be  answered. 


168 


WHEN  TITLE   PASSES. 


iiad  some  4!)  of  the  assisnments  of  error  relate 
to  the  admission  of  evidence  offered  by  phiiii- 
tiffs  under  objection  of  defendant's  counsel. 
The  other  assij,Minieuts  of  error  relate  to  the 
refusal  of  the  cnurt  to  charge  as  requested  by 
defendant's  counsel  and  to  the  charfre  as  giv- 
en. At  the  close  of  the  testimony  the  defend- 
ant reciuested  the  court  to  charge  the  jiu'y: 
"First.  By  th(>  terms  of  the  contract  between 
Smith  &  Guilford-  and  the  defendant  dated 
July  17.  18S."),  Smith  &  Guilford  were  bound 
to  delivi'r  upon  the  cars  of  the  Michigan  Cen- 
tral Kailioad  at  Ogemaw  village  switch  all  the 
merchantable  white  pine  on  sections  twenty- 
one  and  twenty-eight,  town  twenty-two  north, 
range  one  east,  that  defendant  should  deem 
])roper  for  the  Saginaw  market.  If,  from  the 
evidence,  you  find  that  Smith  &  Guilford  or 
Itlaintiffs  delivered,  among  the  white  pine  logs 
that  defendant  deemed  proper  for  the  Saginaw 
market,  against  the  protest  of  the  defendant, 
coarse  and  cull  logs  that  defendant  did  not 
deem  proper  for  the  Saginaw  market,  the  de- 
fendant is  entitled  to  recover  such  damages  as 
he  sustained  by  reason  of  such  default."  Er- 
I'or  is  assigned  upon  the  refusal  of  the  court  to 
give  this  request  in  charge  to  the  jury  specifi- 
cally. The  court,  in  its  general  charge  to  the 
jury,  fully  covered  this  question,  and,  as  we 
think,  vei'y  fairly.  Among  other  things  in  re- 
lation to  this  part  of  the  case,  the  court  stated 
to  the  jury:  "Under  this  contract  both  par- 
ties had  a  duty  to  perform.  Mr.  Pluramer 
would  have  no  right  to  come  in  here  and  say: 
■I  deem  certain  logs  proper  for  the  Saginaw 
market  and  certain  other  logs  not  proper  for 
that  market,  but  these  plaintiffs  delivered  logs 
that  I  deem  not  suitable  for  that  market,'  and 
claim  damages  unless  he  shows  that  he  had 
indicated  to  them  in  some  proper  manner  what 
logs  lie  did  deem  suitable  for  that  market. 
*  *  *  If  these  men,  in  violation  of  their  con- 
tract and  their  good  judgment,  and  the  judg- 
ment which  they  ought  to  have  applied  to  the 
distinction  which  he  pointed  out  to  them  as 
their  guide,  if  they  disi'egarded  it,  and  sent 
legs  to  Saginaw  that  they  had  reason  to  sup- 
pose Mr.  Plummer  did  not  deem  proper  for 
that  market,  then  they  are  liable  for  the  con- 
sequences and  the  damages  that  resulted  to 
him  from  securing  that  kind  of  logs  there. 
But  if  he  left  it  to  the  judgment  of  these 
men.  and  these  men  exercised  that  judgment 
fairly  and  honestly,  he  must  be  bound  by  that 
judgmcMit.  But  if  they  frequently  disregard- 
ed his  directions,  and  did  put  timber  upon  the 
cars  and  send  it  to  Saginaw  that  they  knew 
was  not  .suital)le  for  that  market,  and  knew 
that  he  deemed  unsuitable,  then  they  ought 
to  pay  damages."  It  is  clear  oy  tne  contract 
that  defendant  was  required  to  designate  the 
logs  which  were  to  go  to  Saginaw.  He  should 
do  it  in  such  manner  as  it  would  be  profitable 
for  plaintiffs  to  work  by.  If  he  left  it  to  plain- 
tiff.s'  judgment,  or  to  the  judgment  of  the  scal- 
er or  foreman,  and  gave  only  a  general  de- 
scription, so  that  it  involved  judgment,  and 
that  judgment  was  fairly  exercised,  he  could 


not  complain,  and  we  think  this  part  of  the 
charge  fully  covered  all  that  defendant  had 
any  right  to  ask.  Defendant  further  requested 
the  court  to  charge:  "If  you  find  from  tbe 
evidence  that  plaintiffs'  assignors  did  not  keep 
defendant's  mill  at  Ogemaw  village  constant- 
ly supplied  with  pine  logs  for  sawing  purposes, 
the  defendant  is  entitled  to  all  damages  sus- 
tained by  him  by  reason  of  such  failure." 
This  the  court  also  refused  to  give.  The  claim 
made  by  the  notice  under  his  plea  does  not  set 
forth  any  particular  bills  lost.  His  claim  is- 
that  he  might  have  obtained  orders  for  special 
bills.  He  does  not  name  a  single  bill  which 
he  thus  failed  to  get.  The  claim  is  presented 
in  no  other  than  the  most  speculative  waj-,  and 
does  not  present  a  fact  to  be  tried  as  to  dam- 
ages. The  court  instructed  the  jury  tipon 
this  question,  and  we  find  no  eiTor  in  those  in- 
structions. The  case  in  principle  falls  direct- 
ly within  the  ruling  of  this  court  in  Allis  v. 
McLean,  48  INIich.  428,  12  N.  W.  640.  De- 
fendant further  requested  the  court  to  cnarge 
the  jury:  "Keeping  logs  of  particular  lengths 
by  themselves  in  the  contract  of  .Tuly  17,  1885, 
means  that  logs  of  different  lengths  should  be 
placed  on  skid-ways  at  defendant's  mill,  each 
length  sepaiate  fi-om  every  other  length.  As 
an  illustration,  all  logs  twelve  feet  in  length 
together,  all  logs  fourteen  feet  in  length  to- 
gether, and  so  on  throughout  the  varioois 
lengths  of  logs  under  the  contract.  If  they 
were  not  delivered,  so  that  logs  of  particular 
len.gths  were  kept  by  themselves,  the  defend- 
ant is  entitled  to  recover  damages  by  reason 
of  this  breach  of  the  conti'act."  The  conten- 
tion of  the  defendant  is  that  the  random  logs, 
that  is  logs  of  different  lengths,  though  cut 
for  bill  stuff,  should  have  been  separated  by 
their  lengths  at  the  mill,  and  put  on  different 
skid-ways  at  the  mill,  and  because  that  was 
not  done  the  defendant  has  suffered  damages 
which  he  is  entitled  to  recover.  The  contract 
cannot  be  so  con.strued,  and  it  is  apparent  from 
the  conduct  of  the  defendant  and  his  employes 
that  no  such  construction  was  thought  of  at 
and  during  the  time  the  Avork  was  in  progress. 
The  logs  cut  varied  in  length  from  12  to  36 
feet,  and  it  would  have  required  13  different 
skid-ways  at  the  mill  to  place  separately  these 
different  lengths  of  logs.  It  was  the  duty  of 
defendant  to  provide  these  skid-ways,  and  as 
appears  by  the  evidence  only  two  were  pro- 
vided for  long  timbers,  and  defendant's  fore- 
man directed  them  placed  on  these  skid- 
ways.  The  language  of  the  contract  itself  does 
not  bear  any  such  construction.  The  lan- 
guage in  the  contract  "keeinng  logs  of  particu- 
lar lengths  by  themselves"  was  employed  to 
designate  a  class,  and  conveys  the  same  idea 
as  the  Avords  "special  lengths."  If  the  intent 
had  been  to  keep  each  length  of  logs  by  itself, 
that  language  would  have  been  used.  It  is 
an  idea  easy  to  express.  The  actual  business 
of  lumbering  about  which  the  contract  was 
made  does  in  fact  make  use  of  two  genei'al 
classes,  viz.,  the  usual  or  customary  lengths, 
which  are  from  12.  to  22  feet,  and  cut  so  as 


WHEN  TITLE   PASSP:S. 


109 


to  save  tiiiil)er,  and  loii;;tlis  wliicli  are  cut 
with  reference  to  particular  bills  or  orders. 
There  can  be  no  doubt  that  it  was  intended 
by  the  contract  that  the  logs  for  bill  stuff 
should  be  kept  by  themselves  and  the  other 
classes  of  lojjs  by  themselves.  This  was  the 
interpretation  jjiven  by  the  court  to  the  cou- 
tract.  and  we  think  it  is  the  true  construction. 
Some  contention  was  had  upon  the  trial,  and 
considerable  evidence  intrcMluced  by  ea(;h  pw- 
ty.  under  a  claim  made  l)y  the  plaintiffs  that 
the  defendant,  in  cutting  the  timber,  did  not 
do  so  in  the  usual  and  ordinary  way,  but  went 
from  place  to  place  so  that  plaintiffs  were  put 
to  lartje  exi)ense  in  hauling.  There  is  no  pro- 
vision in  the  contract  as  to  the  manner  in 
which  the  plaintiffs  should  do  the  work  ex- 
cept that  it  should  be  done  in  a  workman- 
like manner,  and  keep  the  mill  supplied.  The 
defendant  was  to  do  the  cutting  in  such  man- 
ner as  to  mutually  assist  the  plaintiffs  "in  do- 
ing the  work  and  keeping  the  mill  supplied." 
Under  these  terms  it  was  no  matter  how  fast 
logs  were  cut,  or  what  kinds.  The  plaintiffs 
fulfilled  by  keeping  the  mill  supplied  with 
every  kind  of  logs,  and  might  elect  for  them- 
selves which  kind  to  load  tirst  and  from  what 
point.s  to  work  to  the  best  advantage  for  them- 
selves. The  defendant  claimed  the  right  to 
ski])  about,  cut  here  and  there,  and  compel 
hauling  lu  the  same  way.  'I'lie  plaintiffs  de- 
nied this,  and  claimed  that  it  added  to  the 
expense  in  hauling.  The  contract  was  made 
in  reference  to  the  work  of  logging  as  actually 
and  customarily  done,  unless  it  could  be  oth- 
erwise shown  by  competent  evidence.  The 
IJlaintiffs  gave  evidence  tending  to  show  the 
custom  was  to  cut  clean.  The  defendant  gave 
evidence  tending  to  show  an  understanding, 
before  and  when  the  contract  was  made,  to 
cut  as  he  did.  The  plaintiffs  gave  evidence 
in  rebuttal,  and  the  whole  question  was  sub- 
mitted to  the  jury  by  the  court  in  its  general 
charge,  and  gave  the  defendant  the  benefit  of 
this  understanding  if  they  so  found.  We  think 
the  matter  was  fully  and  fairly  submitted  to 
the  jury,  and  the  defendant  has  no  reason  to 
complain  of  this  part  of  the  case.  The  de- 
fendant reciuested  the  court  to  charge:  '"If 
j-ou  find  from  the  evidence  that  defendant,  by 
order  of  (Juilford,  paid  to  Angus  Bedour  the 
sum  of  .$(>ir>.:J2  for  work  done  by  him  for  Guil- 
ford under  verbal  contract,  between  defendant 
and  Guilford,  the  defendant  is  entitled  to 
credit  for  such  amount  as  payment."  The 
court  refused  this  request,  but  charged  the 
jury,  substantially:  "Here  is  an  amount 
claimed  to  have  been  paid  by  Mr.  Phimmer  to 
Bedcur  for  skidding  a  quantity  of  logs  that 
Mr.  Guilford  was  under  contract  to  get  out. 
The  claim  is  for  payment  made  by  defendant  \ 
for  loading  these  logs.  It  is  conceded  that 
Mr.  riummer  did  pay  for  the  skidding  and 
hauling.  Tlie  only  dispute  is  whether  he  was 
authorized  to  pay  it.  *  *  *  You  may  have 
no  sort  of  doubt  that  this  payment  was  made 
by  Mr.  Plummer,  who  had  no  sort  of  interest 
i?i  paying  it  to  ^Ir.  Bedour,  because  he  imder- 


stood  his  authority  and  the  direction.  Mr. 
Bedour  may  have  received  it  with  that  under- 
standing, and  it  may  be  supposed  it  is  sug- 
gested that  Mr.  IMummer  would  not  have  paid 
this  man  Bedour  unless  he  thought  and  be- 
lieved he  was  authorized  by  Guilford  to  do  so. 
And  (iuilford's  good  faith  is  attested  in  the 
same  way,  to  a  certain  extent.  He  testified 
that  he  paid  Bedour,  and  Bedour  receivwl 
from  him  some  four  hundred  and  ninety-four 
dollars  of  this  same  amount.  What  you  may 
think  of  Bedour  for  receiving  from  these  two 
parties  double  payment  for  his  labor  is  an- 
other question.  *  *  *"  The  court,  in  an- 
other portion  of  its  charge,  stated  to  the  jury: 
"Assuming  that  these  witnesses  are  equally 
honest,  and  perhaps  you  may  be  satisfied  they 
are,  it  indicates  that  there  was  an  entire  mis- 
apprehension between  the  parties."  It  ap- 
pears from  the  record  that  Plummer  and  Be- 
dourtestitied  that  (Juilford  authorized  this  pay- 
ment, while  Guilford  denied  giving  Plummer 
any  such  authority.  Plummer  testified  that 
he  paid  Bedour  .$()l."i.32  for  loading  the  logs, 
and  that  that  amount  included  nothing  but  for 
logs  loaded  under  the  contract,  and  that  the 
payment  was  directed  by  Guilford  in  the  pres- 
ence of  Bedour.  Mr.  Bedour  testified  that 
Plummer  was  at  Ogemaw,  and  that  he  went 
down  with  him  to  West  Branch.  That  the 
conductor  held  the  train  at  his  reipiest.  He 
went  to  the  hotel,  and  got  Guilford  to  come 
down  to  the  train,  and  talk  the  matter  over 
with  Plummer.  That  Plummer  was  to  pay 
liim.  Mr.  Plummer  asked  Guilford  if  he 
should  pay  Bedour  for  the  Avork.  and  he  said. 
"Yes."  Mr.  Guilford  denied  making  any  such 
statement,  or  ever  authorizing  Plummer  to 
pay  for  loading  those  logs.  The  issue  was 
thus  made  between  the  parties,  and  it  was  a 
question  of  fact  for  the  determination  of  the 
jury.  Defendant's  claim  is  that  the  court 
voluntarily  i^assed  upon  one  of  the  most  im- 
portant questions  of  fact  in  the  case,  and 
clearly  informed  the  jury  what  his  opinion  of 
the  testimony  upon  the  payment  was.  That 
this  statement  of  the  court  was  a  finding  of 
fact  that,  conceding  both  parties  to  be  equally 
honest,  they  misapprehended  each  other.  An- 
other claim  is  also  made  that  defendant's  case 
was  prejudiced  by  the  remarks  of  the  court 
upon  the  witness  Bedour  in  that  the  court 
said,  "What  you  may  think  of  Bedour  for 
receiving  from  these  two  parties  double  pay- 
ment for  his  labor  is  another  question."  as 
Bedour  had  testified  that  he  had  done  other 
work  for  Guilford,  and  that  this  .'i<()l.").;i'J  in- 
cluded no  part  of  the  other  work.  Mr.  Be- 
dour testified:  "This  work  I  did  for  Mr.  Guil- 
ford was  on  that  deal,  for  sections  10  and  11. 
I  had  a  separate  transaction  with  Mr.  Guil- 
ford, apart  from  that,  but  this  was  all  done 
on  sections  10  and  11.  The  payments  that  I 
have  received  from  Mr.  Guilford  and  Mr. 
Phmur.er  pay  me  in  full  for  all  the  work  I 
did  for  Guilford  on  sections  10  and  11.  It 
does  not  overpay  me."  It  is  evident  that 
Bedour's   testimony  was  important  upon  this 


170 


WHEN  TITLE   PASSES. 


^G1.").;JJ  item,  riiiiunu'r  clainicil  to  have  paid 
it  under  authoiitj-  from  tJuilt'ord,  and  claim- 
ed a  credit  for  it  on  this  account.  (Jnilford 
denied  givinj,'  any  such  authority  to  riunnner, 
iind  further  insisted  that  he  had  paid  that 
item  for  the  Identical  work  to  Bedour  him- 
self. Bedour  was  called  by  defendant,  and 
i?ave  testimony  sciuarely  contradictory  to  Guil- 
ford, and  claiminj;;  that,  while  (Jnilford  paid 
liim  the  $Ulu.32,  it  was  for  other  work  done 
for  him,  and  that  what  he  received  from  (Jnil- 
ford and  riuinmer  only  b:ilauced  his  claim, 
and  he  was  not  overpaid.  The  remarks  of  the 
court  "What  you  may  think  of  Bedour  for  re- 
ceiving from  these  two  parties  double  pay- 
ment for  his  labor"  would  naturally  and  nec- 
essarily have  {,'reat  weight  with  the  jniy.  It 
was  an  expressi(m  of  doubt  by  the  court  as 
to  the  honesty  of  Bedour  for  receiving  double 
])ay.  It  must  have  made  an  impression  upon 
The  minds  of  the  .jury,  which  they  would  carry 
into  the  jury-room,  and  where  the  case  was  so 
evenly  balanced  between  Plunnuer  and  Guil- 
ford, who  so  squarely  contradicted  each  other 
upon  the  question  of  the  authority  for  the 
payment.  Betlour's  testimony  was  of  much 
juoment  and  might  be  decisive  of  the  question. 
We  tliink  this  remark  prejudiced  the  defend- 
iiut's  case  upon  this  $(iir>.:j2  item.    We  think. 


also,  tile  coui  t  was  in  eiTor  in  charging  the 
jury  that  there  was  an  entire  misapprehension 
between  the  parties  upon  this  question  of  au- 
thority to  Plunnuer  to  pay  the  !f(;i5.32.  The 
testimony  was  direct  and  positive,  and  plainly 
irreconcilable,  and  it  was  a  (luestion  of  fact  for 
the  jury  to  deternnue  which  was  right.  If 
Plummer  and  Bedour  were  right  in  their  ver- 
sion of  it,  then  Plununer  was  entitled  to  the 
credit,  and  if  (iuilfoid  was  correct,  the  credit 
should  not  liave  been  allowed.  In  view  of  the 
issue  made  in  the  case,  by  the  pleading,  the 
court  allowed  great  latitude  in  the  examina- 
tion of  witnesses.  We  think  this  was  proper, 
and  we  tind  no  error  in  the  record  upon  the 
reception  or  rejection  of  evidence.  The  case 
was  fully  tried  and  submitted  to  the  jury  un- 
der a  very  full  and  fair  charge  by  the  court. 
We  find  no  error  in  the  construction  given  to 
the  contract  by  the  court.  The  only  error  we 
tind  in  the  case  relates  to  this  ii;()l.").32  item, 
and  in  the  charge  of  the  court  upon  that  sub- 
ject we  think  there  was  error.  The  judgment 
of  the  court  below  nmst  be  reversed,  with 
costs,  and  a  new  tri;il  ordered. 

SHERWOOD,   C.   J.,  and  i^riAMPLIX  and 
MORSE.    .I.I.,    concurred.     CAMPBELL,    J., 

did  not  sit. 


WHEN   TITLE  PASSES. 


171 


ALLAUD  V.   (JKl-.ASEUT. 

(01   N.   Y.   1.) 

Commission    of    Appeals    of   Now    York.    Sept. 
Term,   1874. 

Actiou  for  goods  sold  and*  delivered.  De- 
fendant firm  orally  ajireed  with  an  ajient  of 
plaintiffs  to  buy  by  s-aniple  the  foUuwing  bill 
of  hats  and  caps: 

C>f  ease  No.  3U1,  1/2  doz.  (hikl's 
Leghorn  sy  Ivans,  at  .I'll  per 
doz •$  •")  ~>0 

Of  case  No.  312.  one  doz.  harvest 

hats,    at 4  oO 

Of  case  No.  371.  half  doz.  Pana- 
ma hats,  at 28  r>0  a  iloz. 

Of  case  No.  372.  half  doz.  Pana- 
ma   hats,    at 3(5  00  a  doz. 

Of  case  No.  320.  one  doz.  pahn 
leaf  hats,   at 2  oO  a  doz. 

Of  casf  No.  324,  one  doz.  pahn 
leaf    hats,    at 3  ud  a  doz. 

Of  east-  No.  32U,  one  doz.  white 
Gleuwood,    at 1-'.  IK)  a  doz. 

Of  case  No.  159,  one  doz.  black 
Alpine,    at 24  (Mia   doz. 

Of  case  No.  309,  one  doz.  Leg. 
harvest,    at    3  2o  a  doz. 

The  samples  weie  shown  by  the  agent,  and 
the  prices  of  the  different  styles  named,  and  a 
memoraudmu  made  by  the  agent  of  the  num- 
ber of  each  kind  purchased.  No  memorandum 
was  made  in  writing,  and  signed  by  either 
party.  When  the  goods  were  sent,  by  ex- 
press, as  ordered,  defendants  refused  to  re- 
ceive them  because  the  one  dozen  harvest 
were  in  some  slight  particular  different  from 
the  samples  shown.  Defendants  moved  for  a 
nonsuit  because  (1)  "that  the  agreement  under 
which  the  plaintiff's  seek  to  recover  is  within 
the  statute  of  frauds,  and  void;  (2)  that  the 
order  for  the  goods  constitutes  one  entire  con- 
tract, and  the  plaintiffs  have  failed  to  fullill, 
ou  their  part,  to  deliver  the  harvest  hats  of 
the  description  ordered;  that,  by  reason  of 
said  failure,  the  defendants  had  a  right  to 
refuse  to  leceive  any  of  the  goods  sent."  The 
i'ourt  nonsuited  plaintiff's  on  the  last  ground. 

Daniel  Wood,  for  appellants.  Bowen  &  Pitts, 
for  resixiudeuls. 

EAKL.  C.  The  judge  at  the  circuit  regard- 
ed this  as  an  entire  contract  of  sale,  and  not 
severable;  and  if  he  was  right  in  this,  he 
properly  nonsuited  the  plaintiffs  upon  that 
ground.  If  it  was  an  entire  contract,  within 
the  meaning  of  the  law.  the  plaintiff's  could  re- 
cover only  by  showing  entire  performance,  by 
a  full  delivery  of  all  the  articles  purchased. 
But  it  is  not  necessary,  in  this  case,  to  deter- 
mine whether  this  was  an  entire  or  a  severa- 
ble contract,  because  the  defendants  also  mov- 
ed for  a  nonsuit  upon  the  ground  that  the 
contract  of  sale  was  void  under  the  statute  of 
frauds.  Although  the  .iudge  did  not  place  the 
nonsuit  upon  this  ground,  it  may  be  consider- 
ed here.  He  nonsuited  the  plaintiffs,  and  even 
if  he  gave  a  wrong  reason  for  it,  and  placed 
it  upon  the  wrong  ground,  the  mmsuit  may  lie 
upheld  upon  any  ground  appearing  in  the 
case,    Curtis  v.  Hubbard,  1  Hill,  330;    Siuiar 


v.  Canaday,  53  N.  Y.  298;    Deland  v.  Ki<har<l- 
son.  4  Denio,  95. 

Even  if  this  were  a  severable  contract  so  far 
as  relates  to  the  performance  of  the  same, 
within  the  meaning  of  the  statute  of  frauds 
it  is  an  entire  contract.    The  reasons  for  hold- 
ing it  to  be  such  are  clearly  set  forth  in  Baldey 
v.    Parker.   2  B.  &  (.'.  41,  and   Story.   Sales. 
§  241.    This,  within  the  meaning  of  the  stat- 
ute of   frauds,   is  a   contract   for   the   .sale   of 
goods  for  the  price  of  $50  or  more,  and  as 
there  was  no  note  or  memorandum   or  pay- 
ment, the  (luestion  to  be  determined  is,  wheth- 
er the  goods  were  accepted  and  received   by 
the  buyers  so  as  to  satisfy  the  statute.    By 
the  terms  of  the  contract,  the  goods  were  to 
be   delivered   to   the    Merchants'    I'niou    Ex- 
press, to  be   carried   to   the   defendants,   and 
they  were  so  delivered.    It  is  well  settled  that 
when  there  is  a  valid  contract  of  sale,  a  de- 
liv(  ry  to  a  carrier,  according  to  the  terms  of 
the  contract,  vests  the  title  to  the  pi'operty  in 
the    l-uyei-.     It    was    decided    in    liodgers    v. 
Phillips.  40  N.  Y.  519.  that  a  delivery,  accord- 
ing to  the  contract,  to  a  general  carrier,  not 
designated  or  selected  by  the  buyer,  does  not 
cou.stitute  such  a  delivery  and  acceptance  as 
to  answer  the  statute  of  frauds.    But  it  has 
been  heltl  that  when  the  goods  have  been  ac- 
cepted by  the  buyer,   so   as  to   answer   that 
portion  of  the  statute  which  requires  accept- 
ance, a  delivery  to  a  carrier  selec-ted  by  the 
buyer  will  answer  that  portion  of  the  statute 
which  re(iuires  the  buyer  to  receive.    Cross  v. 
O'Donuell,  44  N.  Y.  001.    So  far  as  I  can  dis- 
cover, it  has  never  yet  been  decided  in  any 
case  that  is  entitled  to  respect  as  authority, 
that  a  mere  carrier  designated  by  the  buyer 
can  both  accept  and  receive  the  goods  so  as 
to  answer  the  statute.    Benj.  Sales,  124.    The 
cases  upon   this   subject  are   cited  and   com- 
mented upon,  and  the  principles  applicable  to 
the  question  are  so  fully  set  forth  in  the  two 
recent   cases  above  referred   to  that  no  fur- 
ther citation  of  authorities  or  extended  discus- 
sions  at   this  time  is  important.    It   will   be 
found  by  an  examination  of  the  authorities, 
that  in  most  of  the  cases  where  a  delivery  to 
a   carrier  has  been  held  to  satisfy  the  stat- 
ute   of    frauds,    there   had    been    a    prior   ac- 
ceptance of   the   goods   by  the  buyer  or  his 
agent.     A    buyer     may    accept     and    receive 
through  an  agent  expressly  or  impliedly  ap- 
pointed for  that  purpose.    There  is  every  rea- 
son for  Ik  Iding  that  a  designated  carrier  may 
receive  for  the  buyer,  because  he  is  expressly 
authorized  to  receive,  and  the  act  of  receiv- 
ing is  a  mere  formal  act  requiring  the  exer- 
cise of  no  discretion.    But  there  is  no  reason 
f(u-  holding  that  the  buyer  in  such  case  intend- 
ed to  clothe  the  carrier,  of  whose  agents  he 
may  know  nothing,   with  authority  to  accept 
the  goods,  so  as  to  conclude  him  as  to  their 
quality,  and  bind  him  to  take  them  as  a  com- 
pliance with  a  c-ontiact  of  which  such  agents 
can    know    m  thing.    This    case    furnishes   as 
gcotl  an  ilh.stration  as  any.    The  goods  were 
boxed;    the  carrier  could  know  nothing  about 


172 


WllKX   TITLE   I'ASSES. 


tlicin;  and  its  agonts  had  no  right  to  impac-k 
and  liandlt'  tlicni.  its  soh'  dnty  and  author- 
ity was  to  receive  and  transport  tlieni.  In 
sucli  a  case,  it  Avonld  be  (inite  absurd  to  liohl 
that  tile  earrier  had  an  implied  authority  from 
the  buyer  to  aeeept  the  jioods  Un-  him.  If  the 
buyer  does  not  aeoept  in  person,  he  must  do 
it    rluMu;,'li   an   authoiized   a.^rent.     Here    it    is 


not  elaimed  that  there  was  express  authority 
conferred  upon  the  carrier  to  accept,  and  the 
circumstances  are  not  such  that  such  author- 
ity can  be  implied. 

Upon  this  last  ground  therefore  the  non- 
suit was  proper,  and  the  .judgment  must  be 
afhrmed.   with  costs. 

All  c'in<'nr. 


WllKN   TITLE   PASSES. 


17^? 


Rnir.  ot  al.  V.  COKNEK  .-t  al. 

((■|.S  Mtl.  1T!>.t 

Court  of  Aiipeals  of  .Maiylan.l.      Eoli.  r2.  1SS">. 

Before  ALVEY.  C.  .1..  aiul  YELEOTT. 
STONE.  MILLER.  ROIUXSO.X.  IKVLNHJ. 
ami  BHYAX.  ,1.1. 

W.  Irvine  Cross  and  John  K.  Cowen.  for 
apiu'Ilauts.  Joseph  C.  France  auil  .loim  I'reu- 
tiss  Toe.  for  appellee. 

lUVIXi;.  J.  The  appellee  beinj;  a  i-onunis- 
siou  nierehaut  iu  Baltimore,  between  the 
mouth  of  Autrust.  1S)SL  and  the  mouth  of 
January.  ISJSl*.  rei-elvetl  eonsiunmeuts  of  Iknu- 
from  Oliver  Meriou,  of  Minneapolis.  Minne- 
sota, for  sale  upon  eounuissiou.  Ipou  the 
121st  of  Janiuir.v,  ISSJ.  Meriou  shipiH'd  to  Cor- 
ner &  Co..  without  order,  a  (•ar-U)ad  of  ••Cham- 
pion" tlour.  being  one  hundred  and  twenty- 
tive  barrels,  by  Milwaukee  and  St.  I'aul  Kail- 
road  and  Baltimore  and  Ohio  Kailroad  via 
Chieago.  On  the  same  day  he  wrote  Corner 
&  Co.  advising  of  this  shipment,  and  naming 
a  priee  at  which  Corner,  his  faetor.  shoukl  sell 
the  same.  Xo  bill  of  lading  was  sent  to  Cor- 
ner iV  Co.:  but  at  the  time  of  the  shipment  a 
shipping  receipt  was  taken  from  the  railroail 
for  the  flour,  and  that  with  a  draft  on  Corner 
&  Co.  for  tive  hundred  dollars  was  plaeed  iu 
bank  for  trausndssion  to  Baltimore,  but  was 
subst'(iuently  withdrawn,  and  was  never  sent. 
Subseciuent  to  the  shipment  to  Corner  »S:  Co.. 
Meriou  reeeiveil  an  order  for  tlour  from  Con- 
rad Kuhl  «!c  Son  of  Baltimore,  and  decided  to 
change  the  shipment  and  to  send  to  Kuhl  <.Vr 
Sou  this  car  of  tlour  on  their  oriler.  Accord- 
ingly, on  the  l'4th  of  January.  ISSl'.  the  rail- 
road having  beeu  notihed.  its  agent  at  Minue- 
apolis  telegraphwl  the  Chicago  agent  to  hold 
the  car  of  tlour.  as  Meriou  wished  to  change 
the  consignment  to  Kuhl  &  Son.  On  the  .*Wth 
of  January,  the  original  receipt  was  surren- 
dered to  the  railroad  agent  at  Minneapolis, 
and  a  bill  of  lading  for  the  Hour  was  taken 
out  to  Kuhl  &  Son.  The  agent  on  the  :24th 
had  takeu  steps  to  have  the  address  of  Corner 
&  Co.  removed  from  the  car.  and  to  have  that 
of  Kuhl  ^:  Son  substituted.  lie  telegraphed 
to  Chicago  directing  this  change  to  be  made. 
but  it  was  neglecteil.  and  the  tlour  came 
through  to  Baltimore  labeled  for  Corner  & 
Co..  and  was  delivered  to  them;  the  Balti- 
more agents  of  the  railroad  not  being  adviseil 
of  the  change  of  destination,  and  Corner  & 
Co.  as  yet.  having  received  no  information  of 
]Merion"s  change  of  purpose,  and  the  actual 
consignment,  by  bill  of  lading,  to  Kuhl  «S: 
Son.  The  proof  shows,  that  on  the  l'4th  of 
January,  three  days  after  the  shipment 
spoken  of.  but  before  Corner  knew  of  it,  he 
wrote  to  Meriou  advising  against  further  ship- 
ments unless  Meriou  chase  to  ship  a  car  of 
"Clematis"  flour,  without  draft,  as  the  mar- 
gins on  the  flour  still  on  hand  were  exhaust- 
ed. On  the  2()th  of  January.  Corner  acknowl- 
edged the  receipt  of  the  letter  telling  him  of 
the    shipment    of    "Champion,"    promising    it 


should  be  sold  for  the  best  priti's.  and  say- 
ing, ••we  note  you  have  not  made  draft  on  this 
car.  as  if  in  anticipation  of  our  re<iuest  of  the 
:24th  to  si'ud  us  a  car  without  draft  tt)  cover 
the  margins  on  shipments  now  on  hand." 

Corner  .says  in  the  testimony  he  sold  the 
flour  on  the  !tth  of  Ei-bruary.  although  on  the 
27th  of  February  he  wrote  Meriou  he  had  re- 
ceived no  offers,  and  d<H'S  not  ajiprise  him  of 
a  sale  until  the  4th  of  March. 

The  bill  of  lading,  though  issued  cm  the 
30th  of  January,  w.is  datnl  kick  to  the  I'lst 
of  January  to  correspond  with  the  actual  ship- 
ment. This  bill  of  lading  in  favor  of  Kuhl  A: 
Son.  with  draft  on  them  for  !F<il"».  was  pre- 
sented by  Meriou  to  the  Seciuity  Bank  of 
^liimesota.  and  the  draft  was  t-ashed  by  the 
bank,  which  sent  both  bill  of  lading  and  draft 
to  the  Bank  of  Commerce  in  Baltimore,  at 
which  bank  Kuhl  &:  Son  paid  the  draft  and 
received  in  cousideraticu  of  such  iKiyment. 
viz..  the  bill  of  lading  for  the  flour.  Ascer- 
taining the  flour  had  beeu  received  by  Cor- 
ner. ai)pellauts  iu  the  latter  part  of  February, 
or  early  in  March,  tleuianded  payment  for  tlie 
.sjune;  and  the  Baltimore  and  Ohio  Kailroad 
also  in  March  ih'inaudt'd  the  flour. 

ll)on  this  state  of  facts  the  (luestion  arises, 
who  was  entitled  to  this  tlour— the  appellants, 
or  the  appelkH'V  It  is  conceded  that  no  bill  of 
lading  or  invoice  was  ever  sent  to  or  received 
b.v  Corner:  whereas  it  is  ecpially  well  estab- 
lished and  not  denied,  that  Kuhl  iV:  Son  did  re- 
ceive a  .all  of  lading,  and  did  pay  a  draft  on 
them  for  ."f(iir»  on  it. 

The  ai)pellauts  insist,  that  although  the 
flour  was  originally  shipptnl  to  Corner  vV:  Co.. 
it  was  so  shipi)ed  without  their  order,  and 
that  afterwards,  and  while  it  was  in  the  pow- 
er of  the  shipper  to  ilo  so,  the  consignnu'Ut 
was  changed,  and  the  flour  was  sold  to  Uuiil 
&  Sons,  to  whom  a  bill  of  lading  and  draft 
were  st>nt.  and  who  paid  therefor.  They  claim 
that  title  nevi>r  passt'd  from  Meriou  to  Cor- 
ner iV:  Co..  but  that  it  did  pass  to  Kidil  \; 
Son.  The  appellants  furtlu'r  and  strongly  re- 
lied on  the  act  of  lS7t;.  c.  -<>2.  in  respei-t  to 
bills  of  lading,  and  the  effect  of  the  posses- 
sion of  svch  bills  of  lading  upon  title.  But 
the  di'cision  of  this  case  does  not  involve  any 
consideratitui  by  the  court  of  the  effect  of  the 
act  of  1S7(;  or  what  construction  shall  be  giv- 
en it:  for  there  are  well  settled  principles  es- 
tablished and  acted  upon  in  very  many  eases, 
which  will  contrid  the  decision  of  this  case  ir- 
respective of  any  act  of  assembly. 

It  is  the  well-settled  law.  that  the  delivery 
of  goods  to  a  CHumuou  carrier  for  one  who  has 
purchased  and  who  has  oidered  them,  is  a  de- 
liver.v  to  the  purchaser,  though  it  does  not 
amount  to  an  acceptance  of  them.  1  IW'Uja- 
min  on  Sales,  pp.  LS'J  and  !!>.">.  But  it  is 
equally  well  settled,  that  where  goods  have 
been  shipped  to  one  who  has  not  ordertnl 
them,  title  does  not  i)ass  to  the  consignee  by 
delivery  to  the  carrier,  and  the  right  to  change 
the  consignment  and  destination  during  the 
transportation   remains    iu   the   shipi)er;     and 


174 


AVilEN   TITLE    I'ASSES. 


this  is  so  far  tlie  manifest  reason  that  there- 
is  a  \vant  of  the  essential  element  of  nnitiial 
assent  to  eonstitnte  a  contract  of  sale.  So 
that  in  all  cases  where  ^oods  are  shipiit  d  upon 
the  account  of,  and  at  the  risk  of,  the  sliipper, 
tills  rijilit  remains  in  him.  The  Francis  (Hoy- 
er.  Master,)  S  Crauch,  418;  Mitchel  v.  Ede,  11 
Adol.  iVc  E.  SSS;  Scothorn  v.  Railway  Co.,  8 
Exeh.  ;3-l();  8  Pet.  Cond.  Rep.  U.  S.  245,  and 
notes;  Elliot  v.  Bradley.  2:^  Yt.  217;  Ilodjjes 
V.  Kimball,  4iJ  Iowa,  577;  Hutch.  Carr.  SS 
134,  ;5;^7;  Blanchard  v.  I'age,  8  Gray,  285; 
and  AValter  v.  Ross,  2  Wash.  C.  C.  28(J.  Ved. 
Cas.  No.  17,122.  In  this  last  case  of  Walter 
V.  Ross,  the  subject  was  fully  considered,  and 
.hulse  Washinf;ton  says,  "the  factor  has  no  in- 
terest or  prcjiierty  in  the  ^oods  beyond  his 
commissions,  and,  of  course,  cannot  contro- 
vert the  riylit  of  his  principal.  If,  indeed,  he 
be  a  creditor  of  the  shipper,  he  has  a  coutin- 
sent  interest  in  virtue  of  his  risht  of  lien 
which  the  possession  would  give;  but  for  the 
perfection  of  his  right  he  must  acquire  and  re- 
tain an  actual  possession  of  this  property — 
constructive  possession  will  not  do." 

The  same  principles  are  declared  in  (Jros- 
venor  v.  riiillips.  2  Hill,  147.  and  in  Bank  v. 
Jones,  i  N.  Y.  500.  In  Bonn^jr  v.  Marsh,  10 
Smedes  &  M.  o70;  Chafte  v.  Railroad  Co.,  59 
Miss.  185;  \Yoodruff  v.  Railroad  Co.,  2  Head, 
87.  and  several  other  Tennessee  cases,  the  law- 
is  laid  down  more  stringently,  as  against  the 
factor,  than  the  weiglit  of  authority  justifies. 
There  can  be  no  doubt,  upon  the  weight  of 
authority,  that  if  the  factor  have  claims  for 
advances  against  his  principal,  and  it  lie  ex- 
pressly agreed,  that  goods  shall  be  sliiiiped  to 
the  factor  to  pay  those  advances,  then,  in 
such  cases,  the  Law  makes  the  delivery  to  the 
carrier  a  delivery  to  the  consignee,  though  a 
factor;  and  the  appellee's  counsel  endeavor 
to  bring  the  appellee  within  the  operation  of 
this  rule  as  laid  down  in  Bailey  v.  Rail- 
road, 40  X.  Y.  70,  and  Sti.ius  v.  Wessel.  30 
Ohio  St.  211.  But  these  cases  are  not  analo- 
gous to  the  present  one.  In  Bailey's  Case  it 
was  decided  that  title  had  passed.  Tlie  court 
said  that  the  plaintiffs  in  that  casc>  "occupied 
the  legal  position  of  vendees  after  having 
paid  the  purchase  money  and  received  deliv- 
ery of  the  goods."  It  is  true,  the  court  sa.vs, 
in  addition,  that  it  is  not  necessary  to  hold  in 
That  case  that  the  plaintiffs  occupied  the  posi- 
tion of  vendees  strictly;  but  still  the  decision 
is  wholly  based  en  the  ground  that  "the  ac- 
tual agreement  and  transaction  proved  by  two  | 
members  of  the  firm,  and  uncontradicted,  pre- 
vailed." It  was  because  of  the  agieement  ex- 
pressly proved  that  title  was  held  to  have  { 
pa.ssed  to  the  consignee  on  delivery  to  the  ' 
carrier,  and  in  that  way  the  shipper's  right  to  J 
change  consignment  and  destination  was  lost,  j 
The  court  say  in  that  case,  the  goods  were 
not  sold  outright  to  the  consignee  at  specitied  ! 
price,  but  they  were  by  agreement  sent  to  him 
for  siile.  and  that  the  proceeds  should  be  ap- 
plied to  the  i)ayment  of  the  debt;  creating 
th  rel  y  the  quisi  r  lation  of  tiustee,  1 1  wh  im, 


for  the  purposes  of  the  trust,  tlie  title  passed. 
In  Straus  v.  Wessel.  30  Ohio  St.  211,  the  ad- 
vances had  been  made  on  the  particular  lot  of 
pork  to  be  shipped,  which,  by  express  con- 
tract. Avas  shipped  to  pay  the  indebtedness; 
and  it  was  held,  that  under  these  circumstan- 
ces, the  delivery  to  the  carrier  was  a  delivery 
to  the  consignee,  who.  the  court  say,  in  sucli 
case,  is  in  the  jjosition  of  purchaser,  having 
paid  for  the  goods. 

If  the  present  case  by  the  proof,  measured 
up  in  its  facts  to  these  last  considered  cases 
we  should  think  the  delivery  complete  so  as 
to  pass  title  unless  the  act  of  187(J  interposes 
an  insuperable  barrier  to  such  a  view,  which 
the  necessities  of  this  case  do  not  reciuire  us 
to  consider.  According  to  the  facts  of  the 
case,  which  are  undisputed,  we  think  it  very 
dear  that  there  Avas  no  intention  in  the  orig- 
inal shipment  to  pass  the  title  out  of  the  ship- 
per, which.  Judge  Church  says,  in  Bailey's 
Case,  already  considered,  is  the  true  test  to 
be  applied.  There  was  certainly  no  contract 
that  the  tlour  should  be  shipped  to  pay  the 
margins  or  advances  on  account  of  the  goods 
still  in  Corner's  hands  and  unsold.  The  tlour 
Avas  shipped  Avithout  order  from  Corner  iS: 
Co.  The  letter  advising  Corner  of  the  ship- 
ment and  naming  the  price  at  Avhich  he  Avas 
to  sell,  bears  evidence  of  its  being  an  unsug- 
gested  shipment,  jind  that  Corner  had  been 
Avriting  despon<lingly  of  tlour  prospects.  Not 
a  Avord  Avas  said  in  the  letter  about  designing 
that  shipment  to  pay  former  advances;  ami 
Ave  are  Avarranted  in  supposing  he  did  not 
knoAv  that  the  margins  on  \he  flour  still  in  his 
factor's  hands  Avere  exhausted;  for  it  does 
not  appear  that  Corner  «&  Co.  ever  informed 
him,  until  he  did  so  by  the  letter  of  the  24th 
of  January,  at  Avhich  time  the  flour  Avas  on 
its  Avay  to  Baltimore,  and  ct)uld  not  be  re- 
ceived until  some  days  afterAvards.  In  fact, 
the  proof  shoAVS  that  ^Slerion  thought  a  con- 
siderable balance  Avas  due  him  from  Corner 
&  Co.  on  the  previous  shipments.  As  al- 
ready stated,  Avhen  the  flour  Avas  shipped  to 
Corner  &  Co.,  a  draft  for  it>500  Avas  draAvn  and 
put  in  bank  for  transmission  to  Baltimore 
for  presentation  to  Corner  &  Co.,  but  it  also 
appears  it  Avas  subsequently  AvithdraAVn  and 
was  never  sent,  because  Merlon  had  received 
an  order  from  C.  Ruhl  cV:  Son  for  flour,  and  de- 
termined to  change  the  consignment,  and  send 
this  flour  to  Ruhl  tS:  Sou  instead  of  to  Corner 
cV:  Co.  The  Chicago  railroad  agent  AAas  tele- 
graphed by  the  Minneapolis  agent  to  hold  the 
flour  for  this  change  to  be  made  before  Cor- 
ner &  Co.  sent  their  letter  of  the  24th  of  Jan- 
uary, suggesting  There  was  an  exhaustion  of 
margins,  and  if  any  flour  should  be  shipped, 
that  it  be  shipped  without  draft.  It  is  clear, 
therefore,  there  Avas  no  mutual  assent  be- 
tAveen  Merion  and  Corner  &  Co.  to  the  flour 
being  sent  by  Merion  to  Corner  &  Co.  to  pay 
for  preAious  ailvauces  on  former  orders. 
AA'ithout  such  assent,  of  course  there  Avas  no 
contract,  rnfornniately,  the  carding  of  tiie 
car,    by    tlu'    neglect    of    the    railroad    or    of 


WHEN  TITLE  PASSES. 


17; 


Mt'iiou.  was  not  rhaii.^cd,  aud  the  flour  came 
tlirougb  to  Baltimofc,  aud  was  delivered  to 
Coruer  &  Co.,  aud  this  couiplieatiou  has  pro- 
duced all  the  trouble.  If  the  Hour  was  Mer- 
ion's  wlieu  Corner  received  it,  of  course  Cor- 
ner's liens  for  previous  advances  would  at 
once  attach,  and  ^leriou  would  have  to  pay 
them  to  release  the  flour;  but  if.  on  the  other 
liand,  Merion  had.  while  the  flour  was  in 
transitu  and  at  his  risk,  parted  with  the  title, 
and  the  flour  was  no  lousier  liis.  the  liens  of 
Corner  «&  Co.  would  not  and  could  not  attach. 
We  have  seen  that  when  the  flour  was  ship- 
ped it  was  sent  to  Corner  without  order,  aud 
the  carrier  was  Merion's  ajieut  aud  not  Cor- 
ner's; aud  that  notliiuy  afterwards  occurred 
to  change  the  relation  of  the  carrier  and 
make  it  the  agent  of  Coruer  <Jc  Co.  is  clear; 
for  the  .sale  to  Ruhl  &  Son  was  made  before 
Comer  &:  Co.  had  ever  made  their  proposition 
of  the  24th  of  .lanuary.  Suijpose.  instead  of 
the  flour  being  received  by  Corner  <fc  Co.,  it 
had  been  received  by  Ruhl  &  Sou,  could  Cor- 
ner &  Co.  have  maintained  replevin  or  trover 
for  the  flour?  It  certainly  could  not  be  con- 
tended, upon  the  proof  that  they  could.  If 
not.  then  Corner  &  Co.  had  no  title,  aud  Kuhl 
«Jc  Sou  had  acquired  title  aud  the  right  to  sue 
Corner  &  Co.  If  Corner  &  Co.  have  been 
misled  to  their  injiny,  they  must  look  else- 
where for  redress.  What  the  law  or  equity 
would  do.  if  the  controversy  Avas  between 
Merion  and  Corner  cV:  Co.,  must  uot  be  con- 
sidered to  divert  the  mind  from  tlie  rights  of 
Kuhl  iVc  Son. 

The  court  below  erred  in  granting  the  de- 
fendant's prayer.  It  is  entirely  at  variance 
with  the  law  of  the  case,  as  Ave  have  declared 
it.  The  flrst  prayer  of  the  plaintiff  was  cor- 
rect in  principle,  but  it  omitted  some  of  the 
facts  necessary  for  the  jury  to  find.  It  ought 
to  have  submitted  to  the  jury  to  And  the  fact, 
that  the  original  shipment  to  the  defendant 
Avas  without  his  order,  and  Avas  sent  Avithout 
bill  of  lading  and  actual  draft  on  Comer  «& 
Co.,  and  that  before  Corner  &  Co.  received 
the  flour  from  the  carrier,  the  sale  Avas  made 
to  Kuhl  &  Son.     When  tliese  elen)ents  are  in- 


corporated in  the  prayer,  it  Avill  be  right. 
The  second  prayer  was  correctly  refused,  for 
it  submits  a  question  Avhich,  under  our  vieAV, 
the  jury  liad  nothing  to  do  with,  inasnmcli  as 
the  factor's  authority  was  revoked  liy  the 
sale  to  Kuhl  &  Sou.  It  was  unnecessary. 
The  third  prayer  Avas  correctly  refused,  for  it 
claims  as  the  measure  of  damages  that  which 
belongs  to  the  action  of  trover,  aud  uot  to  tlie 
form  of  action  adopted  by  the  plaintitts.  lu 
the  action  of  assumpsit,  in  the  aljsence  of 
proof  of  actual  sale  of  the  goods  to  the  de- 
fendant the  [)laintifl'  can  only  recover  for  the 
money  liad  and  received  from  the  sale  of  tue 
flour  to  tlie  use  of  the  plaintiff.  The  prayer 
Avas  therefore  inconsistent  with  tlie  form  of 
action. 

The  question  raised  by  the  first  bill  of  ex- 
ceptiou  needs  no  discussion.  The  proof  ten- 
dered was  wholly  immaterial,  aud  Avithout 
bearing  upon  the  issue.  The  previous  admis- 
sion of  irrelevant  testimony,  witliout  objec- 
tion, did  not  render  its  rebuttal  competent. 
There  Avas,  therefore,  no  error  in  its  rejection. 

The  objection  which  has  been  raised  by  the 
appellee's  coun.sel,  that  the  first  aud  second 
bills  of  exception  are  not  siitticieutly  connected, 
by  apt  language,  to  entitle  the  court  to  look  at 
the  evidence  in  the  first  bill  of  exception,  for 
the  purpose  of  determining  upon  the  correct- 
ness of  the  court's  rulings  upun  the  instruc- 
tions, cannot  be  maintained.  All  the  evidence 
was  in.  aud  the  prayers  Avere  not  intended  to 
be  mere  abstractions.  They  Avere  offered 
with  reference  to  the  proof,  as  their  form 
shoAvs.  The  most  appropriate  language  is  not 
used  for  connecting  the  two  bills  of  excep- 
tion, but  Ave  regard  it  as  entirely  sutticient. 
The  case  is  .similar  to  and  covered  l)y  Haiti- 
more  and  Ohio  Railroad  Company  vs.  State, 
use  of  Fryer.  :iO  Md.  47.  The  language  used 
is.  "all  the  testimony  being  in.  the  plaintiffs 
oft'ered  the  following  prayers."  Reference  to 
the  testimony  recited  is  mauifestly  made.  It 
is  equivaleut  to  saying  '"there  beiug  uo  othei' 
testimony."  or  "this  beiug  all  the  testimony." 
The  inteution  is  too  plain  to  be  disregarded. 

.ludgment  reversed,  aud  ucav  trial  aAA-arded. 


17J 


WHEN  TITLP]   PASSES. 


LANE  V.  CHADWICK. 

(15  N.  E.  121,  14G  Mass.  (S.) 

Siipronio  .rudicial   Court   of   Massachusolls. 
Dukes.      Jan.  9,  1S8S. 

Exceptions  from  superior  court,  Dukes 
■county;    Ilannnond.  .Tmlsc 

Action  of  replevin  by  plaintiff,  Lane, 
against  defendant  Chadwick,  a  common  car- 
rier of  goods.  Trial  in  the  superior  court, 
without  a  jury,  where  the  court  found  for  the 
defendant,  and  the  plaintiff  alleged  excep- 
tions.    The  facts  are  stated  in  the  opinion. 

P.  H.  Hutchinson  and  C.  G.  M.  Dunham, 
for  plaintiff.  H.  M.  Knowlton,  for  defend- 
ant. 

MORTON.  C.  T.  To  maintain  replevin,  the 
plaintiff  must  show  that,  at  the  time  she 
sued  out   her  writ,   she  was  entitled  to  the 


immediate  and  exclusive  possession  of  the 
goods  replevied.  Collins  v.  Evans,  15  Pick. 
»;3;  Wade  v.  Mason,  12  Gray,  335.  The 
goods  in  suit  were  delivered  to  the  defend- 
ant, who  is  a  common  carrier,  by  the  con- 
signor in  Boston,  to  be  transported  to  the 
plaintiff'.  They  were  in  two  boxes,  securely 
nailed  up,  and  were  accompanied  by  an  item- 
ized bill.  The  defendant  was  instructed  to 
deliver  the  goods  to  the  plaintiff'  ui)on  the 
l)ayment  of  the  bill  by  her  in  casn.  The  de- 
livery to  the  carrier  was  not  a  delivery  to 
the  i^laintift'.  He  was  not  her  agent,  but  the 
agent  of  the  consignor.  Bank  v.  Bangs,  102 
Mass.  21>1.  Until  he  delivered  the  goods  to 
her  no  title  or  right  of  possession  would  pass 
to  her,  and  it  is  immaterial  whether  he  right- 
fully or  wrongfully  refused  to  make  the  de- 
livery. At  the  time  she  replevied  the  goods, 
she  had  no  title  or  right  of  possession.  Ex- 
ceptions overruled. 


WIIi:.\    JITLi:    PASSES. 


177 


HiGGiNS  V.  :\[rui:AY. 

(73  N.  Y.  ■27,-2.\ 
Court  of  Appeals  of  New  York.  1878. 
Action  for  work  and  materials.  Defendant 
enaployed  plaintiff  to  maunfacture  some  cir- 
cus tents,  Avitliiu  a  .specitied  time,  from  ma- 
terial fiirnislied  by  plaintiff.  No  place  of 
delivery  or  price  was  si)ecitied.  Defendant 
afterwards  requested  plaintiff,  by  letter,  to 
ship  the  tents  to  him  at  Lewistou.  He  ship- 
ped them  b.v  steamboat,  via  I'ortland,  C.  0.1)., 
and  they  were  destroyed  by  fire  on  the  way. 

CHFRCIl.  C.  J.  The  action  is  not  strictly 
for  the  sale  of  the  article  manufactiu-ed.  but 
for  work,  labor,  and  materials,  performed 
and  used  in  its  manufacture  (Mixer  v.  How- 
arth.  21  Pick.  20."));  and  hence  is  not  within 
the  statute  of  frauds.  It  is  undisputed  tliat 
the  plaintiff  performed  liis  contract,  and  if 
the  defendant  had  refused  to  take  the  tents, 
an  action  upon  the  agrreement  would  have 
been  sustained.  Crookshank  y.  Biu'rell.  18 
Johns.  oS.  There  is  some  confusion  in  the 
authorities  as  to  when  the  title  passes  to  the 
purchaser  in  such  cases.  In  Andrews  v. 
Durant,  11  N.  Y.  3o,  Denio.  J.,  lays  down  the 
rule,  that  in  such  a  case  "the  title  does  not 
pass  until  the  article  is  finislied  and  deliver 
ed.  or  at  least  ready  for  delivery,  and  ap- 
proved by  such  party;"  and  there  are  otli- 
er  authorities  to  the  same  effect.  Grippeu 
V.  Railroad  Co..  40  N.  Y.  3i!;  Comfort  v. 
Kiersted,  20  Barb.  473. 

It  is  urged  in  this  case  that  the  title  did 
not  pass,  for  two  reasons:  First.  Because 
there  was  no  acceptance;  and.  second.  Be- 
cause the  plaintiff'  sliipped  the  property  C. 
O.  D.,  thereb.v  refusing  to  deliver  until  the 
value  was  paid.  This  last  ground  was  sus- 
tained in  Baker  v.  Bourcicault,  1  Daly.  24. 
where  certain  cards  were  ordered  to  be  sent 
to  New  Orleans,  and  were  sent  C.  O.  D.. 
and  lost  at  sea. 

The  important  question  to  determine  is 
when  the  lial)ility  of  the  defendant  attach- 
ed.  If  the  article  had  burned  during  the 
progress  of  construction,  it  is  clear  that  no 
action  would  lie,  for  the  reason  that  the 
contract  was  an  entirety,  and  until  perform- 
ed, no  liability  would  exist.  And  this  rule 
I  apprehend  would  apply  when  the  contract 
is  to  make  and  deliver  at  a  particular  place. 
and  loss  ensues  before  delivery  at  the  place, 
and  for  the  same  reason.  But  when  the  con- 
tract is  fully  performed,  both  as  it  respects 
the  character  of  the  article,  and  the  delivery 
at  the  place  agreed  upon  or  implied,  and 
the  defendant  is  notified,  or  if  a  specified 
time  is  fixed,  and  the  contract  is  performed 
within  that  time,  upon  geueral  principles  I 
am  unable  to  perceive  wh.v  the  party  mak- 
ing such  a  contract  is  not  liable.  One  per- 
son agrees  to  manufacture  a  wagon  for  an- 
other in  thirty  days  for  ."flOO.  and  the  other 
agrees  to  pay  for  it.  The  mechanic  performs 
his  contract.  Is  he  not  entitled  to  enforce 
the  obligation  against  the  other  party,  and  if 

VAX  ZILE  SEL.CAS.SALES— 13 


after  such  performance  the  wagon  is  destroy- 
ed without  the  fault  of  the  meclianic,  is  thf 
undischarged  liability  canceled?  It  does  not 
depend  upon  where  the  technical  title  is, 
as  in  the  sale  of  goods.  It  was  upon  this 
principle  substantially  that  Adlard  v.  Booth, 
7  Car.  &  I*.  108,  was  decided.  The  qius- 
tion  was  submitted  to  the  jury  whether  tlie 
work  of  printing  books  was  complete<l  be- 
fore the  fire.  Suppose  in  this  case  that  the 
defendant  had  refused  to  accept  a  delivery 
of  the  tent,  his  liability  would  have  been  the 
same,  although  the  tith-  was  not  in  hlui. 
The  plaintiff  had  a  lien  upr)n  the  article  for 
the  value  of  his  labor  and  materials,  which 
was  good  as  long  as  he  retained  jjossession. 
This  was  In  the  nature  of  a  pledge  or  mort- 
gage. Retaining  the  lien  was  not  incon- 
sistent with  his  right  to  enforce  the  liability 
for  which  tliis  action  was  brought.  That 
liability  was  complete  when  the  recpiest  to 
ship  was  made  by  the  defendant,  and  was 
not  affected  by  complying  with  the  request, 
nor  by  retaining  the  lien  the  same  as  when 
the  reqtiest  was  made.  As  the  article  was 
shipped  at  the  request  of  and  for  the  benefit 
of  the  defendant  (assuming  that  it  was  done 
in  accordance  with  the  directions),  it  follows 
that  it  was  at  his  risk,  and  could  not  impair 
the  right  of  the  plaintiff  to  recover  for  th" 
amount  due  him  upon  the  performance  of 
his  contract. 

If  the  plaintiff  had  agreed  to  deliver  the 
tent  in  Lewiston  as  a  part  of  the  contract 
for  its  manufacture,  he  could  not  have  re- 
covered anything:  l)ut  this  was  not  a  part 
of  the  contract.  Suppose  the  tent  had  reach- 
ed Lewiston  in  good  order  and  the  defendant 
had  refused  to  accept  or  receive  it,  his  lia- 
bility would  be  clear  and  complete.  As  be- 
fore stated,  the  point  as  to  who  had  the  title 
is  not  decisive.  It  may  be  admitted  that  the 
plaintiff  retained  the  title  as  security  for  the 
debt,  and  yet  the  defendant  was  liable  for 
the  debt  in  a  proper  personal  action.  This 
is  a  case  of  misfortune  where  one  of  the  par- 
ties without  fault  must  incur  loss,  and  it 
seems  to  me  very  clear  that  the  legal  right  is 
with  the  plaintiff".  A  point  is  made  that  the 
property  was  not  properly  shipped.  It  was 
directed  to  the  defendant  at  Lewistou.  and 
was  forwarded  to  I'ortland  on  a  steamer 
running  to  that  place.  It  does  not  appear 
but  that  was  the  usual  mode  of  shlpmiUit  to 
Lewiston.  and  the  deviation  would  imjiose 
the  obligation  upon  tlie  consignee  at  the  lat- 
ter place  to  forward  the  property  by  a  C(tn- 
necting  carrier.  \Ve  cannot  presume  that 
there  was  no  connecting  route,  and  if  we 
could,  it  is  dltticult  to  see  what  else  the  plain- 
tiff coidd  have  done.  At  all  events  it  does 
not  appear  that  the  loss  was  occasioned  by 
the  defendant's  negligence  or  fault  in  not 
properly  shipping  the  goods. 

The  judgment  must  be  attirmed. 

All  concur  except  ALLKX  and  .MILLER, 
.J.I.,  absent. 

Judgment  attirmed. 


178 


WHEN  TITLE  PASSES. 


FLEMING  V.   COMMONWEALTH.i 

(IS  Atl.  G22,  130  Pa.  St.  138.) 

Siiproino  Court  of  Pennsylvania.     Nor.  4,  1889. 

Error  to  court  of  quarter  sessions,  Mercer 
county. 

The  {)laiiitilT  in  error,  Joseph  Fleming,  be- 
ing a  vviiohsale  liijuor  dealer,  licensed  and 
carrying  on  business  in  Allegheny  county, 
sold  and  sent  from  his  place  of  business,  C. 
O.  D.,  to  Mercer  county,  wiiere  he  had  no  li- 
cense, liijuors  ordered  by  persons  in  the  latter 
county.  For  this  he  was,  at  tlie  court  of 
quarter  sessions  of  Mercer  county,  indicted, 
tried,  convicted,  and  sentenced  for  selling 
liquor  tlierein  without  a  license.  lie  now 
brings  error. 

George  JShiras,  Jr.,  and  William  S.  Pier, 
for  plaintiff  in  error.  G.  IV.  McBii(le,J.  A. 
IStraiialian,  and  S.  H.  Miller,  for  the  Coni- 
nionwealth. 

GREEN,  .J.  In  the  case  of  Garbr;icht  v. 
Com.,  96  Pa.  St.  449,  which  was  an  indict- 
ment for  selling  liquor  without  license,  we 
hold  that  "the  place  of  sale  is  the  point  at 
which  goods  ordered  or  purchased  are  set 
apart  and  delivered  to  the  purchaser,  or  to  a 
common  carrier,  who,  for  the  purposes  of  de- 
livery, represents  him."  In  that  case  the  or- 
der for  the  liquor  was  solicited  and  obtained 
by  the  defendant  in  the  county  of  Mercer,  but 
was  sent  to  his  principal,  who  was  a  liquor 
dealer  in  the  county  of  Erie.  Th.^  order  was 
executed  by  the  principal,  who,  in  the  county 
of  Erie,  at  his  place  of  business,  separated  or 
set  apart  from  Ids  eeneral  stock  the  liquor 
ordered,  and  delivered  it  t»  a  common  carrier 
to  be  forwarded  t'  its  destination  in  Mercer 
county.  We  deci  .ed  that  this  was  no  viola- 
tion of  the  law  )hibiting  sales  without  li- 
cense, although  neither  the  defendant,  who 
was  a  traveling  agent,  nor  his  principal  held 
any  license  for  the  sale  of  liquor  in  Mercer 
county.  This  decision  was  not  changed  in 
the  least  upon  a  subse()uent  trial  of  the  same 
defendant  on  a  different  state  of  facts,  as  re- 
ported in  1  Penny.  471.  In  the  case  now  un- 
der consideration  the  liquor  was  sold  upon 
oiders  sent  by  mail  by  the  purchasers,  living 
in  Mercer  county,  to  the  defendant,  who  is  a 
whol<  sale  liquor  dealer  in  Alleghenv  county. 
'J'he  goods  were  set  apart  at  the  defendant's 
place  of  business  in  Allegheny  county,  and 
were  there  delivered  to  a  common  carriei-, 
consigned  to  the  purchaser  at  his  address  in 
Mercer  county,  and  by  the  carrier  transported 
to  Mercer  county,  and  there  delivered  to  the 
purchaser,  who  paid  the  expense  of  trans- 
portation. Upon  these  facts  alone,  the  de- 
cision of  this  court  in  the  Case  of  Garl)racht, 
supra,  is  directly  and  distinctly  ai){)Iicable, 
and  requires  us  to  reverse  the  judgment  of 
the  court  below,  unless  there  are  other  facts 
in  the  case  which  distinguish  it  from  that  of 
Garbracht. 

It  is  claimed,  and   it  was  so  held   by  the 

1  Di-sspnting  opiuiou  of  Williams,  .7.,  omittpd. 


court  below,  that,  because  the  goods  were 
marked  "C.  O.  D.,"  the  sale  w^as  not  complete 
until  the  delivery  was  made;  and  as  tliat  took 
place  in  Mercer  county,  where  the  defendant's 
license  was  inoperative,  lie  was  without  li- 
cense as  to  suc-h  sales,  and  became  subject  to 
the  penalty  of  the  criminal  law.  The  aigu- 
ment  by  which  this  conclusion  was  reached 
was  simply  that  the  i)ayment  of  the  price  was 
a  condition  precedent  to  the  delivery,  and 
hence  theie  was  no  delivery  until  payment, 
and  no  title  passed  until  delivery.  Tiie  legal 
and  criminal  inference  was,  the  sale  was  made 
in  Mercer,  and  not  in  Allegheny.  This  rea- 
soning ignores  certain  facts  which  require 
consideration.  The  orders  were  sent  by  the 
purchasers,  in  Mercer,  by  mail  to  the  seller, 
in  Alle<iheny,  and  in  the  orders  the  purchas- 
ers requested  tiie  defendant  to  send  the  goo^is 
C.  O.  D.  The  well-known  meaning  of  such 
an  order  is  that  the  price  of  the  goods  is  to  he- 
collected  by  the  carrier  at  the  time  of  the  de- 
livery. The  purchase!-,  for  his  own  conven- 
ience, requests  the  seller  to  send  him  the 
goods,  with  authority  in  the  carrier  to  receive 
the  money  for  them.  This  method  of  pay- 
ment is  the  choice  of  the  purchaser,  under 
such  an  order;  and  it  is  beyond  question  that, 
so  far  as  the  puichaser  is  concerned,  the  car- 
rier is  his  agent  for  the  receipt  and  transmis- 
sion of  the  money.  If  the  seller  accedes  to- 
such  a  request  Ijy  the  [)ui chaser,  he  certainly 
authorizes  the  pui'cliaser  to  pay  the  money  to 
the  carrier,  and  the  purchaser  is  relieved  of 
all  liabilities  to  the  seller  for  the  price  of  the 
goods  if  he  pays  the  price  to  the  carrier.  The 
liability  for  the  price  is  transferred  from  the 
seller  to  the  carrier;  and  whether  the  carrier 
receives  the  price  or  not,  at  the  time  of  deliv- 
ery, he  is  liable  to  the  seller  for  the  price  if  he 
does  deliver.  Substantially,  therefore,  if  the 
delivery  is  made  bv  the  carrier,  and  he  chcsos 
to  give  credit  to  the  purchaser  for  the  pay- 
ment of  the  price,  the  transaction  is  complete, 
so  far  as  the  seller  is  concerned,  and  the  pur- 
chaser may  hold  the  goods.  Of  course,  if  the 
seller  were  himself  delivering  the  goods  in 
parcels  upon  condition  that  on  delivery  of  the 
last  parcel  the  price  of  the  whole  should  be 
paid,  it  would  be  a  fraud  on  the  seller  if  the 
puichaser,  aftergelting  all  the  parcels,  should 
refuse  to  perform  the  condition  upon  which 
he  obtained  them,  and  in  such  circumstances 
the  seller  would  be  entitled  to  receive  the 
goods.  This  was  the  case  in  Henderson  v. 
Lauck,  21  Pa.  St.  3.59.  The  court  below,  in 
that  case,  expressly  charged  that  if  the  seller 
relied  on  the  promise  of  the  purchaser  to  pay, 
and  delivered  the  goods  absolutely,  the  right 
to  the  property  was  changed,  although  the 
conditions  were  never  performed;  but  if  he 
relied,  not  on  the  promise,  but  on  actual  pay- 
ment at  the  delivery  of  the  last  load,  he  might 
reclaim  tlie  goods  if  the  money  was  not  paid. 
The  case  at  bar  is  entirely  different.  So  far 
as  the  seller  is  concerned,  he  is  satisfied  to 
take  the  responsibility  of  the  carrier  for  the 
price,  in  jilace  of  that  of  the  seller.  He  au- 
thorizes the  purchaser  absolutely  to  pay  the 


WHEN  TITLE  PASSES. 


17a 


price  to  tlie  c.irrier;  and,  if  lie  does  so,  un- 
doubtedly tl)e  piircli.iser  is  relieved  of  all  re- 
sponsibility for  the  price,  whether  the  carrier 
ever  pays  it  to  the  seller  or  not.  But  tlie  car- 
rier is  also  autiiorizf'd  to  deliver  the  goods. 
If  he  does  so,  and  receives  the  price,  he  is  of 
course  liable  for  it  to  the  seller.  But  he  is 
equally  liable  for  the  price  if  he  chooses  to  de- 
liver the  goods  without  receiving  the  price. 
It  cannot  be  questioned  that  the  purchaser 
would  be  liable  also;  but,  as  1)6  bad  received 
the  goods  from  one  who  was  authorized  to  de- 
liver them,  his  right  to  hold  them  over  as 
iigainst  the  seller  is  undoubted.  In  other 
words,  the  direction  embodied  in  the  letters 
"C.  O.  D.,"  phiced  upon  a  package  committed 
to  a  carrier,  is  an  order  to  the  carrier  to  col- 
lect the  money  for  the  package  at  the  time  of 
its  delivery.  It  is  a  part  of  the  undertaking 
of  the  carrier  with  the  consignor,  a  violation 
of  vvjiich  imposes  upon  the  carrier  the  obliga- 
tion to  pay  the  price  of  the  article  delivered, 
to  the  cons  gnor.  AVe  have  been  referred  to 
no  authority,  and  have  been  unable  to  discov- 
er any,  for  llie  proposition  that  in  such  a  case, 
after  actual,  absolute  delivery  to  the  purchas- 
er by  the  carrier  without  payment  of  the 
price,  the  seller  couM  reclaim  the  goods  from 
the  purchaser  as  upon  violation  of  a  condition 
precedent. 

If,  now,  we  pause  to  consider  the  actual 
contract  relation  between  the  seller  and  pur- 
chaser, where  the  purchaser  orders  the  goods 
to  be  sent  to  him  C.  O.  D.,  the  matter  be- 
comes still  more  clear.  Upon  such  an  order, 
if  it  is  accepted  by  the  seller,  it  becomes  the 
duty  of  the  seller  to  deliver  the  goods  to  the 
carrier,  with  instruction  to  the  carrier  to  col- 
lect tiie  price  at  the  time  of  delivery  to  the 
purchaser.  In  such  a  case  it  is  the  duty  of 
the  purchaser  to  receive  the  goods  from  the 
carrier,  and,  at  the  time  of  receiving  them, 
lo  pay  the  price  to  the  carrier.  This  is  the 
whole  of  the  contract,  so  far  as  the  seller  and 
the  purchaser  are  concerned.  It  is  at  once 
apparent  that  when  the  seller  has  delivered 
the  goods  to  the  carrier,  with  the  instruc- 
tion to  collect  the  price  on  delivery  to  the 
purchasei',  he  has  performed  his  whole  duty 
under  the  contract;  he  has  nothing  more  to  do. 
If  the  purchaser  fail  to  perform  his  part  of 
the  contract,  the  seller's  right  of  action  is 
complete;  and  he  may  recover  the  price  of  the 
goods  from  the  purchaser,  where  the  pur- 
chaser takes,  or  refuses  to  take,  the  goods 
from  the  carrier.  Hence  it  follows  tliat  the 
passage  of  the  title  to  the  [)urchaser  is  not 
essential  to  the  legal  completeness  of  the  con- 
tract of  sale.  It  is,  in  fact,  no  more  than  the 
ordinary  ca.se  of  a  contract  of  sale,  wherein 
the  seller  tenders  delivery  at  the  time  ami 
place  of  delivery  agreed  upon,  but  the  pur- 
chaser refuses  i  .rlormance.  In  such  case  it 
is  perfectly  familiar  law  that  the  purchaser 
is  legally  liable  to  pay  the  price  of  the  goods, 
although,  in  point  of  fact,  he  has  never  had 
them.  The  order  to  pay  on  delivery  is 
merely" a  superadded  term  of  the  contract; 
but  it  is  a  term  to  be  performed  by  the  pur- 


chaser, and  has  no  other  effect  upon  the  con- 
tract than  any  other  teim  affecting  the 
factum  of  delivery.  It  must  be  performed 
by  the  purchaser,  just  as  the  obligation  to  re- 
ceive the  goods  at  a  particular  time  or  a  par- 
ticular place.  Its  non-performance  is  a  breach 
by  the  purchaser,  and  not  by  the  seller,  and 
theiefore  cannot  alTect  therightof  the  seller  to 
regard  the  contract  of  sale  as  comi)lete,  and 
completely  perlormed  on  ills  part,  without 
any  regard  to  the  question  whethnr  the  title  to 
the  goods  has  passed  to  the  purchaser  as  upon 
an  actual  reception  of  the  goods  l)y  him.  If 
this  be  so,  the  case  of  the  commonwealth  falls 
to  the  ground,  even  upon  the  most  critical 
consideration  of  the  contract  between  the  par- 
ties, regarded  as  a  contract  for  civil  purposes 
only.  The  duties  which  lie  intermediate  be- 
tween those  of  the  seller  and  those  of  the 
purchaser  are  those  only  which  pertain  to, 
and  are  to  be  performed  by,  the  carrier. 
These,  as  we  have  before  seen,  are  the  (ordi- 
nary duties  of  carriage  and  delivery,  with 
the  additional  duty  of  receiving  the  price 
from  the  purchaser,  and  transmitting  it  to 
the  seller.  The  only  decided  case  to  which 
we  have  been  referred  which  presents  tlie  ef- 
fect of  an  order  C.  O.  D.  to  a  carrier  is  II ig- 
gins  v.  ^Murray,  73  N.  Y.  252.  There  the 
defendant  enq)loyed  the  plaintiff  to  manu- 
facture for  him  a  set  of  circus  tents.  When 
they  were  finished,  tlie  plaintiff' shipped  them 
to  the  defendant  C.  O.  D.,  and  they  were  de- 
stroyed by  fire  on  the  route.  It  was  held  that 
tlie  defendant,  who  was  the  purchaser,  should 
bear  the  loss;  that  the  plaintiff  had  a  lien  on 
the  tents  for  the  value  of  his  labor  and  ma- 
terials, and  his  retaining  his  lien  by  shipping 
them  C.  O.  \).  was  not  inconsistent  with,  and 
did  not  affect,  his  right  to  enforce  tiie  de- 
fendant's liability.  In  the  course  of  the 
Opinion,  Chief  .Justice  Ciirmii  said:  "Sup- 
pose, in  this  case,  that  the  defendant  had  re- 
iii-ed  10  accejit  a  delivery  of  the  tent,  his  lia- 
bility would  have  been  the  same,  although 
the  title  was  not  in  him.  The  plaintitf  had 
a  lien  upon  the  article  for  the  value  of  his 
falior  and  materials,  which  was  good  as  long 
as  he  ret.iined  possession.  1=  *  *  Retain- 
ing the  lien  was  not  incmsistent  with  his 
right  to  enforce  the  liability  for  which  this 
action  was  brought.  That  liability  was  com- 
pl  te  when  the  reijuest  to  ship  was  made  by 
the  defendant,  and  was  not  affected  by  com- 
plying witli  the  request,  nor  by  retaining  the 
lien  the  same  as  when  the  request  was  made. 
As  the  article  was  shipped  at  the  requ(  st  of, 
and  for  the  benefit  of,  the  defendant,  (assum- 
ing that  it  was  done  in  accordance  with  the 
directions,)  it  follows  that  it  was  at  his  risk, 
and  could  not  impair  the  right  of  the  plain- 
tiff to  recover  for  the  amount  due  him  upon 
the  performance  of  his  contract.  *  *  * 
As  before  stated,  the  point  as  to  who  had  the 
title  is  not  decisive.  It  may  be  admitted 
tliat  the  plaintiff  retained  the  title  as  secu- 
rity for  the  debt,  and  yet  the  defendant  was 
liable  for  the  debt  in  a  proper  jjersonal  ac- 
tion."   It  seems  to  us  this  reasoning  is  pei- 


180 


WHKX   TITTJ':   I'ASSES. 


IVftly  sound.  Practioiilly,  it  \v;is  ruit'cl  tluit 
the  eltVct  of  the  order  V.  O.  D.  was  simply 
tiie  retention  of  tlie  seller's  lien,  and  that 
sucli  retention  of  lien  is  not  inconsistent 
with  a  ritrht  of  recovery  for  the  price  of  the 
article,  thoiiyh,  in  point  of  fact,  it  is  not  de- 
livered to  the  [lurcliaser.  In  other  wards, 
the  literal  state  of  tiie  title  is  not  decisive  of 
the  question  of  liability  of  the  purchaser,  and 
he  niiiy  be  coinpelle<l  to  pay  for  the  article, 
tliougii  he  never  received  it  into  his  actual 
possession.  The  chief  justice  propounds  the 
very  question  suggested,  heretofore,  of  a  re- 
fusal liy  the  purchaser  to  accept  the  article, 
and  holds  that  his  liability  would  be  the 
same,  thougii  the  title  was  not  in  him. 

In  Ilutcliinson  on  C.irriers,  at  section  389, 
the  writer  thus  states  the  position  and  duty 
of  the  carrier:  ''Tiie  carrier  wlio  accei)ts  the 
goods  with  such  instructions  [C.  O.  D.]  un- 
dertakes that  they  shall  not  be  delivered  un- 
less the  condition  of  payment  be  complied 
with,  and  becouies  the  agent  of  the  shipper 
of  the  goods  to  receive  such  paynsent.  He 
therefore  undertakes,  in  addition  to  ids  duties 
as  carrier,  to  collect  for  tiie  consignor  the 
jirice  of  his  goods."  And  again,  in  section 
390:  "When  the  goods  are  so  received,  the 
carrier  is  held  to  a  strict  compliance  with 
such  instructions;  and,  if  the  goods  are  de- 
livered without  an  exaction  from  the  con- 
signee of  the  amount  which  tlie  carrier  is  in- 
structed to  collect,  he  becomes  liable  to  the 
consignor  for  it."  This  is  certainly  a  correct 
statement  of  the  position  and  lialiility  of  the 
carrier.  He  becomes  subject  to  an  added 
<luty, — that  of  collection;  and,  if  he  fails  to 
perform  it,  he  is  liable  to  the  seller  for  the 
price  of  the  goods.  We  have  sear(  bed  in 
vain  for  any  text-writer's  statement,  or  any 
decision,  to  the  effect  that  in  such  case  no 
title  passes  to  the  purchaser.  We  feel  well 
assured  none  such  can  be  found.  Jjut,  if 
this  be  so,  the  whole  theory  that  the  title 
does  not  pass  if  the  money  is  not  paid  falls, 
and  the  true  legal  status  of  the  parties  re- 
sults that  the  seller  has  a  remedy  for  the 
price  of  the  goods  against  the  carrier.  In 
other  words,  an  order  from  a  seller  to  a  car- 
rier to  collect  on  delivery,  accepted  by  the 
carrier,  creates  a  contract  between  the  seller 
and  the  carrier,  for  a  breach  of  which  by  the 
carrier  the  seller  may  recover  the  price  from 
him.  So  far  as  the  seller  and  purchaser  are 
concerned,  the  latter  is  liable,  whether  he 
takes  tiie  goods  from  the  carrier  or  not,  and 
the  order  itself  is  a  mere  provision  for  the 
retention  of  the  seller's  lien.  While,  if  the 
goods  are  not  delivered  to  the  purchaser  by 
the  carrier,  the  title  does  not  pass,  that  cir- 
cumstance does  not  affect  the  ciiaracter  of  the 
transaction  as  a  sale;  and  the  right  of  the 
seller  to  recover  the  price  from  the  purchaser, 
if  he  refuse  to  take  them,  is  as  complete  as 
if  he  had  taken  them,  and  not  paid  for  them. 

Thus  far  v.e  have  regarded  the  transactions 
between  the  i)arlies  in  its  aspect  as  a  civil 
contract  only;  but,  when  viewed  in  its  as- 
pect as  tiie  source  of  a  criminal  prosecution, 


tlie  transaction  becomes  much  more  clear  of 
doubt.  It  is  manifest  that,  wh«n  the  pur- 
chaser ordered  the  goods  to  be  sent  to  him 
C.  O.  D.,  he  constituted  the  carrier  his  agent, 
both  to  receive  the  goods  fii>m  the  seller,  and 
to  transmit  the  price  to  the  seller.  When, 
thnrefore,  the  goods  were  delivered  to  the 
carrier  at  Pittsburgh  for  the  purpose  of  trans- 
portation, the  duty  of  the  seller  was  per- 
formed, as  we  have  already  seen,  so  far  as 
he  and  the  purchaser  were  concerned,  and  as 
between  them  the  transaction  was  complete. 
The  duty  of  transportation  devolved  upon 
the  carrier,  and  for  it  he  was,  in  one  sense, 
tiie  agent  of  the  seller,  as  well  as  of  the  pur- 
chaser; but,  as  it  was  to  be  at  the  expense 
of  the  purchaser,  the  delivery  to  the  carrier 
was  a  delivery  to  the  purcliaser;  and  this 
was  ruled  in  (Jarbracht's  Case.  Tlie  injunc- 
tion to  the  carrier  to  collect  the  money  on  de- 
liveiy  impiised  an  additional  duty  on  the  car- 
rier, which  the  carrier  was,  of  course,  bound 
to  discharge.  This  arrangement  was  a  mat- 
ter of  convenience,  both  to  tiie  purchaser  and 
the  seller,  rehitive  to  the  payment  and  trans- 
mission of  the  price;  but  that  is  all.  To  con- 
vert this  entirely  innocent  and  purely  civil 
conversation,  respecting  the  mode  of  collect- 
ing the  price  of  the  goods,  into  a  crime,  is, 
in  our  judgment,  a  grave  perversion  of  the 
criminal  lavv,  to  which  we  cannot  assent.  As 
a  matter  of  course,  there  is  an  utter  absence 
of  any  criminal  intent  in  the  case.  The  de- 
fendant had  a  license.  The  sale  was  made 
at  his  place  of  business,  and  both  the  sale 
and  delivery  were  completed  within  the  ter- 
ritory covered  by  the  license.  If,  now,  a 
criminal  character  is  to  be  given  to  the  trans- 
action, it  must  be  done  by  means  of  a  tech- 
nical inference  that  the  title  did  not  pass  un- 
til the  money  was  paid;  and  thus  that  the 
place  of  sale,  which  in  point  of  fact  was  in 
Allegheny  county,  was  changed  to  M-mc  r 
county,  where  no  sale  was  made.  Even 
granting  that,  in  order  to  conserve  the  ven- 
dor's lien,  su'h  a  technical  inference  would 
be  jiistilied  for  the  purposes  of  a  civil  con- 
tract, it  by  no  means  follows  that  the  plain 
facts  of  the  case  must  be  clothed  with  a  crim- 
inal consHquence  on  that  account.  So  far  as 
tlie  criminal  law  is  concerned,  it  is  only  an 
actual  sale  without  license  that  is  prohibit- 
ed. But  there  was  no  such  sale,  because  all 
the  essential  facts  which  constitute  the  sale 
transpired  in  Allegheny  county,  where  the 
defendant's  license  was  operative.  The  car- 
rier, being  the  agent  of  the  purchaser  to  re- 
ceive the  goods,  does  receive  them  from  the 
seller  in  Allegheny  county,  and  the  delivery 
to  him  for  the  purpose  of  transportation  was 
a  delivery  to  the  purchaser.  This  is  tlie  le- 
gal, and  certainlv  the  common,  understand- 
ing of  a  sale.  The  statute,  being  criminal, 
must  be  strictly  construed;  and  only  those 
acts  which  are  plainly  within  its  meaning, 
according  to  the  comm(m  understanding  of 
men,  can  lie  regarded  as  prohibited  criminal 
acts.  We  c  naot  consider,  therefore,  that  a 
mere  undertaking  on  the  part  of  the  carrier 


WHEX  TITLE   PASSES. 


181 


to  collect  the  price  of  the  goods  at  the  time 
of  his  delivery  to  the  purchaser,  though  the 
payment  of  the  price  be  a  condition  of  the 
delivery,  can  sullice  to  convert  the  seller's 
delivery  to  the  carrier  for  transportation  and 
r^ollection  into  a  crime.  We  tlu^rcfore  hold 
that  the  sales  made  by  the  defendant  upon 
orders,  C.  O.  D.,  received  from  the  purchasers 
were  not  in  violation  of  the  criminal  statute 


against  sales  without  license,  and  the  con- 
viction and  sentence  in  the  court  below  must 
be  set  aside.  The  jud^'ment  of  tiie  court  of 
quarter  sessions  is  reversed,  and  the  defend- 
ant is  discharged  from  his  recognizance  up- 
on this  indictment. 

WILLIAMS,  J.,  dissents. 


182 


WHEN  TITLE   TASSES. 


AT  LTMAX.  ^[ILLEK  &  CO.  v.  CLIFFORD. 

(."»(•>  N.  W.  r)!»8,  .".."i  Minn.  159.) 
Supreme  Court   of  Minnesota.      Oct.   27,   1893. 

Appeal  from  (li.strict  court,  Traverse  coun- 
ty;   Brown,  Ju<lse. 

Action  on  a  contract  by  Aultman,  INIiller  & 
■Co.  against  Michael  Clifford.  Defendant  had 
judgment,  and  from  an  order  granting  a  new 
trial  he  appeals.    Reversed. 

A.  S.  Crossfield,  for  appellant.  E.  T. 
"i'oung,  for  respondent. 

■RT'CK,  J.  The  plaintiff  brought  suit  ag  linst 
the  defendant  in  th  •  d  strict  court  for  the  sum 
of  $110,  upon  the  following  described  instiii- 
ment,  viz.:  "July  l.'ith.  1891.  'I  have  this 
day  ordered  of  Aultman.  INIiller  &  Co.  one 
seven-foot  Buckeye  binder,  for  which  I  agree 
to  pay  one  hundred  and  forty  dollars,~note 
for  one  hundred  and  ten  dollars,  and  his  old 
IMcCormick  binder;  three  fall  payment.s,  at 
eight  per  cent.  The  binder  to  be  delivered 
on  or  before  July  2.")th,  1891.'  "  Before  the 
last-named  date  the  parties  substituted  a  six 
foot  binder,  with  bundle  carrier,  in  the  place 
of  the  seven-foot  binder  mentioned  in  the 
original  order,  but  upon  the  same  terms. 
The  defendtmt  refused  to  execute  the  notes, 
for  the  reason  that  the  l)inder  was  not  such 
as  plaintiff  represented  and  warranted  it  to 
be.  In  the  month  of  December  following, 
this  action  was  commenced  for  the  full 
amoimt  of  the  three  notes  mentioned  in  the 
order.  The  defendant  answered,  and  alleged 
that  at  the  time  of  ordering  said  machine, 
and  as  part  of  the  terms  of  tlie  contract  of 
said  purchase,  this  plaintiff  orally  represent- 
ed that  he  would  furnish  a  binder,  to  be  of 
good  material,  well  made,  light  draft,  and 
as  good  as  any  other  machine  manufactured 
for  the  purpose  of  cutting  and  binding  grain, 
and  that  the  binder  so  to  be  furnished  would 
in  fact  cut  and  bind  grain  as  well  as  any 
other  machine  manufactured  for  such  pur- 
po.se;  and  that  defendant,  relying  upon  such 
rei)resentations,  was  thereby  induced  to  give 
such  order.  Upon  the  trial  the  evidence  ful- 
ly sustained  the  contentiofi  of  the  defend- 
ant, and  the  jury  so  found. 

Before  submitting  the  case  to  the  jury,  the 
plaintiff  asked  the  court  to  instruct  the 
jury  to  find  a  verdict  for  plaintiff,  for  the 
reason  that  the  contract  of  sale  in  this  case 
was  in  writing,  and  contained  no  warranty, 
and  that,  therefore,  no  oral  waiTanty  coidd 
be  shown  to  vaiy  the  terms  of  the  written 
<'ontract.  The  court  denied  this  motion,  and 
the  plaintiff  excepted.  Afterwards  the  plain- 
tiff moved  for  a  new  trial,  upon  the  minutes 
of  the  court,  and  it  granted  a  new  trial, 
holding  that  this  case  is  controlled  by  the 
decisions  of  this  court  in  the  case  of  Thomp- 
son V.  Libby,  34  Minn.  374,  26  N.  W.  Rep. 
1.  and  Kessler  v.  Smith,  42  Minn.  494,  44  N. 
W.  Rep.  794.  Nothing  in  this  opinion  is  to 
be  constiii.'d  as  in  any  manner  trenching  up- 
on the  rule  or  doctrine  laid  down  in  those 
cases.    This    was    an    executory    instrument. 


The  plaintiff  had  12  days  in  which  to  fur- 
nish the  binder,  and  the  notes  were  to  be 
executed  in  the  future.  It  does  not  appear 
that  the  binder  was  in  existence  at  the  time 
the  order  was  given.  The  defendant  had 
no  opportunity  to  inspect  it  or  test  its  fitness 
or  capability  for  doing  the  work  for  which 
he  had  ordered  it.  Now,  a  party  receiving 
an  order  for  a  binder  for  doing  a  c(>rtaiu 
kind  of  work  does  not  fulfill  the  conditions 
of  the  order  by  furnishing  a  binder  of  a 
different  kind,  and  which  will  not  do  the 
work  of  the  binder  ordered.  This  is  not  the 
case  of  a  binder  being  present  at  the  time 
the  order  was  given,  and  the  seller  then 
warranting  the  binder  to  do  good  work,  but 
a  case  of  an  executory  instrument,  incom- 
plete on  its  face,  and  not  puri)orting  to  give 
the  whole  of  the  mutual  executory  engage- 
ments of  the  parties.  The  term  "three  fall 
payments,  at  eight  per  cent.."  of  ifllO.  is 
uncertain  and  amliigiioiis.  The  term  "fall," 
when  applied  to  the  seasons  of  the  year,  is 
defined  b.v  Webster  to  mean  "the  season 
when  the  leaves  fall  from  the  trees."  If  the 
word  "fall,"  as  used  in  this  order,  means 
during  the  months  of  Septeml)er,  October, 
and  November,  then  its  ambiguity  is  ap- 
parent, for  in  such  case  it  would  be  payable 
in  some  of  those  months;  biit  whether  Sep- 
tember 1st.  or  the  middle  of  October,  or  the 
last  day  of  November,  there  is  no  legal  way 
of  determining.  The  plaintiff'  might  claim 
that  the  payments  would  each  be  due  the  1st 
day  of  September  of  each  year,  and  the  de- 
fendant Avith  equally  as  much  confidence 
claim  that  they  would  not  be  due  imtil  the 
last  day  of  November  of  each  year,  and  this 
ambiguity  lead  the  parties  into  that  verj' 
litigation  which  the  law  seeks  to  avoid,  by 
recpuring  contracts  to  be  definite  and  cer- 
tain, or,  in  other  words,  complete  contracts 
in  themselves.  If  there  was  no  time  men- 
tioned at  all,  then  it  would  be  understood 
by  the  parties  to  be  a  cash  payment,  or  that 
deliveiy  and  payment  were  to  be  concuiTent 
acts.  In  the  case  of  O'Donnell  v.  Leeman,  43 
Me.  1.18,  an  ins-^rument  of  sale  provided 
that  the  consideration  should  be  one-third 
cash  down,  but  ft  was  silent  as  to  -vvhen" 
the  rest  shoiUd  be  paid,  and  it  was  held  to 
be  an  incomplete  instrument,  and  that  no  ac- 
tion could  be  maintained  upon  it  at  law  or  in 
equity.  In  this  case  there  was  not  that  le- 
gal delivery  or  acceptance  of  the  projierty 
which  passed  tht'  title  to  the  defendant. 
There  was  an  actual  physical  deliveiy  of  the 
binder  to  the  defendant,  and  a  temporary 
use  of  it  by  him.  but  he  did  not  receive  any 
substantial  benefit  from  its  use,  and  return- 
ed it  to  the  premi!/»\s  of  the  plaintiff,  where 
it  was  left,  although  plaintiff  refused  to  ac- 
cept it.  A  delivery  of  property,  so  as  to 
pass  the  title  to  it  tsnd  make  the  transaction 
an  executed  contract,  should  be  a  delivery  of 
the  property  correrponding  with  the  order 
or  contract,  which  *s  a  condition  precedent 
to  the  vesting  of  tht'  title  in  the  vendee.  10 
Amer.  &  Eng.  Enc.  J.aw,  104,  105.    The  writ- 


WHEN  TITLE   PASSES. 


183 


ten  instnimont  or  order  being  incomplete, 
and  not  purporting-  on  its  face  to  express 
the  wliole  of  the  nvutual  agreement  of  tlie 
parties,  parol  evidence  was  admissible  to 
show  an  oral  agreement  on  the  part  of 
plaintiff,  which  constituted  a  condition  on 
which  defendant  gave  the  written  order,  and 
on  wliich  performance  on  his  part  was  to 
depend,  as  that  tlie  binder  should  be  of  a 
certain  quality.    The  jury   must  have  found 


that  the  plaintiff  did  not  in  this  respect  com- 
ply with  his  parol  warranty  and  representa- 
tions, and,  if  not,  then  there  was  not  such 
legal  delivery  and  acceptance  of  the  binder 
by  defendant  as  Ijound  him  to  retain  or  pay 
for  it.  The  oral  evidence  respecting  tlie 
parol  waiTanty  was  properly  admitted,  and 
the  court  below  erred  in  granting  a  new 
trial.  For  this  error  the  order  granting  .such 
new  trial  is  reversed. 


184 


WHEN  TITLE   PASSES. 


HOOVEK  ft  :il.  v.  MAIIER. 

(."3  N.  W.  G4(;,  r,!  Minn.  269.) 

Supreme  Court  of  Mimiesota.      Nov.   12.   1S02. 

Appeal  from  district  court.  Biu:  Stone  couu 
ty;   Brown.  .Fudfie. 

Action  in  tlie  district  court  of  Hennepin 
county  by  Abel  Hoover  and  another,  partners 
as  Hoover  &  (Tand)le,  anainst  .John  Maher  to 
recover  for  jidods  sold.  After  issue  joined, 
the  action  was  removed  to  the  cotmty  of  Bijr 
Stone,  on  demand  for  a  change  of  venue,  and 
submitted  to  the  court  on  an  agreed  state- 
ment of  facts.  Findings  were  thereafter 
tiled,  and  judgment  ordered  for  defendant. 
From  an  order  denying  a  new  trial,  plaintiffs 
appeal.     Affirmed. 

Keith.  Evans,  Thompson  tfe  Fairchild,  for 
appellants.     A.  S.  Crosstield.  for  respondent. 

GILFILLAN,  C.  J.  Action  to  recover  for 
goods  sold.  The  only  question  is,  was  there 
an  executed,  or  only  an  executory,  contract 
of  sale?  The  plaintiffs'  place  of  business 
was  Miamisburg,  Ohio;  the  defendant's, 
Beardsley,  ]\Iiuu.  .June  25,  18!)0,  the  defend- 
ant ttlegraphed  plaintiffs:  "I  Avill  take  4.000 
lb.  of  your  standard  twine,  at  13i/^,  at  Minne- 
apolis, but  don't  want  it  shipped  till  about 
.luly  1.5th."  June  28th  plaintiffs  wrote  de- 
fendant: "Yours  of  25th  to  hand.  \Ve  are 
loading  car  to-day  for  ^linneapolis.  and  will 
put  in  for  you  4,000  lb.  of  our  standard  twine 
at  131/^  c.  frt.,  from  Minneapolis.  The  car 
will  arrive  at  Minneapolis  about  .Tuly  Gth. 
If  you  do  not  want  it  shipped  out  at  that 
time,  please  notify  the  Security  Warehouse 
Company,  Minneapolis.  Minn.,  to  hold  till  you 
want  it;  otlierwi.se  will  instruct  them  to 
sliip  as  soon  as  car  arrives,  and,  if  they  do 
not  hear  from  you,  they  will  do  so."  .June 
30th  plaintiffs  sent  a  bill  for  the  4,000  lbs. 
twine  with  this  notation:  "In  car  load  to 
Security  W.  H.  Co.  Terms,  note  due  Nov.  1, 
'00,  with  8^  interest  after  due."  June  13th 
defendant  w-rote  the  Security  Warehouse: 
"Messrs.  Hoover  &  Gamble,  of  Miaiyisburg, 
Ohio,  are  shipping  twine  to  your  house  for 
me,  and  I  want  you  to  hold  this  twine  until 
I  order  it  out.  It  must  be  held  free  of  charge 
to  me;  if  there  is  any  charge,  you  must 
make  H.  &  G.  stand  it."  .Inly  9th  defend- 
ant Avrote  plaintiff:  "Your  letter  received, 
with  note  inclosed  for  signature.  I  will  at- 
tend to  it  as  soon  as  twine  is  received."  Up- 
on the  telegi-am  of  .June  2.5tli  plaintiff  set 
apart  from  its  stock  4,000  lbs.  of  twine, 
marked  it  with  defendant's  name  addressed 
to  him  at  Beardsley,  sent  it  in  a  car  load  of 
other  twine  in  various  parcels  tagged  and 
addressed  to  various  persons  to  tiie  Security 
Warehouse  Company,  Minneapolis,  where  it 
was  received  prior  to  .July  loth.  July  15th 
the  warehouse,  with  its  contents,  including 
the  4,000  lbs.  of  twine,  was  totally  destroyed 
by  fire. 

Whether,    upim    tlie    foregoing   corresjjond- 


ence,  the  twine  was  to  be  delivei-ed  by  plain- 
tiffs to  d'efendant  at  Beardsley  or  at  INimiie- 
apolis  is  immaterial.  It  is  clear  it  was  not 
intended  the  title  should  pass  to  defendant, 
so  that  he  should  become  liable  for  tue  price, 
until  a  delivery  at  one  place  or  the  other. 
Merely  setting  the  twine  apart  from  plain- 
tiffs' general  stock,  for  the  puii)ose  of  filling 
defendant's  order,  did  not  pass  the  title,  nor 
shipping  it  to  the  Security  Warehouse,  nor 
tlie  receipt  of  it  by  the  warehotise  company, 
for  that  company  was  the  agent  of  the 
plaintiffs.  And  had  that  company  either  ten- 
dered delivery  to  him  jit  Minneapolis,  or  ship- 
I)ed  it  to  him  from  that  place,  prior  lo  the 
time  specified  in  his  order,  he  wotild  have 
been  under  no  obligation  to  receive  it.  ^vnen 
one  orders  goods  to  be  sent  him,  auct  tiiereliy 
makes  the  vendor  his  agent  to  select  and  ap- 
propriate the  specific  aiticles  to  the  contract, 
the  latter  must  do  it  in  the  manner  pre- 
scribed. Thus,  where  the  order  was  to  ship 
the  article  from  a  specified  place  to  the  ven- 
dee, a  shipment  from  another  place  was  held 
not  an  appropriation  of  the  article  to  the  con- 
tract, so  that  the  title  passed.  Jones  v. 
Schneider,  22  Minn.  279.  Of  course,  the  ven- 
dee, when  authorizing  the  vendor  to  make 
the  appropriation,  may  attach  a  condition  as 
to  time,  as  the  defendant  did  in  this  case,  as 
well  as  .any  other  condition.  The  plaintiffs 
did  not  observe  that  condition.  The  defend- 
ant might  waive  compliance  with  the  condi- 
tion; might  take  such  action  as  would  make 
a  constructive  delivery,  without  actually  re- 
ceiving the  twine  from  the  warehouse  com- 
pany, as  if  he  had  consented  that  the  com- 
pany should  thereafter  hold  it  for  him;  and 
plaiutitt's  claim  that  he  did  so  by  his  letter  to 
the  company  of  June  30th.  ^\  hen  that  let- 
ter is  read  in  connection  with  the  order,  and 
plaintiff's"  letter  of  Jxme  28th,  it  would  be  do- 
ing violence  to  it  to  construe  it  to  be  a  con- 
sent, as  between  plaintiffs  and  defendant,  to 
waive  the  condition  of  the  order  as  to  time, 
and  to  have  tlie  warehouse  company  hold  the 
twine  thereafter  on  account  of  defendant  in- 
stead of  on  account  of  plaintiffs.  Had  it 
been  written  without  any  suggestion  of  plain- 
tiffs that  might  be  claimed  as  its  effect.  But 
they,  for  their  own  convenience,  had  shipped 
the  twine  from  Miamisburg,  so  that  it  would 
arrive  at  Minneapolis  before  the  time  when 
defendant  Avould  be  ready  to  receive  it  ac- 
cording to  his  order,  and,  assuming  that  he 
might  waive  the  matter  of  time  and  consent 
to  its  shipment  to  him  from  ^linneapolis  as 
soon  as  it  arrived  there,  the  plaintiffs  wrote 
their  letter  of  June  28th,  re(iuesting  him,  in 
case  he  did  not  so  consent,  to  do  just  what 
he  did,— to  notify  the  warehouse  company, 
the  agent  of  plaintiff's,  to  hold  it  till  he  shoiild 
want  it.  Neither  ]-»arty  could  have  under- 
stood that  notification  to  be  a  consent  to  re- 
ceive the  twine  before  the  time  when  he 
would  have  received  it  had  it  been  shijiped 
as  directed  by  the  order.     Order  affirmed. 


WHEN  TITLE   PASSES. 


1S5- 


CRANE  V.  WILSON  ot  al. 

(G3  N.  W.  500.) 

Supreme   Court   of   Michigan.      May   28,   1895. 

Error  to  circuit  court,  Bay  county;  An- 
drew C.  Maxwell,  Judge. 

Action  by  Hiram  A.  Crane  a5,^ainst  Filzland 
L.  AVilson  and  others,  as  the  Wilson  Hoop 
Company,  for  the  contract  price  of  goods 
sold.  From  a  judgment  for  plaintiff,  defend- 
ants bring  error.    Reversed. 

L.  E.  Joslyn  (H.  H.  Hatch,  of  counsel),  for 
appellants.  Pratt,  Van  Kleeck  &  Gilbert,  for 
jippellee. 

LONG,  J.  Plaintiff  and  one  Hart  entered 
into  a  written  contract  with  the  defendants, 
as  the  Wilson  Hoop  Company,  to  "deliver  in 
the  boom  limits  of  the  Bay  View  Boom  Com- 
pany, below  M.  Haggerty's  boom,"  one  to 
three  hundred  thousand  feet  of  elm  logs,  12 
inches  in  diameter  and  upwards.  The  logs 
were  to  be  banked  at  a  certain  place  men- 
tioned in  the  contract.  The  contract  pro- 
vided that,  in  consideration  of  the  faithful 
performance  of  the  agreement,  the  Wilson 
Hoop  Company  was  to  pay  to  Hart  &  Crane 
.$().50  per  1,000  feet,  as  follows:  $2.75  when 
the  logs  were  delivered  on  the  bank,  and 
$3.75  Avhen  the  logs  were  delivered  in  the 
Bay  View  boom,  rafted  in  good  shape,  as 
l)rovided  above.  The  contract  provided,  as 
to  time  of  delivery,  as  follows:  "The  party 
of  the  first  part  further  agrees  to  run  said 
logs  down  the  boom  limits  just  as  early  as 
possible  in  the  spring  of  1891;  if  possible, 
before  or  ahead  of  the  drive."  The  contract 
was  assigned  to  the  plaintiff  in  this  suit. 
He  claims  to  have  delivered  on  the  bank 
111,118  feet  of  contract  logs;  that,  after  they 
were  scaled,  all  were  rafted  that  defendants 
furnished  chain  dogs  for;  that  they  were 
run  to  the  Bay  View  boom,  the  greater  part 
in  1891;  that  those  not  run  remained  in  the 
jam  the  following  winter,  and  were  run  the 
next  season;  that  he  had  received  $2.75  per 
1,000,  according  to  the  contract,  for  111,118 
feet;  and  that  the  balance  of  the  contract 
price  was  still  due.  This  action  is  brought 
to  recover  such  balance.     On  the  trial,   de- 


fendant contended  that  under  the  contract 
it  was  not  bound  to  receive  the  logs  deliver- 
ed after  the  season  of  1891;  that  the  logs 
were  for  manufacture  into  hoops,  and  must 
be  green  timber;  that  the  logs  remaining  over 
the  sen  sou  exposed  to  the  sun  were  spoiled 
for  lioops;  and  that  the  contract  limited  the 
time  in  which  they  were  to  be  received  to 
the  season  of  1891. 

The  court  charged  the  jury  that:  "If  the 
logs  came  down,  and  were  delivered  to  the 
defendants,  in  the  boom  company  limits  l)e- 
low  Haggerty's  boom,  either  in  the  year  1891 
or  1892,  they  would  be  bound  to  take  them. 
*  *  *  They  would  be  bound  to  pay  for 
them,  whether  they  took  them  or  not,  if  they 
were  put  down  there  for  them."  This  raises 
the  only  question  which  we  need  discuss. 
The  contract,  in  very  plain  terms,  limits  th(> 
time  of  delivery  to  the  season  of  1891.  It  is 
true  that  in  an  agreement  which  calls  for 
delivery  by  a  certain  time,  and  delivery  is 
not  made  by  such  time,  a  subsequent  deliv- 
ery will  be  binding,  provided  the  party  to 
whom  the  delivery  is  to  be  made  accepts  and 
retains  the  property,  as  such  acceptance  is 
a  waiver  of  the  terms  of  the  contract,  so  far 
as  the  time  is  concerned,  and  is  evidence  of 
a  new  contract,  fixing  a  different  time;  and 
it  is  true  that  the  plaintiff  claimed  that  the 
defendant  did  accept  delivery  at  a  time  later 
than  the  time  mentioned  in  the  contract. 
But  this  was  in  dispute  between  the  parties. 
as  the  defendant  contended  that  it  had  not 
accepted  them.  The  testimony  was  confiict- 
ing  on  this  point.  The  court,  however,  ex- 
plicitly instructed  the  jury  that  the  defend- 
ants were  bound  to  take  them,  even  if  not 
delivered  until  the  year  1892.  It  was  a  (pies- 
tion  of  fact,  for  the  jury  to  determine,  wheth- 
er there  was  an  acceptance  of  the  logs  of 
1892.  If  there  was  no  such  acceptance,  or 
waiver  of  the  time  of  delivery,  then,  luider 
the  terms  of  the  contract,  the  plaintiff  could 
not  insist  upon  the  defendants  taking  the 
logs  of  1892.  The  court  was  in  error  in  the 
chai-ge.  The  parties  had  reduced  their  con- 
tract to  writing,  and  nmst  be  bound  by  its 
terms.  The  judgment  must  be  reversed,  and 
a,  new  trinl  granted.  The  other  justices  con- 
curred. 


186 


WHEN  TITLE   PASSES. 


WHEELHOUSE  v.  PARR. 

(6  N.  E.  787,  141  Mass.  593.) 

Supreme  Judicial   Court  of  Massachusetts. 
Middlesex.     May  8,  188G. 

This  was  an  action  of  contract  to  recover 
?440.22  for  a  lot  of  leather  sold  to  defend- 
ant. Hearing  in  the  superior  court,  which 
found  for  the  plaintiff,  and  the  defendant 
appealed.    The  facts  appear  in  the  opinion. 

F.  VV.  Qua  and  F.  P.  Marble,  for  plaintiff. 
"Wm.  H.  Anderson,  for  defendant. 


DEVENS.  J.  When  goods  ordered  and 
contracted  for  are  not  directly  delivered  to 
the  purchaser,  but  are  to  be  sent  to  him  by 
the  vendor,  and  the  vendor  delivers  them 
to  the  carrier,  to  be  transported  in  the  mode 
agreed  on  by  the  parties,  or  directed  by  the 
purchaser;  or  when  no  agreement  is  made, 
or  direction  given,  to  Oe  transported  in  the 
usual  mode;  or  when  the  purchase!",  being 
informed  of  the  mode  of  transportation,  as- 
sents to  it;  or  when  there  have  been  previ- 
ous sales  of  other  goods  to  the  transportation 
of  which,  in  a  similar  manner,  the  purchaser 
has  not  objected, — the  goods,  when  deliver- 
ed to  the  carrier,  are  at  the  risk  of  the  pur- 
chaser, and  the  property  is  deemed  to  be 
vested  in  him  subject  to  the  vendor's  right 
of  stoppage  in  transitu.  This  proposition  as- 
.sumes  tliat  proper  directions  and  informa- 
tion ai'e  given  to  the  carrier  as  to  forward- 
ing the  goods.  AVhiting  v.  Farrand,  1  Conn. 
GO;  Quimby  v.  Carr,  7  Allen,  417;  Finn  v. 
Clark.  10  Allen.  484:  Finn  v.  Clark.  12  Al- 
len, .522;  Downer  v.  Thompson,  2  Hill,  137; 
Foster  v.  Itockwell.  1(H  Mass.  170;  Odell 
V.  Railroad,  100  Mass.  50;  Wigton  v.  Bow- 
ley,  130  Mass.  2.52. 

The  defendant  had  made  a  purchase  of 
leather  in  November  previously  to  the  pur- 
chase of  that  the  price  of  which  is  in  con- 
troversy, under  a  direction  to  the  plaintiff 
to  "ship  to  care  of  D.  and  C.  Mclver,  ship- 
ping merchants,  Liverpool,  as  soon  as  pos- 
sible, for  their  next  steamer  to  Boston,  di- 
rect." This  shipment  was  made  as  ordered, 
and  on  December  10,  1884,  the  defendant 
sent  a  further  order  saying:  "As  regards 
the  shipping  of  the  leather  just  received, 
you  have  done  everything  .satisfactory-.  Ship 
this  order  in  like  manner." 

The  directions  by  which  the  plaintiff  was 
to  be  controlled  nmst  be  interpreted  as  re- 
quiring him  to  forward  the  goods  to  D.  & 
C.  Mclver,  to  be  transported  by  them  by  the 
Cunard  line,  of  which  they  were  managers 
and  agents.  The  words  "their  next  steam- 
er" could  not  have  meant  any  steamer  which 
would  accept  freight  from  D.  &  C.  Mclver. 
Cases  may  be  readily  imagined  wliere  these 
words  would  be  of  the  highest  importance; 


as  if  the  defendant  had  an  open  policy  of 
insurance  protecting  his  goods  which  might 
be  sent  by  the  Cunard  line.  It  might  also 
be  true  that  the  defendant  would  not  deem 
a  policy  of  insurance  necessary  when  goods 
were  sent  by  a  well-established  passenger 
line,  where  greater  precautions  might  prob- 
ably be  taken  for  safety,  which  he  would 
deem  necessary  when  they  were  sent  by  a 
purely  freighting  steamer.  The  goods  were 
actually  forwarded  to  D.  &  C.  Mclvei-,  with 
instructions  in  conformity  Avith  the  direc- 
tions of  the  defendant,  and,  had  the  mat- 
ter ended  there,  so  far  as  any  directions  to 
D.  &  C.  Mclver  is  concerned,  the  plaintiff 
would  be  entitled  to  treat  them  as  delivered 
to  the  defendant,  and  to  require  him  to  pay 
the  purchase  money.  If,  on  the  other  hand, 
while  the  goods  were  yet  in  the  hands  of  the 
carrier,  and  before  transportation  of  them 
had  commencetl,  the  plaintiff  changed  the 
directions  given  to  him  by  the  defendant, 
or  authorized  the  carrier  to  transport  them 
in  a  different  mode  fix^m  that  directed  by 
the  defendant,  and  loss  has  thereby  occur- 
red, he  cannot  contend  that  they  were  de- 
livered to  the  defendant  by  him.  By  con- 
tinuing to  exercise  dominion  over  them,  and 
by  giving  a  new  direction,  impliedly  with- 
drawing the  directions  previously  given,  he 
cannot  be  allowed  to  assert  that  he  had 
made  a  complete  delivery  by  his  original  act. 
if  a  loss  lias  occurred  by  reason  of  that 
which  he  has  subsequently  done  or  dii'ected. 
The  change  in  the  directions  given  relates 
back  to  and  qualities  the  original  delivery. 

The  plaintiff,  in  answer  to  a  letter  from 
D.  &  C.  Mclver,  after  the  goods  had  reached 
them,  inquiring  whether  they  were  to  keep 
the  goods  "for  our  steamer,  14th  inst.,  or 
ship  by  the  Glamorgan,"  ordered  them  to  be 
shipped  by  the  steamer  arriving  out  first, 
presumal)ly  the  steamer  which  D.  &  C.  Mc- 
lver believetl  would  be  the  first  to  arrive. 
The  Glamorgan  was  not  a  steamer  of  any 
line  of  which  D.  &  C.  Mclver  were  owners 
or  agents,  and  in  no  way  answers  the  de- 
scription of  "their  steamer"  as  applied  to  D. 
&  C.  Mclver.  By  neglecting  to  limit  the 
authority  of  D.  &  C.  Mclver  to  send  by  a 
steamer  which  could  be  thus  descril)ed,  and 
by  directing  them  to  send  by  the  steamer 
which  would  first  arrive,  the  plaintiff"  had 
failed  to  comply  with  the  orders  of  the  de- 
fendant as  to  the  shipment  of  goods:  and  if 
correct  directions  had  originally  been  given, 
had  withdrawn  them,  and  substituted  others. 
When,  therefore,  exercising  the  autliority 
thus  given  by  the  plaintiff,  D.  &  C.  Mclver 
send  by  the  Glamorgan,  as  being,  in  their 
judgment,  the  steamer  likely  to  arrive  first, 
and  a  loss  occurs,  it  should  not  be  borne  by 
the  defendant,  whose  directions  have  not 
been  followed.    .Judgment  for  the  defendant. 


WHl-:.\   TITLE    PASSES. 


187 


COMSTOCK   et  al.   v.    SANGER   ct   al. 

(16  N.  W.  872,  r.l   Mi.h.  4117.) 

Supreme    Court    of    Miehigau.     Oct.    17.    1883. 

Keatiua:  «.V:  Dickermau  and  Markhani  iVi 
Xoves,  for  auuellants.  Norris  «&  Ulil.  for  an 
Dellee. 

COOLEY.  J.  Assumpsit  to  recover  the  price 
of  luml)er  sold.  On  August  2(i.  18S1,  Mr. 
Chauucy  Pettibone,  as  agent  for  the  defend- 
ants, entered  into  a  contract  with  the  plain 
tiffs,  of  which  they  gave  him  the  memor;ni- 
dam  copied  in  the  margin. i  The  plaintiffs 
commenced  making  deliveiy  on  the  contract, 
and  prior  to  October  4,  ISSl,  had  delivered 
upwards  of  4(^),()()0  feet  of  lumber  in  Milwau- 
kee: and  sutticieut  in  Muskegon  to  make  up  a 
total  of  759.023  feet.  Mr.  Pettibone  had  at- 
tended to  the  receipt  of  the  lumber  at  Muske- 
gon, and  tally  sheets  had  been  given,  showing 
the  quantity  of  the  several  sizes.  It  will  ap- 
pear that  only  a  fraction  over  40,000  feet  was 
then  required  to  make  up  800.000  when,  on 
the  day  last  named,  a  vessel,  the  R.  P.  Ma- 
son, was  waiting  at  Muskegon  to  be  loaded. 
But  though  the  whole  quantity  was  so  nearly 
supplied,  it  is  shown  that  of  the  special  sizes 
mentioned  in  the  contract  much  more  than 
40.000  feet  had  not  been  delivered.  These 
sizes  were  of  more  value  than  the  ordinary 
run  of  the  lumber,  and  were  not  always  readi- 
ly obtainable,  and  much  lumber  of  imusual 
sizes,  but  not  corresponding  to  the  sizes  si^eci- 
fied  in  the  contract,  appear  to  have  been  deliv- 
ered from  time  to  time,  without  objection  by 
either  party,  and  without  any  expressed  un- 
<lerstanding  respecting  them. 

When  the  R.  P.  Mason  commenced  to  load, 

1  Muskegon.  August  2G.  1881. 

Messrs.  Sanger,  Rockwell  &  Co..  Milwaukee. 
Wis. — Gentlemen:  Sold  you  to-day  two  cargoes 
of  lumber,  of  about  400,000  feet  each,  into 
which  we  will  put  100  pes.  8x8-14;  50  pes. 
8x8-lG:  40  pes.  8x10-18:  30  pes.  8x10-10:  40 
lies. 8x10-18:  20  pes.  10x10-12:  4n  pes. 1(1x10-14: 
00  pes.  10x10-10:  40  pes.  10x10-18:  30  pes. 
10x10-20:  30  pes.  10x10-22;  20  pes.  12x12-12; 
20  pes.  12x12-14:  10  pes.  12x12-10;  20  pes. 
12x12-18:  30  pes.  12x12-20;  30  pes.  12x12-22; 
2(10  pes.  2x12-18;  500  pes.  2x12-22;  500  pes. 
2x12-24;  200  pes.  2x12-20;  400  pes.  2x6-22; 
4(J0  pes.  2x10-20;  200  pes.  2x16-28;  10  pes. 
10x12-12;  10  pes.  10x12-14;  10  pes.  10x12-10; 
10  pes.  10x12-18;  40  pes.  10x12-20;  40  pes. 
10x12-22;  3,500  pes.  2x4-18;  1.000  pes.  2x4-20. 
Should  we  be  unable  to  furnish  tlie  amount  of 
2x12-24  named,  we  will  furnish  you  same 
amount  cut  to  other  sizes  as  you  may  wish. 
Will  ship  one  cargo  within  10  days,  and  the  sec- 
ond within  30  days.  Lumber  to  lie  sound  mer- 
chautal)le  himber.  excluding  lengths  under  10 
feet.  Lumber  to  be  insjieeted  and  tallied  by 
W.  MeCnllum.  The  price  of  first  cargo  to  be 
J*^ll.  delivered  to  you  in  Milwaukee,  and  of  the 
second  $9.50,  on  dock  here.  Terms  of  sale, 
cash.  Provided  we  are  unable  to  furnish  the 
t'xaet  mmiber  of  pieces  of  lengths  above  20,  no 
damage  shall  accrue,  but  in  any  event  we  will 
furnish  75  per  cent,  of  each  kind   named. 

D.  F.  Comstock  A:  Co. 

We  are  to  pay  one-half  tally  on  this  lot. 

Ppttibone. 


then,  the  situation  was  this:    The  whole  quan- 
tity was  delivered,  with  the  exception  of  about 
4<),000  feet,   and   the  deliveiy   of  special   sizes 
was    so    far    short    that    if    the    whole   40,000 
should  be  of  those  sizes  there  would  still  be  a 
large  deticiency.      It  might  be  expected,  there- 
fore, that  if  defendants  propo.sed  to  insist  upon 
literal     compliance     with    the    contract,     they 
would  then  decline  to  receive  any  lumber  not 
of  the  special  sizes.     So   far  were  they  from 
doing  this,  that  the  R.  1'.  Mason  was  loaded 
with  lumber  as    it   was  ctmvenient  to   take   it 
from  piles  on  the  dock,  and  the  load  swelled 
the  total   reci'ipts   to   934.557   feet.     This   was 
done  under  the  supervision  of  Pettibone.  who 
appears  to  have  endeavored  to  obmin  what  he 
;  could  of  the  sixH-ial  sizes,  but  made  no  protest 
against  receiving  other  lumljer.     The  quantity 
of  the  .special   sizes  then  deficient   wiis  about 
I  135.000  feet,  according  to  Pettiboue's  estimate. 
I  AVhen  the  vessel  was  loaded,  Pettibone  called 
the  attention  of  the  plaintiff's  to  the  fact  that 
I  the  quantity  taken  largely  exceeded  that  which 
I  defendants  had  bargained  for,  and  he  claimtHl 
I  that  for  the  exc-ess  over  80O.(XX)  feet   the  de- 
I  fendants  ought  not  to  pay  the  contract  price. 
i  Plaintiffs,    according   to    their    evidence,    then 
agreed  with  him  that  the  price  for  this  excess 
should  be  nine  dollars  a  thousand  feet,  while. 
according   to   his   evidence,   plaintiffs  proposed 
to  take  nine  dollars,  and  he  made  no  response. 
Pettiboue's  evidence  on  the  subject  is  as  fol- 
lows : 

"The  captain  lixed  the  loading  himself. 
After  the  loading  of  the  R.  P.  Mason  on  one 
of  t^e  docks, — I  can't  say  whether  it  was  be- 
fore or  after  I  received  the  tally  sheets;  I 
should  say  it  was  before.— I  stated  to  ilr. 
Comstock,  in  substance,  that  if,  in  order  to 
get  in  the  amount  of  those  special  sizes  that 
he  had  contracted  to  furnish  us,  there  was  evi- 
dently a  good  deal  of  other  length  that  got  in. 
that  would  swell  the  total  to  a  great  deal  more 
than  the  800,000  feet,  and  that  we  did  not 
want  them  at  the  same  price;  that  piece  stuff' 
was  lower.  Comstock  adnntted  the  fact  that 
there  would  be  more  than  800.000  in  order  to 
secure  the  special  sizes  that  we  wished,  and 
said  that  he  wotild  allow  us  half  a  dollar. 
That  was  his  offer.  I  made  no  reply  to  that. 
I  did  not  accept  his  proposition.  I  wouldn't 
swear  that  at  that  particular  time  it  was 
spoken  of  about  his  furnishing  the  balance  of 
the  piece  stuff  named  in  the  contract." 

Plaintiffs  claim  that  performance  on  their 
part  was  completed  when  the  R.  P.  ^Lasou 
was  loaded,  and  that  they  were  entitled  to  the 
contract  prices  for  8O0.tX)O  feet,  anu  nine  dol- 
lars a  thousand  for  the  excess,  luider  their 
agieement  with  Pettibone.  Defendants  de- 
nied that  they  had  agreed  with  Pettibone  up- 
on the  price  for  the  excess,  but  insisted  upon 
their  right  to  receive  the  135.(XtO  feet  of  spe- 
cial sizes  which  were  deficient.  Evidence  was 
put  in  of  attempts  by  plaintiffs  to  obtain  pay- 
ment of  the  balance  due  them,  according  to 
their  claims,  and  by  defendants  to  secure  the 
special   sizes  of  lumber;    all  of   which   i)roved 


188 


wiii':n  title  passes. 


iuefifec'tual.  It  was  shown  that  plaintiffs 
made  some  effort  afterwards  to  i)ro(au'e  the 
special  sizes  for  defendants,  without  avail; 
but  wliether  this  was  in  reeofmitiou  of  a  ri.tjlit 
in  defendants  to  receive  them,  but  merely  to 
.avoid  litiiration.  was  made  a  question.  The 
circuit  judye  submitted  the  evidence  on  this 
subject  to  the  jury,  expressing  his  own  opin- 
ion, however,  that  neither  party  was  shown 
to  have  done  anything  after  the  K.  P.  Mason 
loaded  which  would  constitute  a  waiver  of 
rights.  At  tlie  reciuest  of  the  plaintiff  lie 
gave  the  following  instructions: 

"If  the  jury  find  that  when  the  K.  P.  Mason 
was  loaded  it  was  discovered  that  her  load, 
with  what  had  before  that  been  received  by 
the  defendants,  exceeded  the  S< (0.000  feet  men- 
tioned in  the  contract  by  13-j..j:j(>  feet,  as  per 
the  taUy  sheets,  and  that  thereupon  the  agent 
of  the  defendants.  Mr.  Pettibone.  objected  to 
paying  the  contract  price  of  $9..j0  upon  such 
excess,  as  it  exceeded  the  amount  contemplat- 
ed by  the  contract,  and  it  was  then  and  there 
agreed  between  the  said  Pettil)one  and  plain- 
tiff Chester  W.  Comstock,  as  a  compromise 
and  adjustment  touching  the  lumber  received 
and  agi-eed  to  be  received  under  the  contract, 
that  such  excess  of  135,530  feet  should  be 
cliarged  at  nine  dollars  per  thousand  only, 
rlien.  although  the  entire  amount  of  93.J..530 
feet  actually  receiA-ed  by  the  defendants,  and 
by  them  appropriated  to  their  own  use.  was 
not.  in  every  respect,  sawed  into  the  particular 
lengths  and  sizes  specified  in  the  contract,  the 
df^fiudants  will  not  be  allowed  to  recoup  by 
reason  thereof,  but  will  lie  held  to  pay  for  the 
lumber  so  received  and  retained  by  them." 

"The  contract  provided  that  out  of  the  800,- 
OCK)  feet  contracted  to  be  sold  a  certain  por- 
tion should  be  cut  into  certain  specified  sizes 
and  lengths,  and  it  was  the  pi'ivilege  of  the 
defendants  to  insist  upon  strict  compliance 
therewith  or  to  waive  the  same.  It  was  their 
privilege,  as  the  lumber  was  delivered  to  them 
from  time  to  time  on  the  dock,  to  refuse  to  re- 
ceive any  portion  that  did  not  satisfy  the  con- 
tract; and  if.  with  eveiy  opportunity  afforded 
to  inspect  the  same,  and  if.  when  the  last 
cargo  was  loaded,  they  had  full  knowledge 
that  the  entire  (juantitj-  contemplated  by  the 
contract  would  be  thereby  I'eceived,  and  that 
there  was  an  excess  of  certain  sizes  and 
lengths,  and  a  shortage  as  to  other  sizes  and 
lengths,  and  they  saw  fit  to  accept  the  same 
in  satisfaction  of  the  contract,  they  cannot  re- 
covei-  on  account  of  such  shortage." 

It  is  contended  on  the  part  of  the  defense 
that  there  was  no  evidence  in  the  case  which 
wai'ranted  sul)mitting  to  the  jury  tlie  question 
of  compromise  as  the  judge  submitted  it,  and 
no  evidence  showing  any  waiver  by  defend- 
ants of  their  right  to  the  remainder  of  the 
special  sizes.  We  think  there  not  only  was 
such  evidenc-e,  but  that  it  was  so  c-ondnsive 
in  its  nature  that  but  one  deduction  could  be 
made  from  it. 

It  is  true  that  in  the  talk  between  Pettibone 
and  the  plaintiffs  after  the  loading  of  the  K. 


P.  Mason,  the  word  "compromise,"  or  pe)'- 
haps  any  equivalent  word,  is  not  shown  to  have 
been  made  use  of,  but  what  they  were  speak- 
ing of  is  seen  to  have  been  a  delivered  sur- 
plus above  the  contract  quantity,  and  it  is 
only  in  respect  to  this  that  there  is  any  allu- 
sion to  an  open  question.  The  800,000  feet 
had  been  delivered  and  received;  it  did  not  in 
all  resp(H-ts  comply  with  the  contract,  but  it 
had  nevertheless  been  taken  without,  so  far 
as  appears,  any  protest  or  any  reservation  of  a 
right  to  question  afterwards  its  having  been 
received  under  the  contract.  A  large  excess 
had  also  been  received,  and  Pettibone  claimed 
that  this  liad  happened  because  they  would  not 
otherwise  get  the  special  sizes  the  contract 
called  for.  For  this  reason,  and  also  because, 
as  he  said,  there  had  been  a  decline  in  prices, 
he  insisted  there  should  be  an  abatement. 
But  it  does  not  appear  that  any  excess  was  in 
the  mind  of  either  party  except  the  existing 
excess  over  S*M),000  feet,  nor  did  Pettibone  at 
the  time  put  forward  a  claim  to  the  special 
sizes  not  yet  delivered.  If  those  special  sizes 
were  still  to  be  received,  the  existing  large 
excess  would  be  doubled,  and  there  would  be 
the  same  reason  for  making  a  deduction  for 
the  added  excess  as  for  that  already  had. 
But  nothing  said  by  either  party  at  this  time 
gives  any  indication  that  either  of  them  had 
in  mind  any  increase  to  take  place  afterwards 
in  the  existing  excess. 

It  appears,  then,  that  the  full  contract  quan- 
tity had  been  delivered  by  plaintiffs,  and  been 
received  by  defendants  under  the  supervision 
of  defendants;  and  though  the  special  sizes 
did  not  correspond  to  those  specified  in  the 
contract,  there  had  been  no  protest  against  the 
receipt,  and  no  reservation  of  a  right  to  ob- 
ject afterwards  to  any  of  it.  Wlien  the  final 
load  was  taken,  defendants,  by  their  agent, 
did  complain  that  an  excess  had  been  thrown 
upon  them,  in  consequence  of  the  practical 
difficulty  in  reaching  the  special  sizes  in  any 
other  way:  and,  in  respect  to  this  excess,  an 
abatement  in  price  was  insisted  upon  as  rea- 
sonable. No  further  claim  was  then  made, 
and,  so  far  as  the  evidence  goes,  there  was 
nothmg  to  then  apprise  the  plaintiffs  that  de- 
fendants disputed  having  received  any  part  of 
the  800.000  feet  of  lumber  under  the  contract. 

But  even  if  defendants  had  then  insisted,  at 
that  time,  upon  a  right  to  ff»rther  delivery  of 
si:>ecial  sizeCi  of  lumber,  we  see  no  ground  on 
which  they  could  have  been  entitled  to  it. 
They  had  ali'eady  received  the  full  (luantity, 
and  any  difference  between  what  they  liad  a 
right  to  demand  and  what,  they  had  actually 
received  was  waived  by  the  reception  without 
protest.  This  is  a  mle  of  justice  as  well  as 
law.  Parker  v.  Palmer,  4  Barn.  &  Aid.  387; 
Chapman  v.  Morton,  11  Mees.  &  W.  .534; 
lieed  v.  Randall.  29  \.  Y.  3.58;  Manufacturing 
Co.  V.  Allen,  53  N.  Y.  515;  Barton  v.  Kane, 
17  Wis.  37;  18  Wis.  264;  Watkins  v.  Paine, 
57  Ga.  50.  The  contract  in  law  had  been 
complied  with;  and.  though  the  performance 
was  not  exact,   it  had   l)een   accepted.      If   tlie 


WHEN  TITLE   PASSES. 


189 


jury  had  found  otherwise,  it  would  have  beeu 
the  duty  of  the  court  to  set  aside  their  verdict 
as  unwarranted.  As  to  the  excess  over  S(X),- 
(.HiO  feet,  it  is  of  no  importMice  in  this  case 
whether  Pettibone  did  or  did  uot  agree  to  the 
price  the  plaiutiffs  uamed,  as  it  appears  with- 


out dispute  the  luuiljer  was  wurtli  that  price; 
aud.  iu  tlie  abseuce  of  any  a;.?reeuieut  upon  the 


price,    the   vahie   must  govern. 

the    case    disposes    of    it,    and 

must   be  attirnied.    with   costs. 

The  other  justices  concurred. 


This   view   of 
tlie    judgment 


190 


WHEN  TITLE  PASSES. 


PALMKR  V.  BAXFIELD. 
(5G  N.  W.  1()'J(»,  SO  Wis.  441.) 

Supreme  Court  of  Wisconsin.      Nov.   2S,  1893. 

Appeal  from  circuit  court,  Grant  county; 
Gcorjje  Clenioutson,  Judge. 

Action  by  Jolin  Palmer,  Jr.,  against  Thom- 
as Banliekl.  From  a  judgment  for  plaintiff, 
defendant  appeals.      Attirmed. 

The  other  facts  fully  appear  in  the  follow- 
ing statement  bj^  LYON,  C.  J.: 

This  action  is  to  recover  the  price  of  a 
reai)er  and  harvester  alleged  to  have  been 
sold  and  delivered  by  plaintitf  to  defendant 
in  August,  18!:k2,  for  the  agreed  price  of  .$110. 
The  complaint  states  the  contract  to  have 
been  that  defendant  should  on  demand  give 
plaintiff  for  the  price  of  the  machine  his  two 
promissory  notes  for  ^~m  each, — one  payable 
in  one  year,  and  the  otlun-  in  two  years,  from 
the  date  of  sale,  with  interest.  It  is  fur- 
ther alleged  in  the  complaint  that  defendant 
took,  used,  and  accepted  the  machine,  and 
that  on  due  demand  by  plaintift",  made  be- 
fore the  action  was  commenced,  that  de- 
fendant execute  such  notes,  the  latter  re- 
fused to  do  so.  In  his  answer  defendant  de- 
nies that  the  parties  made  the  agreement  al- 
leged in  the  complaint,  and  avers  that  the 
only  agreement  made  in  respect  to  the  ma- 
chine (which  is  referred  to  in  the  answer 
as  a  harvester  and  binder)  was  as  follows: 
"The  defendant  was  to  take  and  did  take 
said  binder  to  try  and  use  in  his  harvesting 
for  the  years  1892  and  1803,  and  that,  if 
said  harvester  and  binder  did  the  work  satis- 
factorily to  this  defendant  during  said  two 
harvests,  then,  in  that  event,  said  defendant 
was  to  pay  said  plaintiff  the  sum  of  .'J!r>.">  after 
the  harvest  of  1893.  and  the  further  sum  of 
.$ r>.j  in  the  fall  of  1894,  and  not  otherwise."  The 
answer  further  alleges  that  on  a  fair  trial 
of  the  machine  it  failed  to  work  satisfactori- 
ly to  defendant,  and  failed  to  do  good  work, 
whereupon  he  immediately  returned  it  to 
plaintiff.  The  answer  also  contains  a  coim- 
terclaim  for  $2o  damages  for  "trouble  and 
expense  by  reason  of  said  harvester  and 
binder  failing  to  work  satisfactorily  to  the 
defendant."  The  cause  was  tried  before  the 
court  and  jury.  The  testimony  of  plaintiff 
tends  to  prove  the  allegations  of  the  com- 
plaint, and  that  of  defendant  tends  to  prove 
the  allegations  of  the  answer.  It  appears 
by  the  testimony  that  the  machine  was  deliv- 
ered to  defendant  on  a  certain  Thursday  aft- 
ernoon, and  was  immediately  put  to  work, 
and  developed  some  defects  in  its  construc- 
tian.  That  defendant  used  it  through  Fri- 
day, and  discovered  other  defects  going  to 
the  capacity  of  the  machine  and  the  principle 
upon  which  it  was  constructed.  The  testi- 
mony tends  strongly  to  show,  if  it  does  not 
prove  conclusively,  that  as  early  as  Friday 
defendant  had  discovered  all  the  defects  in 
the  machine,  was  dissatisfied  with  it,  and 
had  decided  to  return  it.  However,  he  used 
the  machine  nearly  all  day  on  Saturday,  and 
until  he  had  finished  cutting  his  grain,  and 


then  sent  it  to  Cuba  City,  ly,  miles  distant. 
where  plaintiff  had  a  place  of  busines.s,  and 
it  was  left  on  a  vacant  lot  formerly  occupied 
by  plaintiff.  The  plaintiff  never  accepted 
return  of  the  machine,  and  has  had  nothing; 
to  do  with  it  since  such  attempt  to  return  it. 
The  court  refused  to  give  the  following  in- 
structions proposed  on  behalf  of  defendant: 
"(1)  When  machinery  is  guarantied  to  do 
certain  work  in  a  satisfactory  manner,  ami 
not  to  be  paid  for  until  satisfactory  to  the 
purchaser,  if  it  is  in  good  faith  unsatisfac- 
tory to  him,  and  he  notifies  the  vendor  of 
that  fact  within  a  reasonaljle  time,  there  is 
no  sale.  (2)  If  you  find  that  the  contract 
was  that  the  binder  was  to  do  work  to 
the  satisfaction  of  the  defendant,  and  that 
the  defendant  made  an  honest  effort  to  make 
said  binder  do  good  work,  and  if  the  de- 
fendant within  a  reasonable  time  returned 
the  binder  to  plaintiff"  because  he  was  in 
good  faith  dissatisfied  with  the  binder,  thi>n 
your  verdict  shall  be  in  favor  of  the  defend- 
ant. (3)  If  the  jurj'  find  in  favor  of  the  de- 
fendant, they  may  also  find  such,  damages, 
if  any,  that  he  may  have  suffered  by  reason 
of  the  failure  of  the  binder  to  do  the  worl; 
agreed  that  it  would  do  by  the  contract." 
The  court  submitted  it  to  the  jury  to  find 
what  the  contract  of  the  parties  was.  and 
instructed  the  jury  substantially  that,  if  they 
found  it  to  be  as  alleged  by  the  plaintiff", 
there  was  an  implied  warranty  that  the  ma- 
chine was  suitable  for  the  work  it  was  in- 
tended to  do;  and,  if  not  suitable  therefor, 
defendant  had  the  right  to  return  it  to  plain- 
tiff within  reasonable  time  after  discover- 
ing its  defects.  But  the  court  further  in- 
structed the  jury,  if  they  found  that  defend- 
ant, after  "he  knew  or  ought  to  have  known 
from  the  test  he  made  that  this  machine 
was  an  unsatisfactory  machine  on  Thursday- 
or  Friday,  and,  after  determining  that  he 
was  not  satisfied  with  it,  nevertheless  went 
on  and  worked  with  it  on  Satiu-day,  for  the 
purpose  of  completing  his  harvest,  the  law 
would  consider  that  an  acceptance  of  the 
machine."  Also  that  such  acceptance  would 
foreclose  defendant's  right  to  return  it.  and 
render  him  liable  to  pay  therefor  the  agreed 
price.  The  coiu't  furtlier  instructed  the  jury 
that,  if  they  found  defendant's  version  of  th- 
contract  the  correct  one.  he  had  the  right 
to  return  the  machine  if  not  satistied  with  it. 
unless  he  had  theretofore  accepted  it  under 
the  rule  of  acceptance  above  stated;  and. 
if  he  did  thus  accept  it,  the  right  to  return 
it  was  lost.  The  jury  found  for  plaintiff", 
and  asses.sed  his  damages  at  .$110  (that  be- 
ing the  admitted  conti-act  price  of  the  ma- 
chine) and  interest  thereon  from  the  com- 
mencement of  the  action.  A  motion  by  de- 
fendant for  a  new  trial  was  denied,  and 
judgment  entered  for  plaintift"  pursuant  to 
the  verdict.  Defend.mt  appeals  from  the 
judgment. 

T.    L.    Cl(>nry.    for    appellant.      Carter     & 
Burns,  for  respondent. 


WHEN  TITLE  PASSES. 


191 


LYUN,  C.  J.,  (after  statinji  tho  facts.) 
T.  There  is  no  claim  in  this  case  for  dani- 
a;res  for  a  breach  of  warranty,  either  ex- 
press or  implied,  on  the  sale  of  the  reaper 
and  liarvcster  in  controversy.  The  (jnesui-n 
of  warranty  is,  therefore,  of  no  siguittcance 
in  the  case,  except  as  it  bears  upon  the 
right  of  defendant  to  rettu'n  the  machine  in 
case  the  sale  thereof  was  absolute,  as  claim- 
ed by  plaintiff.  If  the  jin-y  found  the  con- 
tract to  be  as  claimed  by  defendailt,  un<ler 
the  charge  of  the  court  the  question  of  war- 
ranty does  not  necessarily  arise,  for  the  jury 
were  instructed  that,  if  they  so  found,  the 
defendant  had  the  right  to  return  the  ma- 
chine if  not  satisfied  with  it,  although  it 
may  have  done  such  work  as  would  sati.-fy 
men  generally.  The  right,  under  such  a  con- 
tract, to  return  the  property,  may  be  stated 
a  little  too  broadly  in  the  instructions;  but 
no  exception  was  taken  thereto,  and  it  stands 
as  the  law  of  this  case.  Certainly  the  rule 
thus  stated  allowed  the  defendant  to  be  dis- 
satisfied with  and  to  return  the  machine, 
even  though  there  was  no  breach  of  any 
warranty  in  respect  thereto,  either  express 
or  implied.  Neither  is  there  any  controvert- 
ed question  of  reasonable  time  in  which  to 
retiu'u  the  machine  involved  in  the  case.  If 
the  defendant  did  not,  by  his  use  of  the 
machine,  destroy  the  right  to  return  it.  it 
otherwise  he  had  such  right,  it  must  be 
held  as  matter  of  law  that  he  returned  it, 
or  rather  that  he  effectually  offered  to  re- 
turn it,  (which  amounts  to  the  same  thing.) 
within  a  reasonable  time  after  it  cai>i'>  to 
his  possession.  So  the  question  is  not  wheth- 
er the  offer  to  return  was  made  within  •)  n-a- 
sonable  time,  but  whether  the  defeiulaut 
had  any  right  to  return  the  machine  wlien 
he  attempted  to  do  so.  If  the  sale  was  ab- 
solute, as  claimed  by  plaintiff,  and  there 
was  a  breach  of  an  express  or  implied  war- 
ranty of  the  machine,  and  if  defendant  ac- 
cepted the  machine  after  testing  it.  and  dis- 
covering its  defects;  or  if  the  sale  was  upon 
condition  that,  if  dissatisfied  with  the  ma- 
chine, the  defendant  miglft  return  it.  and  if 
defendant,  after  testing  it,  fully  determined 
that  it  was  unsatisfactory  to  him.  and  he 
would  retm'u  it.  and  afterwards  accepted  it. 
—in  either  case  the  right  to  return  it  was 
lost.  The  court  instrticted  the  jury  that,  if 
defendant  ascertained  on  Thursday  or  Fri- 
day that  the  machine  did  not  do  good  work, 
in  the  one  case;  or.  in  the  other  case,  that 
he  then  determined  he  would  i-eturn  it  a>? 
unsatisfactory. — if  he  used  it  on  Saturday, 
not  to  test  it  fm-ther.  but  merely  to  com- 
plete the  cutting  of  his  grain,  and  without 
any  expectation  that  plaintiff  or  bis  agent 
would  come  there  and  make  the  machine 
satisfactory  to  him.  such  use  was  an  ac- 
ceptance of  the  machine  as  a  compliance 
with  the  contract,  and  was  fatal  to  his  right 
to  retiu'n  it.  We  think  the  court  stated  the 
laAV  correctly,  and  that  the  testimony  jus- 
tified the  submission  to  the  jury  of  the  ques- 


tion of  accei»tMnce.  It  slioidd  I)e  stated  that 
when  phiintiff  took  the  machine  to  defendant 
he  had  with  him  an  expert,  who  assisted 
in  starting  it.  There  is  testimony  to  the 
effect  that,  wltliout  plaintiff's  knowledge, 
such  expert  told  defendant's  son  he  would 
return  on  Friday,  and  see  how  the  machine 
worked;  but  he  made  no  promise  to  go 
there  on  Saturday.  Plaintiff  informed  de- 
fendant that  he  would  remain  at  Cu])a  City 
(his  home  being  in  (ialena)  until  Saturday, 
where  he  could  be  notified  if  the  machine 
did  not  work  right.  He  remained  there  un- 
til Saturday  afternoon,  but  received  no  such 
notice.  It  is  very  doul)tful  whether  the  ex- 
pert had  authority  to  bind  plaintiff  by  his 
promise  to  retin-n  on  Friday,  the  plaintiff 
being  present,  acting  for  himself,  although 
not  in  hearing  at  the  time.  But,  waiving 
that  question,  the  jury  miglit  well  find  from 
the  testimony  that  defendant  had  no  right 
to  expect,  and  did  not  exjiect,  that  either 
plaintiff  or  the  expert  would  retiu'n  to  de- 
fendant's farm  on  Friday,  or  at  any  other 
time,  or  that  either  of  them  intended  or 
promised  to  have  anything  further  to  do 
with  the  machine,  unless  notified  that  it 
did  not  work  well. 

II.  It  results  from  what  is  said  above  that 
the  first  and  second  instructions  proposed 
by  defendant  are  defective,  in  that  they 
ignore  the  question  of  acceptance.  They 
should  have  been  qtialified  by  adding  to  each 
a  clause  to  the  effect  that,  if  defendant  ac- 
cepted the  machine  in  the  manner  above 
stated.— that  is,  by  -u-sing  it  to  finish  his 
harvest  after  he  had  tested  it.  and  foimd  that 
it  would  not  do  good  work,  or  he  determined 
that  it  was  iinsatis factory  and  he  would  re- 
turn it,— his  right  to  return  it  was  lost;  and 
the  question  whether  he  did  so  return  or 
offer  to  return  it,  or  notify  plaintiff  of  his 
dissatisfaction  therewith,  within  a  rea.sou- 
able  time,  wotild  be  thereby  eliminated  from 
the  case.  The  third  proposed  instruction 
goes  expressly  upon  tie  hypothesis  that  the 
defendant  obtain  a  verdict.  The  verdict  be- 
ing for  plaintiff,  the  instruction  becomes  in- 
applicable to  the  case. 

III.  On  the  trial  the  question  was  rais(>d 
whether  plaintiff  owned  the  cause  of  acti(m 
for  the  price  of  the  machine.  It  was  i)roved 
that  he  was  the  agent  of  the  manufacturers 
for  the  sale  thereof,  and  otlnu-  like  macliines. 
under  a  contract  prescribing  the  terms  on 
which  alone  sales  shotild  be  made  by  him. 
and  providing  that,  if  sales  were  made  on 
other  terms,  plaintiff  should  be  charged  with 
the  machines  thus  sold  as  a  purchaser.  Tlie 
sale  of  the  machine  in  question  was  not 
made  in  accordance  with  such  prescribed 
terms  and  before  this  action  was  conimenceil 
it  was  charged  to  the  plaintiff"  as  a  purchas- 
er, and  he  paid  the   manufacturer   therefor. 

!   Of  coiu-se,  he  thus  became  the  owner  of  the 
cause  of  action  for  the  price  of  the  machine. 

IV.  Among  the  several  errors  assigned,  one 
is  as  follows:      "The  court  erred  in  conveying 


102 


WIIIOX   TITLE   PASSES. 


to  tlio  said  jury  his  o]»ini(ms  on  tlic  merits  of 
the  caso  by  the  inaniicf  in  whifh  Iw  roiu- 
luouted  on  tho  case  aud  furiuulated  his  m- 
structions  to  the  jury."  Tlic  li'i'niod  couiuu'l 
for  defendant  stated  in  liis  arj,ninieut  that 
this  Is  the  main  error  on  whieh  he  relies  Tor 
a  reversal  of  the  jndiiinent,  and  he  exi)lain- 
ed  in  a  very  ixiterestuij;  manner  how  an  hon- 
est jud.ue  may  be  uneonsciously  betrayed 
into  actions  and  exi)ressions  in  tlie  presence 
of  the  jury  very  prejudicial  to  the  cause  of 
one  or  the  other  of  the  parties.  And  si>, 
while  paying  a  high  and  well-deserved  trib- 
ute to  the  integrity,  ability,  and  desire  to  do 
exact  justice  in  all  cases  of  the  judge  who 
lircsided  at  the  trial,  he  argued  that  this  Is 
S  case   of  unconscious   bias  on   the  part  of 


the  judge  against  the  case  of  the  defendant, 
and  souglit  to  prove  its  existence  from  the 
record.  It  is  almost,  if  not  entirely,  inevit:^- 
ble  that  he  should  fail.  This  com-t  can  on'y 
know  from  tlje  r(H'ord  what  the  judge  said 
and  did  on  the  trial.  It  is  sufficient  to  say 
that  the  most  searching  scrutiny  of  the  rec- 
ord not  only  fails  to  disclose  the  existence  of 
any  such  bias,  but  it  fails  to  raise  even  a 
suspicion  of  its  existence.  We  find  neither 
error  nor  impropriety  in  any  of  the  remarks 
of  the  judge  on  the  trial,  which  are  referred 
to  by  counsel  in  support  of  bis  position. 
Neither  do  we  find  any  error  in  the  rulings 
of  the  court  on  the  trial,  or  in  the  charge 
to  the  jury.  The  judgment  of  the  circuit 
court  must  be  aflirmed. 


WHEN   TITLE    PASSES. 


193 


PRATT  V.  PECK  ot  al. 
(3()  X.  W.  410,  70  Wis.  020.) 
Siiprotnc  Cou'-t  of  Wisconsin.     Jan.  31,   1888. 
Appeal  from  circiiit  c-ourt,  Outagamie  coun- 
ty. 

Geori^re  W.  Piatt  sued  Oscar  D.  Peck  and 
others  upon  a  contract  for  the  manufacture 
und  sale  of  lumber.  Plaintiff  obtained  judg- 
lueut,  and  defendants  appeal. 

Weisbrod,  Ilarsliaw  &  Nevitt  and  S.  U. 
Pinnej-,  for  appellants.  Gabe  Bouck,  for  re- 
ispondent. 

OliTON,  J.  The  plaintiff  was  a  manufac- 
turer of  lumber  in  the  city  of  Oshkosh,  and 
Ihe  defendants  were  manufacturers  of  sash, 
doors,  and  blinds,  on  the  opposite  side  of  the 
street.  About  the  ninth  day  of  August,  1S83, 
the  defendants  bought  of  the  plaintiff  000,000 
feet  of  plank,  pai'tly  seasoned  and  then  piled 
up  in  the  plaintiff's  mill-yard,  and  400,000 
feet  of  the  same  kind  of  lumber,  to  be  sawed 
ivud  to  be  piled  up  in  the  plaintiff's  yard,  in 
the  same  manner,  but  in  another  piace  nearer 
the  defendant's  factory.  The  terms  of  the 
bargain  were  that  the  defendants  should  pay 
for  said  lumber  at  the  rate  of  $14  per  thou- 
sand for  shop  common,  $24  per  thousand  tor 
third  clear,  and  $34  per  thousand  for  first 
and  second  clear.  For  the  600,00(^)  feet  tneu 
piled  up,  the  defendants  were  to  pay  the 
plaintiff'  in  10  days,  and  for  the  400.000  feet, 
to  be  sawed  and  so  piled  up,  in  90  days,  and 
if  the  plaintiff"  should  wish  to  use  the  defend- 
ants' paper  for  the  400,000  feet,  before  it  was 
due,  that  he  should  have  it,  and  the  interest 
thereon  should  be  charged  back  up  to  the 
time  it  was  due.  The  IKMJ.OOO  feet  was  to  be 
hauled  at  once  to  the  defendants'  yaru  by 
the  plaintiff,  and  the  400,0(X)  feer  was  to  be 
piled  up  loosely,  so  that  it  could  di-y,  and  was 
not  to  be  hauled  by  the  plaintiff'  until  the 
next  spring.  Both  parties  agree  that  this 
was  the  contract.  The  plaintiff  commenced 
hauling  the  dry  lumber  at  once,  and  contin- 
ued to  haul  until  October  14th  following, 
when  the  defendants'  factory  was  burned, 
and  had  hauled  334,000  feet,  and  aiterwards, 
by  the  direction  of  the  defendants,  143,000 
feet  was  hauled  to  Gould's  mill,  in  Oshkosh, 
and  the  balance  was  l)urned  up  in  the  plain- 
tiff's yard.  The  defendants  paid  the  plain- 
tiff, by  September  1st,  $10,<hio,  and  after- 
wards the  balance  was  paid  for  the  dry  lum- 
ber. The  4(X).0O0  feet  was  sawed  and  piled 
up  in  the  place  so  designated  in  the  plain- 
tiff's yard,  and  near  the  defendants'  ottice, 
and  marked  with  the  defendants'  initials,  by 
October  1st,  and  notice  thereof  was  given  to 
the  defendants.  At  the  time  of  the  pur- 
chase, the  piles  of  dry  lumber  were  estimated 
and  marked,  and  afterwards  exactly  meas- 
ured when  hauled.  On  the  fifteenth  day  of 
November,  the  plaintiff's  mill  was  burned, 
and  the  largest  part  of  the  400.000  feet.  The 
plaintiff'  testified,  and  the  .iury  were  author- 
i/xd   to  find,   that  the   defendants   were  fre- 

VAN  ZILE  SEL.CAS.SALE.5 — 13 


quently  on  the  piles  of  the  green  lumber 
while  it  was  being  sawed,  and  knew  the 
kinds  and  qiuility  of  the  lumber,  and  that 
after  the  greater  part  of  the  green  lumber 
was  so  burned,  the  defendants  tried  to  have 
the  plaintiff'  let  them  off  from  the  jiurchase 
of  it,  and  on  his  refusal  to  do  so,  they  au- 
thorized him  to  sell  the  remnant  for  them  at 
the  best  late  he  could  get,  and  he  did  so  sell 
it,  and  credited  the  defendants  with  wliat  he 
received  therefor. 

This  action  is  brought  to  recover  the  Ital- 
ance  due  for  the  40(),(K)0  feet.  The  defense 
is,  that  which  is  not  uncommon  in  such  cases 
where  the  property  has  been  burne<l,  that  at 
the  time  of  the  burning,  the  4o<i.(i(»()  feet,  or 
any  part  of  it.  had  not  been  delivered  to  the 
defendants,  or  accepted  by  th<;m.  The  case 
has  been  twice  tried,  and  judgment  rendered 
for  the  plaintiff.  The  evidence  on  botli  trials 
was  substantially  the  s;ime.  From  tne  first 
judgment  an  appeal  was  taken  to  this  court 
and  the  judgment  reversed,  on  tne  soie 
ground  that  the  jury  failed  to  find,  upon  the 
only  material  issue,  whether  the  400,0(J0  feet 
had  been  delivered  or  accepted  before  the 
fire.  65  Wis.  40*3,  27  N.  W.  180.  On  tlie 
last  trial,  the  jury  found,  in  answer  to  the 
ninth  question,  that  '"there  was  a  delivery  of 
this  400,000  feet  of  lumber  tendered  by  the 
plaintiff  to  the  defendants  about  October  1, 
1883;"  and  to  the  tenth  question,  that  "the 
defendants  accepted  the  delivery  of  that  lum- 
ber;" and  to  the  eleventh  question,  that  'it 
was  the  intention  of  both  parties,  and  the 
agreement  between  them,  that  the  title  to 
this  400.(M)0  feet  of  green  lumber  shall  pass 
to  the  defendants  upon  the  lumber  being 
piled  and  marked  by  the  plaintiff',  and  notice 
thereof  given  to  the  defendants."  These 
liudiugs  fully  supply  the  defects  of  the  for- 
mer verdict,  and  answer  the  re(piirements  of 
the  former  decision.  The  two  trials  of  this 
case,  and  the  arguments  upon  the  law  upon 
both  appeals,  have  been  most  ably  conducted 
by  the  veiy  ablest  lawyers  on  both  sides,  and 
the  case  is  both  important  and  interesting. 
But  we  cannot  but  think  that  the  grounds  of 
the  controversy  have  been  somewhat  magni- 
fied, and  the  questions  are  very  technical. 
The  law  is  so  well  settled  in  this  class  of 
cases  as  to  be  almost,  if  not  quite,  elemen- 
tary. In  such  a  case  there  is  no  need  of 
stumbling  upon  the  technical  terms  "deliv- 
ery and  acceptance."  No  question  is  made 
of  the  kinds,  quality,  or  amoimt  of  the  lum- 
ber so  piled  up  in  the  plaintiff's  yard,  and 
there  could  not  well  be  any  question  of  that 
kind,  for  the  plaintiff"  proved  that  the  lum- 
ber, in  all  respects,  was  according  to  the  con- 
tract. It  is  im])ortant  to  know  wiiat  the  con- 
tract was.  and  how  the  parties  evidently  un- 
derstood it  to  be.  It  cannot  be  that  this 
lumber  was  to  remain  the  property  of  the 
plaintiff  until  it  was  hauled  to  the  dereud- 
ants'  factory,  for  the  whole  consideration 
was  to  be  paid  within  110  days  from  the  time 
the  lumber  should  be  sawed  and  piled  up  in 


194 


WHEN  TITLE  TASSES. 


tho  ])l;ieo  (l('si.miate(l.  and  Iho  liaulius'  was 
not  to  be  done  milil  the  uoxt  spi-ini;-.  In  the 
mean  time  tlie  himber  was  dryiu.:;-  in  the 
plaintiff's  yard,  for  the  sole  benelit  of  the 
defendants.  If  \he  l)0-days  credit  was  to 
conjmence  from  the  pilinj;-  of  tlie  lumber  on 
the  place  wlierc  the  defendants  wished  it  to 
be  piled,  then  it  follows  that  then  was  the 
time  tho  defendants  were  to  own  tho  hunbor. 
It  is  a  close  question  whether  the  00  days  did 
not  commence  at  the  time  of  the  purchase, 
the  same  as  the  10  days  for  the  dry  lumber. 
But  siving  the  defendants  the  benelit  of  hav- 
iuj?  the  00  days  commence  at  the  time  the 
.ureen  lumber  is  piled  up  according  to  the 
contract,  it  certainly  could  not  be  later  than 
that.  This  is  a  contract  as  well  as  a  sale. 
The  plaintiff  performed  it  to  the  fullest  ex- 
tent possible  on  his  part  when  he  piled  the 
lumber  in  the  place  designated,  and  marlced 
it.  and  notified  the  defendants  thereof.  But 
it  is  said  that  the  himber  had  not  been  in- 
spected to  ascertain  the  quality  anrt  quantity. 
Whose  fault  was  it  that  it  was  not  inspected? 
The  plaintiff  could  not  compel  the  defend- 
ants to  inspect  it,  or  to  come  and  expressly 
accept  it.  Could  they  delay  or  refuse  to  in- 
spect it,  and  thereby  postpone  the  payment, 
or.  by  sucli  delay  or  refusal,  postpone  or  de- 
stroy the  obligation  to  pay  for  it?  Most  cer- 
tainly not.  The  lumber  was  to  remain  in 
the  yard  of  the  plaintiff,  piled  loosely  so  as  to 
dry,  and  remain  there  from  October  1st  until 
the  next  spring,  for  the  mere  accommoda- 
tion of  the  defendants.  It  was  drying  for 
their  benefit.  Suppose  there  had  been  no 
burning,  and  after  the  defendants  were  noti- 
fied that  the  lumber  was  ready  for  them, 
piled  and  marked,  and  the  defendants  liad 
delayed  to  expressly  accept  it,  or  to  pay  any 
attention  to  it,  at  the  expiration  of  tne  00 
days  after  that,  is  there  any  doubt  that  the 
plaintiff  could  have  sued  the  defendants  for 
the  money  and  have  recovered?  So  he  may 
recover  now.  The  burning  could  make  no 
difference  in  the  liability,  if  it  did  in  the  dis- 
position, of  the  defendants  to  pay  for  it  ac- 
cording to  the  contract.  The  defendants 
placed  this  practical  construction  upon  the 
contract  (which  is  entire)  when  tney  esti- 
mated the  dry  lumber  in  the  pile,  and  paid 
for  it  accordingly.  Then,  as  a  matter  of 
mere  contract,  without  reference  to  the  tech- 
nical questions  of  delivery  and  acceptance, 
the  plaintiff  had  fully  performed  his  part  of 
the  contract,  and  was  therefore  entitled  to 
the  consideration  agreed  to  be  paid  by  the 
defendants.  In  such  a  very  clear  case  we 
shall  not  place  much  stress  upon  the  mere 
teclmical  question  whether  the  lumber  was 
actually  delivered  by  the  plaintiff,  or  accept- 
ed by  the  defendants,  as  in  other  cases  not 
applicable.  On  the  merits  of  the  case,  we 
are  not  asked  to  disturb  the  verdict,  but  Ter- 
rain errors  of  the  trial  court  are  alleged, 
vvliicli.  the  learned  counsel  of  the  appellants 


claim,  affected  the  merits  of  the  case  or  mis- 
directed the  jury. 

We  have  carefully  examined  the  excep- 
tions, and  we  cannot  find  that  any  of  them 
were  material  to  the  merits  and  real  justice 
of  the  case,  except,  perhaps,  that  one  re- 
lating to  the  charge  of  the  court,  as  to  the- 
effect  of  the  notice  to  the  defendants  that 
the  lumber  Avas  ready  for  them,  piled  and 
marked,  and  the  legal  elfect  of  the  defend- 
ants' delay  in  expressly  accepting  or  reject- 
ing the  same,  for  an  unreasonable  time. 
That  instruction  was  as  follows:  "If  the- 
lumber  was  piled,  and  notice  thei-eof  given  to 
the  defendants,  and  the  defendants  did  not. 
within  a  reasonable  time  after  notice,  notify 
the  plaintiff  of  their  refusal  to  accept  a  de- 
livery, an  acceptance  or  delivery  may  be 
presumed  or  inferred  by  the  jury,  rrom  the 
failure  of  the  defendants  to  give  notice  of 
their  refusal,  and  ought  to  be  so  inferreti, 
and  in  that  case  your  answer  to  questlo^i  No. 
10  should  be  'Yes.'  "  This  "silence  and  de- 
lay" may  be  found  in  some  other  parts  of 
the  charge  excepted  to.  To  show  that  this 
instruction  is  erroneous,  the  learned  counsel 
of  the  appellants  cite  the  language  of  Mr. 
Benjamin,  in  his  work  on  Sales,  as  follows: 
"Tho  fair  deduction  from  the  authorities 
seems  to  be  that  this  is  a  question  of  degree; 
tliat  a  long  and  unreasoualjle  delay  would 
afford  stringent  proof  of  acceptance,  while 
a  shorter  delay  would  merely  constitute  some 
evidence  to  be  taken  into  consideration  with 
the  other  circumstances  of  the  case."  It 
would  seem  that  this  authority  sanctioned 
the  instruction.  "Unreasonable  delay,"  and 
refusal  to  accept  "within  a  reasonable  time." 
would  seem  to  be  substantially  alike.  Be- 
yond a  reasonable  time  is  tinreasonable  de- 
lay. If  the  delay  is  not  reasonable,  it  is  un- 
reasonable. The  delay  is  "stringent  proof  of 
acceptance."  This  text  is  sustained  by  the 
cases  cited  by  cotnisel.  In  application  to  the 
facts  of  this  case,  we  think  the  instruction 
was  strictly  correct.  Tliis  instruction  is  di- 
rectly approved  by  the  decision  in  the  case 
of  Mason  v.  Whitbeck  Co.,  35  Wis.  1G7,  and 
many  other  cases  in  this  and  other  courts. 
The  learned  counsel  of  the  respondents  cites 
many  cases  to  the  same  effect,  to  which  ref- 
erence may  be  had.  But  this  case  is  too 
plain  to  burden  this  opinion  by  the  citation 
of  many  authorities,  and  it  has  already  oc- 
cupied much  space  in  the  reports.  The  fires 
which  burned  the  defendants'  factory  and 
the  plaintitf's  mill  and  mucli  of  this  lumber 
were  most  unfortunate,  and  the  case  is  a 
hard  one  for  the  defendants;  but  it  must  be 
a  hard  one  to  one  of  the  parties  in  any 
event;  but  this  should  not  press  the  courts 
into  the  establishment  of  unsoiuid  legal  prin- 
ciples. 

We  find  no  error  in  tlie  record  which  ought 
to  reverse  the  judgment.  The  judgment  of 
the  circuit  court  is  affirmed. 


WIIKX  TITLE   PASSES. 


ly: 


DYER  ct  ill.  V.  GREAT  .XOKTIIERX  RY.  CO. 

(o-i  X.   W.  714,  r,l  Minn.  lU^.) 
Supreme  Court  of  Minnesota.      Xov.   21,   1802. 

Appeal  from  niunicipal  court  of  St.  Paul; 
Twohj%  Judjit'. 

Action  by  W.  J.  Dyer  and  otliers,  copart- 
ners as  W.  .T.  Dyer  &  Bros.,  against  the 
(ireat  Northern  Railway  Company,  to  recover 
the  value  of  a  piano  shipped  by  them  over 
defendant's  road.  The  cause  was  submitted 
for  decision  to  the  court  upon  a  stipulation 
of  facts,  which  are  set  out  in  the  opinion. 
Judgment  was  ordered  fo'-  plaintiffs.  From 
:in  order  denying  a  new  trial,  defendant  ap- 
peals.    Reversed. 

M.  D.  Grover  and  R.  .\.  Williinson.  for  ap- 
pellant. M.  C.  Laughliu  and  .Mr.  Morrison, 
for  respondents. 

CULLIXS.  .J.  I'laintifts  were  the  consign- 
ors, one  Colwell  the  consignee,  and  defend- 
ant the  common  carrier,  of  a  piano  shipped 
from  Minneapolis  to  Anoka  over  its  line  of 
railway.  When  the  instrument  was  deliver- 
ed to  defendant  for  carriage  its  agent  gave 
the  usual  bill  of  lading  to  plaintiffs,  and  this 
was  immediately  transmitted  by  them  to  Col- 
well, the  consignee.  Soon  after  its  arrival 
at  Anoka,  and  before  Colwell  had  the  oppor- 
tunity to  remove  it  from  the  depot,  the  piano 
was  destroyed  by  fire.  Thereupon  Colwell 
made  a  claim  upon  defendant  for  its  value, 
producing  the  bill  of  lading  and  an  invoice, 
from  which  it  appeared  that  he  had  purchas- 
ed the  piano  from  plaintiffs,  and  had  partly 
paid  for  the  same.  The  fact  was  that  the 
.sale  to  Colwell  was  rouditional,  a  written 
contract  having  been  made  that  the  title  to 
the  instrument  should  remain  in  plaiiitiffs 
until  Colwell  paid  for  it  in  full,  and  a  copy 
of  this  contract  had  been  duly  filed  in  the  of- 
fice of  the  proper  city  clerk  a  few  days  be- 
fore the  fire,  in  compliance  with  the  provi- 
sions of  the  statute.  Gen.  St.  1S7.S.  c.  30.  §| 
lu,  etc.    Defendant  had  no  actual  knowledge 


of  this,  and  had  not  been  advised  in  any 
n.anner  as  to  plaintiffs'  claim  upon  the 
piano,  when,  in  settlement  of  Col  well's  de- 
nuuid,  it  paid  to  him  its  full  value.  It  is 
thoroughly  setth-d  that  if  no  other  facts  ap- 
pear the  consignee,  and  not  the  consignor,  of 
property  delivered  to  a  common  carrier  miist 
hi  considered  its  owner.  Benjamin  v.  Levy, 
30  .Minn.  11,  :5.S  X.  \V.  702.  The  legal  pre- 
sumption is  that,  upon  the  delivery  of  goods 
to  a  common  carrier,  the  title  thereto  ve.-its 
in  the  consignee,  and  this  presumption  the 
carrier  has  a  riglit  to  rely  upon,  in  the  al»- 
sence  of  express  notice  from  the  consignor 
to  the  contrary.  The  carrier,  therefore,  has 
Die  right  to  settle  with  the  consignee  in  case 
the  property  is  lost,  stolen,  or  destroyed. 
Sfannnon  v.  Wells,  Eargo  &  Co.,  H4  Cal.  311, 
24  Pac.  284;  Pennsylvania  Co.  v.  Holderman. 
(■)'.»  Ind.  IS;  2  Am.  &  Eng.  Enc.  Law,  pp.  810, 
Nil,  and  cases  cited  in  notes.  Again,  upon 
Die  stipulated  facts,  Colwell  had  a  special 
property  in  the  instrument,  and  as  a  special 
owner  could  recover  its  full  value  from  the 
defendant.  Cliamberlain  v.  West,  37  Minn. 
rA,  33  X.  W.  114.  See,  also,  .lellett  v.  Rail- 
way Co..  .30  .Minn.  2<m.  IT,  X.  W.  237;  Brown 
V.  Shaw,  .11  Minn.  2r,r,,  .j3  N.  W.  ^33;  .Mars- 
den  V.  Cornell.  <;2  X.  Y.  21."5;  Boston  &  M.  R. 
Co.  V.  Warrior  Mower  Co.,  7t;  Me.  200;  White 
V.  Webb.  1.5  Conn.  :M)~}.  Counsel  for  resp'ond- 
ents  do  not  take  issue  upon  these  proposi- 
tions, but  insist  that,  on  the  filing  of  a  copy 
of  the  conditional  contract  of  sale,  as  before 
stated,  defendant  carrier  had  notice  that 
their  clients  retained  title  to  the  propi-rty. 
and  was  bound  by  such  notice.  The  sfatutt- 
(sections  l'>,  etc.,  supra),  have  no  application. 
They  were  enacted  for  the  benefit  and  pro- 
tection of  the  parties  therein  mentioned. 
namel,v.  creditors  of  the  vendee,  subsequent 
purchasers,  and  mortgagees  in  good  faith, 
and  the  well-established  rules  of  law  fixing 
defendant's  liability  as  a  common  carri'T 
were  in  m  manner  affected  bj-  the  provisions 
therein  contained. 
Order  reversed. 


196 


WHEN  TITLE   PASSES. 


-XATIOXAL    BANK    OF    COMMERCE    OF 

BOSTON  V.  MERCHANTS'  NAT. 

BANK  OF  MEMPHIS. 

(91  U.  S.  92.) 

Supreme  Court  of  the  United  States.    Oct.,  1875. 

Error  to  the  circuit  court  of    the   United 
States  for  the  district  of  Massachusetts. 

H.  W.  Paiue  and  H.  C.  Hutchins,  fur  plaiii- 
lilT  iu  error.     W.  G.  Russell,  contra. 

Mr.   .Tusllce    STRONG    delivered    the   opin- 
ion of  the  court. 

The  fundamental  question  in  this  case  is, 
whether  a  bill  of  lading  of  merchandise  de- 
liverable to  order,  when  attached  t(j  a  time 
draft  and  forwarded  Avith  the  draft  to  an 
agent  for  collection,  without  any  special  in- 
structions, may  be  surrendered  to  the  draw- 
ee on  his  acceptance  of  the  draft,  or  whether 
the  agent's  duty  is  to  hold  the  bill  of  lad- 
ing after  the  acceptance  for  the  payment. 
It  is  true,  there  are  other  questions  growing 
out  of  portions  of  the  evidence,  as  well  as 
one  of  the  findings  of  the  jury;  but  they  are 
questions  of  secondary  importance.  The 
l)ills  of  exchange  were  drawn  by  cotton-bro- 
kers residing  in  Memphis.  Tenn..  on  Green 
&  Travis,  merchants,  residing  in  Boston. 
They  were  drawn  on  account  of  cotton  ship- 
ped by  the  brokers  to  Boston,  invoices  of 
which  were  sent  to  Green  &  Travis;  and  bills 
of  lading  were  taken  by  the  shippers,  marls 
ed  in  case  of  two  of  the  shipments  "To  or- 
der," and  in  case  of  the  third  shipment  mark- 
ed "For  Green  6c  Travis,  Boston,  Mass." 
There  was  an  agreement  between  the  ship- 
pers and  the  drawees  that  the  bill  of  lading 
should  be  surrendered  on  acceptance  of  the 
bills  of  exchange;  but  the  existence  of  this 
agreement  was  not  known  by  the  Bank  of 
Memphis  when  that  bank  discounted  the 
drafts,  and  took  with  them  the  bills  of  lad- 
ing indorsed  by  the  shippers.  We  do  not 
propose  to  inquire  now  whether  the  agree- 
ment, under  these  circumstances,  ought  to 
have  any  effect  upon  the  decision  of  the  case. 
Conceding  that  bills  of  lading  are  negotiable, 
and  that  their  indorsement  and  delivery  pass 
the  title  of  the  shippers  to  the  property 
specified  in  them,  and  therefore  that  the 
plaintiffs,  when  they  discounted  the  drafts 
and  took  the  indorsed  railroad  receipts  or 
bills  of  lading,  became  the  owners  of  the 
cotton,  it  is  still  true  that  they  .sent  the  bills 
with  the  drafts  to  their  correspondents  in 
New  York,  the  Metropolitan  Bank,  with  no 
instructions  to  hold  them  after  acceptance; 
and  the  Metropolitan  Bank  transmitted  them 
to  the  defendants  in  Boston,  with  no  other 
instruction  than  that  the  bills  were  sent  "for 
collection."  What,  then,  was  the  duty  of 
the  defendants?  Obviously,  it  was  first  to 
obtain  the  acceptance  of  the  bills  of  ex- 
ciiange.  But  (Jreen  &  Travis  Avere  not 
bound  to  accept,  even  though  they  had  or- 
dered the  cotton,  unless  the  bills  of  lad- 
ing were  delivered  to  them  contemporaneous- 


ly witli  their  acceptance.  Their  agreement 
with  their  vendors,  the  shippers,  secured 
them  against  such  an  obligation.  Moreovei*. 
independent  of  this  agreement,  the  drafts 
upon  their  face  showed  that  they  had-  been 
drawn  upon  the  cotton  covered  by  the  bills 
of  lading.  Both  the  plaintiffs,  and  their 
agents  the  defendants,  were  thus  informed 
that  the  bills  were  not  drawn  upon  any 
fund.s  of  the  drawers  in  the  hands  of  (Jreen 
&  Travis,  and  that  they  were  expected  to 
be  paid  out  of  the  proceeds  of  the  cotton. 
But  how  could  they  be  paid  out  of  the  pro- 
ceeds of  the  cotton  if  the  bills  of  lading 
were  withheld?  Withholding  them,  there- 
fore, would  defeat  alike  the  expectation  and 
the  intent  of  the  drawers  of  the  bills.  Hence, 
were  there  nothing  more,  it  Avould  seem  that 
a  drawer's  agent  to  collect  a  time  bill,  with- 
out further  instructions,  would  not  be  justi- 
fied in  refttsing  to  surrender  the  property 
against  which  the  bill  was  drawn,  after  its 
acceptance,  and  thus  disable  the  acceptor 
from  making  payment  otit  of  the  property 
designated  for  that  purpose. 

But  it  seems  to  be  a  natural  inference,  in- 
deed a  necessary  implication,  from  a  time 
draft  accompanied  by  a  bill  of  lading  in- 
dorsed in  blank,  that  the  merchandise  (which 
iu  this  case  was  cotton)  specified  in  the  bill 
was  sold  on  credit,  to  be  paid  for  by  the 
accepted  draft,  or  that  the  draft  is  a  de- 
mand for  an  advance  on  the  shipment,  or 
that  the  transaction  is  a  consignment  to  be 
sold  by  the  drawee  on  account  of  the  ship- 
per. It  is  difficult  to  conceive  of  any  other 
meaning  the  instruments  can  have.  If  so, 
in  the  absence  of  any  express  arrangement 
to  the  contrary,  the  acceptor,  if  a  purchaser, 
is  clearly  entitled  to  the  possession  of  the 
goods  on  his  accepting  the  bill,  and  thus 
giving  the  A-endor  a  completed  contract  for 
payment.  This  would  not  be  doubted,  if, 
instead  of  an  acceptance,  he  had  given  a 
promissory  note  for  the  goods,  payable  at  the 
expiration  of  the  stipulated  credit.  In  such 
a  case,  it  is  clear  that  the  vendor  could  not 
retain  possession  of  the  subject  of  the  sale 
after  receiving  the  note  for  the  price.  The 
idea  of  a  sale  on  credit  is  that  the  vendee 
is  to  have  the  thing  sold  on  his  assumption 
to  pay,  and  before  actual  payment.  The 
consideration  of  the  sale  is  the  note.  But  an 
acceptor  of  a  bill  of  exchange  stands  in  the 
same  position  as  the  maker  of  a  promissory 
note.  If  he  has  purchased  on  credit,  and 
is  denied  possession  until  he  shall  make  pay- 
ment, the  transaction  ceases  to  be  what  it 
was  intended,  and  is  converted  into  a  cash 
sale.  Everybody  understands  that  a  sale 
on  credit  entitles  the  purchaser  to  immediate 
possession  of  the  property  sold,  unless  there 
be  a  special  agreement  that  it  may  be  re- 
tained by  the  vendor;  and  such  is  the  well- 
recognized  doctrine  of  the  law.  The  reason 
for  this  is,  that  very  often,  and  with  mer- 
chants generally,  the  thing  purchased  is 
needed   to   provide   means   for   the   deferred 


WHEN  TITLE    PASSES. 


197 


payment  of  rlic  price.  Hence  it  i.s  justlj'  in- 
ferred that  the  tliinj^  is  intended  to  pass  at 
once  within  ihe  control  of  the  purchaser.  It 
is  admitted  that  a  different  arraug:ement  may 
be  stipulated  for.  Even  in  a  credit  sale,  it  may 
be  ajjreed  by  the  parties  that  the  vendor  shall 
I'etain  the  subject  until  the  expiration  of  the 
credit,  as  a  security  for  the  payment  of  the 
sum  stipulated.  But.  if  so.  the  agreement  is 
special,  something  superadded  to  an  ordi- 
nary contract  of  sale  on  credit,  the  existence 
of  which  is  not  to  be  presumed.  Therefore, 
in  a  case  where  the  drawing  of  a  time  draft 
against  a  consignment  raises  the  implica- 
tion that  the  goods  consigned  have  been 
sold  on  credit,  the  agent  to  whom  the  draft 
to  be  accepted  and  the  bill  of  lading  to  be 
delivered  have  been  intrusted  cannot  rea- 
sonably be  required  to  know,  without  in- 
struction, that  the  trau.saction  is  not  what 
it  purports  to  be.  He  has  no  right  to  as- 
sume and  act  on  the  assumption  that  the 
vendee's  term  of  credit  must  expire  before 
be  can  have  the  goods,  and  that  he  is  bound 
to  accept  the  draft,  thus  making  himself  ab- 
solutely responsible  for  the  sum  named 
tlierein.  and  relying  upon  the  vendor's  en- 
gagement to  deliver  at  a  future  time.  This 
would  be  treating  a  sale  on  credit  as  a 
mere  executory  contract  to  sell  at  a  subse- 
(luent  date. 

If  the  inference  to  be  drawn  from  a  time 
draft  accompanied  by  a  bill  of  lading  is,  not 
that  it  evidences  a  credit  sale,  but  a  request 
for  advances  on  the  credit  of  the  consign- 
ment, the  consequence  is  the  same.  Perhaps 
it  is  even  more  apparent.  It  -plainly  is.  that 
the  acceptance  is  not  asked  on  the  credit  of 
the  drawer  of  the  draft,  but  on  the  faith  of 
the  consignment.  The  drawee  is  not  a.sked 
to  accept  on  the  mere  assurance  that  the 
drawer  will,  at  a  future  day,  deliver  the 
goods  to  reimburse  the  advances:  he  is  ask- 
ed to  accept  in  reliance  on  a  security  in  hand. 
To  refuse  to  him  that  security  is  to  deny  him 
tlie  basis  of  his  requested  acceptance:  it  is 
remitting  him  to  the  personal  credit  of  the 
drawer  alone.  An  agent  for  collection  hav- 
ing the  draft  and  attached  bill  of  lading  can- 
not he  permitted,  by  declining  to  surrender 
the  bill  of  lading  on  the  acceptance  of  the 
bill,  to  disappoint  the  obvious  intentions  of 
the  parties,  and  deny  to  the  acceptor  a  sub- 
stantial right  which  by  his  contract  is  as- 
sured to  him.  The  same  remarks  are  ap- 
l)lieable  to  the  case  of  an  implication  that 
the  merchandise  was  shipped  to  be  sold  on 
account  of  the  shipper. 

Nor  can  it  make  any  difference  that  the 
draft  with  the  bill  of  lading  has  been  sent 
to  an  agent  (as  in  this  case)  "for  collection." 
That  instruction  means  simply  to  rebut  the 
inference  from  the  indorsement  tliat  tlie 
agent  is  the  owner  of  the  draft.  It  indicates 
an  agency.  Sweeny  v.  Easter.  1  Wall.  IW. 
It  does  not  conflict  with  tlie  plain  inference 
from  the  draft  and  accompanying  bill  of  lad- 
ing   that    the   former    was    a    request   for    a 


promise  to  ]iay  at  a  future  time  for  guods 
sold  on  credit,  or  a  request  to  make  ad- 
vances on  the  faith  of  the  described  consign- 
ment, or  a  request  to  sell  on  account  of  the 
shipper.  By  such  a  transmission  to  tli.^ 
agent,  he  is  instructed  to  collect  the  money 
mentioned  in  the  drafts,  not  to  collect  the 
bill  of  lading;  and  the  tirst  step  in  the  col- 
lection is  procuring  acceptance  of  the  draft. 
The  agent  is,  therefore,  authorized  to  do  all 
which  is  necessary  to  obtaining  such  ac- 
ceptance. If  the  drawee  is  not  bound  to  :ic- 
cept  without  the  surrender  to  him  of  the 
consigned  property  or  of  the  bill  of  lading, 
it  is  tlie  duty  of  the  agent  to  make  that  sur- 
render; and  if  he  fails  to  perform  this  duty, 
and  in  consequence  thereof  acceptance  be  re- 
fused, the  drawer  and  indorsers  of  the  draft 
are  discharged.  Mason  v.  Hunt,  1  Doug. 
297. 

The  opinions  we  have  suggested  are  su])- 
ported  by  other  very  rational  considerations. 
In  the  ab.sence  of  special  agreement,  what 
is  the  considei'ation  for  acceptance  of  a 
time  draft  drawn  against  merchandise  con 
signed?  Is  it  the  merchandise'.'  Or  is  it 
the  promise  of  the  consignor  to  deliver?  If 
the  latter,  the  consignor  may  be  wholly  ir- 
responsible. If  the  bill  of  lading  be  to  his 
order,  he  may,  after  acceptance  of  the  draft, 
indorse  it  to  a  stranger,  and  thus  wholly 
withdraw  the  goods  from  any  possibility  of 
their  ever  coming  to  the  hands  of  the  ac- 
ceptor. Is.  then,  the  acceptance  a  mere  pur- 
chase of  the  promise  of  thie  drawer?  If  so. 
why  are  the  goods  forwarded  before  the^ 
time  designated  for  payment?  They  are  a.s 
much,  after  shipment,  under  the  control  of 
the  drawer,  as  they  were  before.  Why 
incur  the  expense  of  storage  ajid  of  insur- 
ance? And  if  the  draft  with  the  goods  or 
with  the  bill  of  lading  be  sent  to  a  bank  for 
collection,  as  in  the  case  before  us.  can  it 
be  incumbent  upon  the  bank  to  take  and 
maintain  custody  of  the  property  sent  dur- 
ing The  interval  between  the  acceptance  and 
the  time  fixed  for  payment?  (The  shipments 
in  this  case  wei'e  hundreds  of  bales  of  cot- 
ton.) Meanwhile,  though  it  be  a  twelve- 
month, and  no  matter  what  the  fluctuations 
in  the  market  value  of  the  goods  may  be. 
are  the  goods  to  be  withheld  from  sale  or 
use?  Is  the  drawee  to  run  the  risk  of  fall- 
ing prices,  with  no  ability  to  sell  till  the 
draft  is  due?  If  the  consignment  be  of 
lierishable  articles.— such  as  peaches,  fish. 
l)Utter.  eggs.  &c.,— are  they  to  remain  in  a 
warehouse  until  the  term  of  credit  shall  ex- 
pire? And  who  is  to  pay  the  warehouse 
charges?  Certainly  not  the  drawees.  If 
they  are  to  be  paid  by  the  vendor,  or  one 
who  has  succeeded  to  the  place  of  the  ven- 
dor by  indorsement  of  the  draft  and  bill  of 
lading,  he  fails  to  obtain  the  price  for  wliich 
the  goods   were  sold. 

That  the  holder  of  a  bill  of  lading,  who 
has  become  such  by  indorsement  and  by  dis- 
counting the  draft   drawn  against  the  con- 


J98 


WHEN  TITLE  PASSES. 


siyued  property,  suceoeds  to  the  situatiou  of 
the  shipper,  is  not  to  be  doubted.  He  has 
tlip  same  rij;ht  to  demand  acceptauce  of  the 
aceompanylng  bill,  and  no  more.  If  the 
shipper  cannot  require  acceptance  of  the 
draft  without  surrendering  the  bill  of  ladinj.;. 
neither  can  the  holder.  Bills  of  ladlns". 
though  transferable  by  iudorseiyent,  are 
only  quasi  negotiable.  1  Pars.  Sliipp.  1!)2; 
i'.lanchard  v.  Page,  8  Gray,  297a.  The  in- 
(lorser  does  not  acquire  a  right  to  change  the 
agreement  between  the  shipper  and  his  ven- 
dee. He  cannot  impose  obligations  or  deny 
advantages  to  the  drawee  of  the  bill  of  ex- 
ciiange  drawn  against  the  shipment  which 
were  not  in  the  power  of  the  drawer  and 
consignor.  But,  were  this  not  so  in  the  ease 
we  have  now  in  hand,  the  ageiits  for  col- 
lection of  the  drafts  were  not  informed,  ei- 
ther by  the  drafts  themselves  or  by  any  in- 
struetious  they  received,  or  in  any  other  way, 
tliat  the  ownership  of  the  drafts  and  bills  of 
lading  was  not  still  in  the  consignors  of  the 
cotton.  On  the  contrary,  as  the  drafts  were 
sent  "for  collection,"  they  might  well  con- 
clude that  the  collection  was  to  be  made  for 
tlie  drawers  of  the  bills.  We  do  not,  therefore, 
perceive  any  force  in  the  argument  pressed 
upon  us,  that  the  Bank  of  Memphis  was  the 
purchaser  of  the  drafts  drawn  upon  Green 
tVL'  Travis,  and  the  holder  of  the  bills  of  lad- 
ing by  indorsement  of  the  shippers. 

It  is  urged  that  the  bills  of  lading  were  con- 
tracts collateral  to  the  bills  of  exchange  which 
the  bank  discounted,  and  that,  wdien  transfer- 
red, they  became  a  security  for  the  principal 
obligation;  namely,  the  contract  evidenced  by 
the  bills  of  exchange,— for  the  whole  contract, 
and  not  a  part  of  it;  and  that  the  whole  con- 
tract required  not  only  the  acceptance,  but  the 
payment  of*  the  bills.  The  argument  assumes 
tlie  very  thing  to  be  proved;  to  wit,  that  the 
transfer  of  the  bills  of  lading  were  made  to  se- 
cure the  payment  of  the  drafts.  The  opposite 
of  this,  as  we  have  seen,  is  to  be  inferred  from 
the  bills  of  lading  and  the  time  drafts  drawn 
against  the  consignments,  unexplained  by  ex- 
press stipulations.  The  bank,  when  discount- 
ing the  drafts,  was  bound  to  know  that  the 
drawers  on  their  acceptance  were  entitled  to 
the  cotton,  and,  of  course,  to  the  evidences  of 
title  to  it.  If  so,  they  knew  that  the  bills  of 
lading  could  not  be  a  security  for  the  ultimate 
payment  of  the  drafts.  Payment  of  the  drafts 
by  the  drawees  was  no  part  of  the  contract 
when  the  discounts  were  made.  The  bills  of 
exchange  were  then  incomplete.  They  needed 
acceptaiace.  They  were  discounted  in  the  ex- 
pectation that  they  would  be  accepted,  and  that 
thus  the  bank  would  obtain  additional  prom- 
isors. The  whole  purpo.se  of  the  transfers  of 
the  bills  of  lading  to  the  bank  may,  therefore, 
well  have  been  satisfied  when  the  additional 
names  were  secured  by  acceptance,  and  when 
the  drafts  thereby  became  completed  bills  of 
exchange.  We  have  already  seen,  that  whether 
the  drafts  and  accompanying  bills  of  lading 
( videnced  sales  on  credit,  or  requests  for  ad- 


vancements on  the  cotton  consigned,  oi'  l^ail- 
nients  to  be  sold  on  the  consignor's  account,  the 
drawees  were  entitled  to  the  possession  of  the 
cotton  before  they  could  be  required  to  ac- 
cept; and  that,  if  they  had  declined  to  accept 
because  possession  was  denied  to  them  concur- 
rently with  their  acceptance,  the  effect  would 
have  been  to  disclv.rge  the  drawers  and  in- 
dorsers  of  the  dr.:'f'ts.  The  demand  of  accept- 
ance, coupled  with  a  claim  to  retain  the  l)ills 
of  lading,  would  have  been  an  insufficient  de- 
m.'ind.  Surelj'  the  purpose  of  piitting  the  bills 
of  lading  into  the  hands  of  the  bank  was  to 
secure  the  completion  of  the  drafts  by  obtain- 
ing additional  names  upon  them,  and  not  to 
discharge  the  drawers  and  indorsers,  leaving  the 
bank  onl.y  a  resoit  to  the  cotton  pledged. 

It  is  said,  that,  if  the  plaintiffs  were  not  en- 
titled to  retain  the  bins  of  lading  as  a  security 
for  the  payment  of  the  drafts  after  their  ac- 
ceptauce, their  only  security  for  payment  was 
the  undertaking  of  the  draw^ees,  who  were 
without  means,  and  the  promise  of  the  accept- 
ors, of  whose  standing  and  credit  they  knew 
nothing.  This  may  be  true;  though  they  did 
know  that  the  acceptors  had  previously  prompt- 
ly met  their  acceptances,  which  were  numerous, 
and  large  in  amoimt.  But.  if  they  did  not 
choose  to  rely  solely  on  the  responsiljility  of  the 
acceptors  and  drawers,  they  had  it  in  their  pow- 
er to  instruct  their  agents  not  to  deliver  the 
cotton  until  the  drafts  were  paid.  Such  in- 
structions are  not  infrequently  given  in  case  of 
time  drafts  against  consignments;  and  the  fact 
that  they  are  given  tends  to  show  that  in  the 
commercial  community  it  is  understood,  that, 
without  them,  agents  for  collection  would  be 
obliged  to  give  over  the  bills  of  lading  on  ac- 
ceptance of  the  draft.  Such  instructions  would 
be  wholly  unnecessary,  if  it  is  the  duty  of  such 
agents  to  hold  the  bills  of  lading  as  securities 
for  the  ultimate  payment. 

Thus  far,  we  have  considered  the  question 
\\'ithout  reference  to  any  other  authority  than 
that  of  reason.  In  addition  to  this,  we  thinlv 
the  decisions  of  the  courts  and  the  language  of 
many  eminent  judges  accord  with  the  opinions 
we  avow.  In  the  case  of  Lanfear  v.  Blossom, 
1  La.  Ann.  14S,  the  veiy  point  was  decided, 
after  an  elaborate  argument  both  by  the  coun- 
sel and  by  the  cou-M:.  It  was  held  that  "where 
a  bill  of  exchange  drawn  on  a  shipment,  and 
payable  a  certain  number  of  days  after  sight, 
is  sold,  with  the  bill  of  lading  appended  to  it, 
the  holder  of  the  bill  of  exchange  cannot,  in 
the  absence  of  proof  of  any  local  usage  to  the 
contrary,  or  of  the  imminent  insolvency  of  the 
diawee,  require  the  latter  to  accept  the  bill  of 
exchange,  except  on  the  delivery  of  the  bill 
of  lading;  and  when,  in  consequence  of  the" 
refusal  of  the  holder  to  deliver  the  bill  of  lad- 
ing, acceptance  is  refused,  and  the  bill  protest- 
ed, the  protest  will  be  considered  as  made  with- 
out cause,  the  drawee  not  having  been  in  de- 
fault, and  the  drawer  will  be  discharged."  This 
decision  is  not  to  be  distinguished  in  its  essen- 
tial features  from  the  opinions  we  have  ex- 
pressed.    A  judgment  in  the  same  case  to  the 


WHEN  TITLE  PASSES. 


199 


same  effect  was  jjiveii  in  the  coinuierclal  court 
of  New  Orleans  by  Judge  ^^'atts,  who  support- 
ed it  by  a  veiy  couvinciuj;  opinion.  14  Hunt. 
Mer.  Mag.  2li4.  The.se  decisions  were  made  in 
l-'4.j  and  lS4(j.  In  other  couits.  also,  the  ques- 
tion has  arisen.  What  is  the  duty  of  a  collecting 
banlv  to  which  time  drafts,  with  bills  of  Luling 
attached,  have  been  sent  for  collection?  and 
the  decisions  have  been,  that  the  agent  is 
boimd  to  deliver  the  bills  of  lading  to  the  ac- 
ceptor on  his  acceptance.  In  the  case  Wiscon- 
sin Marine  &  Fire  las.  Co.  v.  Banii  of  British 
North  America  (decided  in  lSi]li  21  U.  C.  Q. 
B.  284.  Avhere  it  app'eared  that  the  plaintiff,  a 
bank  at  Milwaukee,  Wis.,  had  sent  to  the  de- 
fendants, a  bank  at  Toronto,  for  collection,  a 
bill  drawn  by  .\.  at  ^Milwaukee  on  B.  at  Toronto, 
payable  fortj--five  days  after  date,  together  Avith 
a  bill  of  lading,  indoiscd  by  A.,  for  certain 
wheat  sent  from  Milwaukee  to  Toronto,  it  was 
held,  that,  in  the  absence  of  any  instructions 
to  tiie  coutraiy.  vhe  defendants  were  not  bound 
to  retain  the  bill  of  lading  imtil  payment  of  the 
draft  by  B.,  but  wers^  right  in  giving  it  up  to 
him  on  obtaining  his  acceptance.  This  case 
was  reviewed  in  1S(")3  in  the  court  of  eii'ov  and 
appeals,  and  the  judgment  affirmed.  2  U.  C. 
Err.  &  App.  282.  See,  also.  Gooodenough  v. 
Bank,  10  U.  C.  C.  V.  .jl:  Clark  v.  Bank,  13 
(irani,  Ch.  211. 

There  are  also  many  expre.ssions  of  opinion 
by  the  most  respectable  com'ts.  which,  though 
not  judgments,  and  therefore  not  authorities, 
are  of  weight  in  determining  what  are  the  im- 
plications of  such  a  state  of  facts  as  this  case 
exhibits.  In  Shepherd  v.  Harrison,  L.  R.  4  Q. 
B.,  493,  Lord  Cockburn  said:  "The  authori- 
ties are  equally  good  to  show,  when  the  con- 
signor sends  the  bill  of  lading  to  an  agent  in 
this  country  to  be  by  Wm  handed  over  to  the 
consignee,  and  accompanies  that  with  bills  of 
exchange  to  be  accepted  by  the  consignee,"  that 
that  "indicates  an  mtention  that  the  handing 
over  of  the  bill  of  lading,  and  the  acceptance 
of  the  bill  or  bills  of  exchange,  should  be  con- 
current parts  of  one  and  the  same  transaction." 
The  case  subsi  ciuently  went  to  the  house  of 
lords  (.5  H.  L.  133)  when  Lord  Cairns  said: 
*Tf  they  (the  drawees)  accept  the  cargo  and  biU 
of  lading,  and  accept  the  bill  of  exchange  diawn 
against  the  cargo,  the  object  of  those  who  ship- 
ped the  goods  is  obtained.  They  have  got  the 
bill  of  exchange  in  return  for  the  cargo;  they 
discount,  or  use  it  as  they  think  proper;  and 
they  are  virtually  paid  for  the  goods."  In 
Coventry  v.  Gladstone,  4  L.  It.  Eq.  493,  it  was 
declared  by  the  vice-chancellor  that  "the  par- 
ties shipping  the  goods  from  Calcutta,  in  the 
absence  of  any  stipulation  to  the  contraiy,  did 
give  their  agents  in  England  full  authority,  if 
they  thought  fit,  to  pass  over  the  bill  of  lading 
to  the  person  who  had  accepted  the  bill  of  ex- 
cliange"  drawn  against  the  goods,  and  attached 
to  the  bill  of  lading;  and  it  was  ruled  that  an 
aUeged  custom  of  trade  to  retain  the  bill  of 
lading  until  payment  of  the  accompanying  draft 
on  account  of  the  consignment  was  exceptional, 
and-  was    not   established   as   being   tlie    usual 


course  of  business.  In  Schuchardt  v.  Hall,  39 
Md.  590  Avhich  A\as  a  case  of  a  time  draft,  ac- 
companied by  a  bill  of  lading,  hj-pothecated  by 
the  drawer,  both  for  the  acceptance  and  ijay- 
ment  of  the  draft,  and  when  the  di-awers  luid 
been  authorized  to  draw  against  the  cargo  ship- 
ped, it  Avas  said  by  the  court:  "Under  their 
contract  with  the  defendants,  the  latter  Avere 
authorized  to  (haw  only  again.st  the  cargo  of 
wheat  to  be  shipped  by  the  Ocean  Belle;  and 
they  (the  drawees)  were,  therefore,  not  bound 
to  accept  without  the  delivery  to  them  of  the 
bill  of  lading."  See  also  the  language  of  the 
judges  in  (iurney  v.  Behrend.  3  El.  &  Bl.  022; 
Bank  v.  Wright,  48  N.  Y.  1;  Bank  v.  Daniels, 
47  N.  Y.  G31. 

We  have  been  imable  to  discover  a  single  de- 
cision of  any  court  holding  the  opposite  doc- 
trines. Those  to  which  we  have  been  referred 
as  directly  in  point  detennine  nothing  of  the 
kind.  Gilbert  v  Guignon,  L.  R.  8  Ch.  16,  was 
a  contest  between  tAvo  holders  of  several  bills 
of  lading  of  the  same  shipment.  The  qutstlGn 
AA-as,  which  had  priority?  It  AA'as  not  all  wheth- 
er the  draAA-ee  of  i  time  draft  against  a  con- 
signment has  not  a  right  to  the  bill  of  lading 
Avhen  he  accepts.  The  drawer  had  accepted 
without  requiring  the  sm'render  of  the  first  in- 
dorsed bill  of  lading;  and  the  lord  chancellor, 
while  suggesting  a  query  Avhether  he  might  not 
have  declined  to  accept  unless  the  bills  of  lad- 
ing Avere  at  the  same  time  deliA^ered  up  to  him, 
remarked.  "If  he  Avas  content  they  should  re- 
main in  the  hands  of  the  holder,  it  was  ex- 
actly the  .same  thing  as  if  he  had  previously 
and  originally  authorized  that  course  of  pro- 
ceeding; and  that  (according  to  the  chancellor's 
view)  was  actually  Avhat  had  happened  in  the 
case."  Nothing,  therefore.  Avas  decided  respect- 
ing the  rights  of  the  holder  of  a  time  thaft,  to 
A\'hich  a  bill  of  lading  is  attached,  as  against 
the  drawee.  The  contest  was  wholly  inter 
alios. 

Seymour  v.  NeAAton,  lO.j  Mass.  272,  AAas  the 
case  of  an  acceptance  of  the  draft,  without  the 
presentation  of  the  bill  of  lading.  In  that  re- 
spect, it  was  like  Gilbert  v.  Guignon.  No  ques- 
tion, however,  was  maole  in  regard  to  this.  The 
acceptor  became  insolvent  before  the  arrival  of 
the  goods;  and  all  that  AA-as  decided  was,  that, 
under  the  circumstances,  the  jury  would  be 
authorized  to  find  rliat  the  lien  of  the  shippers 
had  not  been  discharged.  It  was  a  case  of 
stoppage  in  transitu.  It  is  tiiie,  that,  in  deliv- 
ering the  opinion  of  the  court,  Chief  Justice 
Chapman  said:  "The  obvious  purpose  AA-as. 
that  there  should  be  no  deliveiy  to  the  vemlee 
till  the  draft  should  be  paid."  But  the  remark 
was  purely  obiter,  uncalled  for  by  any  thing  in 
the  case.  NeAAComb  v.  Boston  &  L.  R.  Coip.. 
11.5  Mass.  230,  was  also  the  case  of  acceptance 
of  sight  drafts,  w-ithout  requiring  the  deliverj- 
of  the  attached  bills  of  lading:  and  the  contest 
A\-as  not  betAA-een  the  holder  of  the  drafts  and 
the  acceptor;  it  Avas  IjetAveen  the  holder  of  the 
drafts  Avith  the  bills  of  lading  and  the  carrier. 
We  do  not  perceive  that  the  case  has  any  ap- 
plicability to  the  qutstion  we  haA-e  now  under 


10(3 


\Vlli:X  TITLE   PASSES. 


consideration.  True,  there,  as  in  the  case  of 
Seymour  v.  Newton,  it  was  remarlced  by  the 
jufljj:e  who  delivered  the  opinion,  "Tlie  raih'oad 
receJiits  were  manifestly  intended  to  be  held  by 
the  collecting  bank  as  security  for  the  accept- 
ance and  payment  of  the  drafts."  Intended  l)y 
whom?  Evidently  the  court  meant  by  the 
drawees  and  the  bank;  for  it  is  immediatdj 
added,  "Tliey  continued  to  be  held  by  the  bank 
after  the  drafts  had  been  accepted  by  Chandler 
&  Co.  (the  drawees),  and  imtil  at  Chandler  & 
Co.'s  request  they  were  paid  by  the  plaintiff; 
and  the  receipts  with  the  drafts  still  attached 
were  indorsed  and  delivered  bj'  Chandler  & 
Co.  to  the  plaintiff."  In  Stollenwerck  v.  Thach- 
er,  115  Mass.  224  (the  only  other  case  cited  by 
the  defendants  in  eiror  as  in  point  on  this  ques- 
tion), there  were  instructions  to  the  agent  to  de- 
liver the  bill  of  lading  only  on  payment  of  the 
draft;  and  it  was  held  that  the  special  agent, 
thus  instructed,  could  not  bind  his  principal  by 
a  delivery  of  the  bill  without  such  payment. 
Nothing  was  decided  that  is  pertinent  to  the 
present  case.  In  Bank  v.  Bayley,  Id.  228,  where 
the  instructions  given  to  the  collecting  agent 
were,  so  far  as  it  appears,  only  that  the  drafts 
and  bills  of  lading  were  remitted  for  collection, 
and  where  acceptance  was  refused.  Chief  Jus- 
tice Gray  said:  "The  drawees  of  the  draft  at- 
tached to  each  of  the  bills  of  lading  were  not 
entitled  to  the  bill  of  lading,  or  the  propei'ty 
described  therein,  except  upon  acceptance  of  the 
draft."  It  is  but  just  to  say,  however,  that 
this  remark,  as  well  as  those  made  by  the  same 
judge  in  the  other  Massachusetts  cases  cited, 
was  aside  from  the  decision  of  the  court. 

After  this  review  of  the  authorities  cited, 
as  in  point,  in  the  very  elaborate  argimient 
for  the  defendants  in  error,  we  feel  justified  in 
saying,  that,  in  our  opinion,  no  respectable  case 
can  be  found  in  which  it  has  been  decided  that 
when  a  time  draft  has  been  dra^vn  against  a 
consigiunent  to  order,  and  has  been  forwarded 
to  an  agent  for  collection  with  the  bill  of  lading 
attached,  without  any  further  instructions,  the 
agent  is  not  justified  in  delivering  over  the  bill 
of  lading  on  the  acceptance  of  the  draft. 

If  this,  however,  were  doubtful,  the  doubt 
ought  to  be  resolved  favorably  to  the  agent. 
In  the  case  in  hand,  the  Bank  of  Commerce, 


having  accepted  the  agency  to  collect,  was 
bound  only  to  reasonable  care  and  diligence  in 
the  discharge  of  its  a.ssumed  duties.  Warren 
V.  Bank,  10  Cush.  oS2.  In  a  case  of  doubt,  its 
best  judgment  was  all  che  principal  had  a  right 
to  require.  If  the  absence  of  specific  instruc- 
tions left  it  uncertain  what  was  to  be  done 
further  than  to  procure  acceptances  of  the 
drafts,  and  to  receiv^e  payment  when  they  fell 
due,  it  was  the  fault  of  the  principal.  If  the 
consequence  was  a  los«,  it  would  be  most  un- 
just to  cast  the  loss  on  the  agent. 

Applying  what  we  have  said  to  the  instruc- 
tion given  by  the  learned  judge  of  the  circuit 
court  to  the  juiy,  it  is  evident  that  he  was  in 
error.  Without  discussing  in  detail  the  several 
assignments  of  error,  it  is  sufReient  for  the  ne- 
cessities of  this  case  to  say  that  it  was  a  mis- 
take to  charge  the  jury,  as  they  were  charged, 
that  "in  the  abs'^nce  of  any  consent  of  the 
owner  of  a  liill  of  exchange,  other  than  such  as 
may  be  implied  from  the  mere  fact  of  sending^ 
'for  collection'  a  bill  of  exchange  with  a  bill 
of  lading  pasted  or  attached  to  a  bill  of  ex- 
change, the  bank  so  receiving  the  two  papers 
for  collection  would  not  be  authorized  to  sep- 
arate the  bill  of  lading  from  the  bill  of  ex- 
change, and  surrender  it  before  the  bill  of  ex- 
change was  paid."  And  again:  there  was  er- 
ror in  the  following  portion  of  the  charge: 
"But  if  the  r*Ietropolitan  Bank  merely  sent  to 
the  defendant  liaiik  the  bills  of  exchange  with 
the  bills  of  lading  attached  for  collection,  with 
no  other  instructions,  either  expressed  or  im- 
plied from  the  past  relations  of  the  parties, 
they  would  not  be  so  justified  in  surrendering 
(the  bills  of  lading)  on  acceptance  only."  The 
Bank  of  Commerce  can  be  held  liable  to  the 
owners  of  the  drafts  for  a  breach  of  dut^'  in 
surrendering  the  bills  of  lading  on  acceptance 
of  the  drafts,  only  after  special  instructions  to 
retain  the  bills  until  payment  of  the  acceptances. 
The  drafts  were  all  time  drafts.  One,  it  is 
time,  was  di-awn  at  sight;  but,  in  ^lassachu- 
setts,  such  drafts  are  entitled  to  grace. 

What  we  have  said  renders  it  unnecessary  to 
notice  the  other  assignments  of  error. 

The  judgment  of  the  circuit  court  is  reversed, 
and  "^lie  record  is  remitted  with  directions  to 
award  a  new  trial. 


WHEN  TITLE   PASSES. 


CO  I 


BAKER  T.  CHICAGO,  M.  &  ST.  P.  RY.  CO. 

(G7  N.  W.  37G.) 

Supreme  Court  of  Iowa.      May  22,  1S9G. 

Appeal  from  district  court,  Woodbury  coun- 
ty;   S.  M.  Ladd,  Judge. 

Action  for  the  value  of  goods  shipped  over 
defendant's  line  of  road.  Judgment  for  the 
plaintiff,  and  the  defendant  appealed.  Re- 
versed. 

Taylor,  Shull  &  Farnsworth,  for  appellant. 
Lynn  &  Foley,  for  appellee. 

GRANGER,  J.  1.  The  ease  on  appeal  pre- 
sents two  causes  of  action,  the  first  being  for 
dates,  ci-auberries,  and  cabbage  shipped  from 
Sioux  City  to  Ha  warden,  in  Iowa.  They  were 
consigned  to  L.  M.  Lake,  who  refused  to  re- 
ceive them,  and  the  company  sold  then  to 
third  parties  for  two  dollars.  The  petition 
charges  a  conversion  by  the  defendant.  The 
court  instructed  the  jury  that  the  plaintifC 
was  entitled  to  recover  the  fair  and  reason- 
able value  of  the  articles  less  the  charges  for 
transportation.  The  value,  as  alleged,  is 
$10.30.  The  jury  allowed  plaintiff  .$6.  There 
is.  in  argument,  as  there  should  be,  a  con- 
cession that  there  was  a  conversion  of  the 
goods.  The  court  left  it  to  the  jury  to  fix 
the  amount,  and  there  is  testimony  to  show 
that  the  articles  were  worth  from  $10  to  $12. 
There  is  no  reason  why  Ave  should  disturb  the 
finding  of  the  jury,  and  the  judgment  in  that 
particular  will  stand  affirmed. 

2.  The  other  cause  of  action  is  for  a  car 
load  of  apples  shipped  from  Boston,  Mass., 
to  Yankton,  S.  I).  The  apples  were  purchased 
for  plaintiff  by  one  Stickney  about  November 
21,  1S02,  and  shipped  by  the  National  Dis- 
patch &  Transfer  Company  to  Chicago,  and 
from  there  to  Yankton  by  the  defendant  com- 
pany's line  of  road,  reaching  there  about  De- 
cember 4,  1802.  After  the  shipment,  the 
plaintiff,  through  defendant's  agent  at  Sioux 
City,  attempted  to  have  the  destination  of  the 
car  changed  to  Sioux  City,  but  it  was  not 
done.  The  purchase  in  Boston  was  made 
from  York  &  Whitney,  and  the  shipment  was 
made  by  that  finn  to  itself  at  Yankton.  In 
making  the  purchase  Stickney  paid,  on  the 
car  load,  $100,  and  for  the  balance — .$324 — a 
draft  was  attached  to  the  bill  of  lading  by 
York  &  Whitney,  and  sent  to  the  bank  at 
Siou.x  City  for  collection.  The  plaintiff  re- 
sided at  Sioux  City,  and  at  Yankton  tliere 
was  no  one  to  receive  the  apples,  and  after 
some  time  they  were  stored,  and  afterwards, 
in  Febrtiary,  1893,  shipped  to  Sioux  City,  at 
the  request  of  plaintiff.  On  reaching  Sioux 
City  they  were  found  to  be  of  no  valtie,  and 
plaintiff  refused  to  accept  them.  The  court, 
in  charging  the  jury,  stated  the  claims  of  the 
jmrties  as  follows:  "The  plaintiff  claims  that 
through  his  agent.  Stickney,  he  purchased  a 
far  load  of  150  barrels  of  apples  in  Boston, 
and  paid  $100  thereon,  that  the  sellers,  York 
&  Whitney,  as  a  condition  of  said  sale,  told 


plaintiff  said  apples  were  plaintiff's,  and  to 
have  said  apples  shipped  as  plaintiff  might 
wish,  and  to  pay  therefor  when  said  apples 
reached  their  destination;  that  Stickney,  the 
agent  of  plaint ilf,  caused  said  apples  to  be 
shipped  in  the  name  of  I'ork  &  Whitney  to 
said  York  &  Whitney  at  Yankton.  S.  D.,  and 
that  said  apples  were  so  shipped  and  reached 
said  Yankton,  and  that  while  there,  by  rea- 
son of  the  negligence  of  defendant,  they  were 
wasted,  and  lost  by  decay.  The  defendant 
claims  that  the  car  of  apples  was  shipped  by 
York  &  Whitney  to  themselves  as  consignee 
and  that  the  apples  were  not  to  be  delivered 
until  the  balance  due  thereon  was  paid  for; 
and  at  the  time  of  the  injury,  if  any,  to  said 
apples  they  were  the  property  of  Y^ork  «fc 
Whitney,  and  not  of  plaintiff;  and  defendant 
further  claims  that  it  exercised  due  diligence 
in  the  care  of  said  apples."  The  court  pre- 
sented to  the  jury  two  questions:  First, 
whether  by  the  purchase  at  Boston  plaintiff 
became  the  owner  of  the  apples,  before  he  ob- 
tained the  bill  of  lading,  by  the  payment  of 
the  balance  of  the  purchase  price;  and.  sec- 
ond, if  he  did,  then  whether  the  defendant 
was  negligent  in  caring  for  the  apples  at 
Yankton.  In  expressing  the  law  as  to  what 
would  amount  to  a  transfer  of  title  at  Boston, 
so  that  the  plaintiff  would  be  the  owner,  the 
court  s.aid  to  the  jury,  in  substance,  that  if 
there  was  an  agreement  by  which  the  apples 
were  plaintiff's,  and  there  was  no  condition 
that  the  bill  of  lading  was  not  to  l)e  delivered 
until  tbe  balance  of  the  purchase  price  was 
paid,  they  became  the  property  of  plaintiff, 
so  that  he  could  recover.  It  then  stated  as 
follows:  "If,  however,  you  find  from  the 
evidence  that  the  plaintiff,  through  his 
agent,  Stickney,  purchased  the  apples  from 
York  &  Whitney  in  Boston,  and  paid  $100 
thereon,  and  that  nothing  was  said  concern- 
ing the  payment  of  the  balance,  or  that  it 
Avas  agreed  that  the  balance  should  be  paid 
upon  the  delivery  of  the  bill  of  Itiding  to 
plaintiff,  and  it  was  arranged  that  the  bill  of 
lading  should  be  made  out  to  York  &  Whit- 
ney, to  be  turned  over  to  plaintiff  upon  the 
payment  of  the  balance  due  on  the  apples, 
then  the  apples  would  not  become  the  prop- 
erty of  the  plaintiff  until  he  received  the  bill 
of  lading.  So,  too.  unless  you  find  that  York 
&  Whitney  at  the  time  of  the  purchase  told 
Stickney  that  the  apples  were  his,  and  he  had 
accepted  them,  and  that  he  could  ship  them 
as  he  pleased,  and  the  bill  of  lading  was  made 
out  to  York  &  Whitney  as  consignees  at  the 
instance  of  Stickney,  the  property  did  not 
pass  to  the  plaintiff  until  he  had  received  the 
bill  of  lading  at  Sioux  City;  and  if  you  flud 
under  this  instrtietion  that  the  property  did 
not  pass  to  plaintiff  until  he  received  the  bill 
of  lading  in  Sioux  City,  then  he  did  not  be- 
eome  the  owner  of  said  property  until  after 
the  injury,  if  any,  occurred,  and  he  could 
not  recover  the  damages,  if  any,  to  said  ap- 
ples." These  rules  of  law  are  not  ques- 
tioned, and  in  the  light  of  them  we  may  on- 


-202 


WHEN  TITLE   PASSES. 


sider  an  assignment  of  error  tliat  the  court 
erred  in  refusing  to  direot  a  verdict  for  the 
defendant  because  the  phiintiff  had  no  owner- 
ship of  the  property  in  controvorsy.  It  will 
he  seen  that  it  is  the  law  of  the  case  that, 
if  uotliing  was  said  concerning  the  payment 
of  the  balance,  or  that  it  was  agreed  that  the 
balance  should  be  paid  on  the  delivery  of  the 
bill  of  lading  to  plaintiff,  and  it  was  ar 
ranged  that  the  bill  of  lading  should  be  made 
out  to  York  &  Whitney,  to  be  turned  over  to 
]ilaintiff  upon  the  payment  for  the  balance  of 
the  apples,  then  they  would  not  become  the 
property  of  plaintiff  until  he  received  the  bill 
of  lading.  The  purchase  was  made  by  Stick- 
ney,  and  his  is  the  only  testimony  from  which 
it  can  be  known  what  the  understanding  at 
Boston  was.  There  had  been  other  transac- 
tions betv.-een  York  &  Whitney  and  plaintiff, 
but  they  do  not  aid  the  question.  Stickney, 
on  his  direct  examination,  makes  some  state- 
ments that,  disconnected  from  his  cross-ex- 
amination, might  leave  the  conclusion  in 
doubt  as  to  the  purpose  of  sending  the  draft 
for  collection  with  the  bill  of  lading.  It  will 
be  seen  that  the  law  as  stated  makes  the  ab- 
sence of  evidence  to  show  an  understanding 
that  plaintiff  was  to  have  the  apples  regardless 
of  the  bill  of  lading  fatal  to  plaintiff.  The 
fact  of  such  a  right  must  be  made  to  ap- 
pear to  overcome  the  legal  Inference  from 
sending  the  draft  for  collection  with  the  bill ' 
of  lading.  The  following  is  the  statement  of 
Stickney  on  cross-examination:  '"The  last 
time  I  was  in  Boston  I  bought  these  six  cars 
of  apples.  Did  not  pay  for  them  at  that  time 
in  full;  not  the  six  cars.  The  car  in  ques- 
tion was  one  of  the  six.  Tlie  bills  of  lading 
for  the  other  cars  were  all  forwarded  to  Mr. 
Baker,  I  expect.  I  had  possession  of  the  bill 
of  lading  there.  I  took  it  to  York  &  Whitney, 
and  gave  them  possession  of  it.  They  sent 
it,  with  the  draft,  to  the  bank  here,— the 
draft  for  the  balance  of  the  one  car  load  of 
apples.  Mr.  Baker  couldn't  get  them  until 
he  paid  that  draft.  I  don't  know  of  any  con- 
tract or  arrangement  between  York  &  Whit- 
ney and  myself  and  ^Ir.  Baker  by  which  Mr. 
Baker  could  come  into  possession  of  that  bill 


of  lading  without  paying  for  the  apples. 
There  was  nothing  said  about  that,  that  I 
know  of."  In  his  direct  examination  there  is 
nothing  actually  in  conflict  with  these  state- 
ments, when  carefully  considered.  He  had 
before  made  purchases,  and  paid  for  them, 
and  similar  shipments  had  been  made  except 
as  to  bills  of  lading  which  were  sent  directly 
to  plaintiff.  On  his  direct  examination  he 
says,  after  speaking  of  other  shipments: 
"When  I  bought  these  cars  I  suggested  to 
him  perhaps  he  had  better  ship  them  to  his 
own  order,  not  being  very  well  acquainted 
with  Mr.  Baker,  and  send  the  draft  with  the 
bill  of  lading."  The  witness  further  said  on 
his  direct  examination:  "I  asked  him  if  I 
paid  him  one  hundred  dollais  for  each  car  if 
it  would  be  all  right;  that  he  would  ship  the 
apples  right  through;  and  he  said  'Yes,'  it 
would  be  all  right;  it  didn't  make  any  dif- 
ference about  that.  I  suggested  to  him.  if 
it  wasn't  all  right,  whether  it  w;is  or  not,  he 
could  attach  the  draft  to  the  bill  of  lading. 
He  had  never  known  Mr.  Baker  except  what 
transactions  I  had  done  with  him  the  last 
four  or  five  Aveeks,  and  lie  said  that  would 
be  all  right;  and  I  gave  him  directions  where 
to  ship  each  car."  This  evidence  is  without 
practical  conflict.  There  are  genei-al  state- 
ments seemingly  so;  but  at  all  times  wh(  a 
the  thought  of  payment  is  the  controlling  one 
there  is  nothing  to  indicate  that  the  title  wrs 
to  pass  before  payment.  There  is  no  phar;e 
of  the  evidence  on  which  there  c-an  be  a  re- 
covery under  the  instructions,  and  hence  the 
court  should  have  directed  a  verdict  for  de- 
fendant on  this  branch  of  the  case.  This 
conclusion  renders  it  unnecessary  to  consider 
the  question  of  negligence  or  a  failure  to  stop 
the  car  at  Sioux  City.  As  to  the  latter,  how- 
ever, it  may  be  said  that  the  court  instructed 
the  jiu'y  that  there  was  no  evidence  to  show 
that  defendant  ought  to  have  so  stopped  the 
car. 

The  costs  as  to  the  branch  of  the  case  we 
affirm  are  but  nominal,  and  the  costs  of  the 
appeal  will  be  taxed  to  appellee,  and  the 
judgment  as  to  the  claim  for  apples  will 
stand  reversed. 


\VHEX  TITLE   PASSES. 


203 


FREEMAX   V.    KRAEMER   et   al. 

(G5  N.  W.  455.) 

Supreme  Court  of  Minnesota.      Dec.   19,  1895. 

Appeal    from    miiiiuipal    couit    of    Duln+h; 
Roger  S.  ro\vell.  Judjie. 

Action  by  C.  F.  Freeman.  d(jing  business  as 
C.  F.  Freeman  &  Co.,  against  P.  G.  Kraemer 
and  others,  for  conversion.  From  an  order 
denying  a  new  trial,  after  a  verdict  for  plain- 
tiff, defendants  appeal.     Affirmed. 

L.  U.  C.  Titus,  for  appellants.  Jaques  & 
Hudson,  for  respondent. 

CAXTY,  J.  On  Xovemlier  26,  1894.  plain- 
tiff shipped  a  car  load  of  oats  and  a  car  load 
of  hay  from  Rol.erts.  Wis.,  to  one  Stevenson, 
a  commission  merchant  at  Duluth.  Minn.  A 
bill  of  lading  or  shipping  receipt,  whichever  it 
may  be  called,  was  issued  by  the  railway  com- 
pany to  plaintiff  (as  C.  F.  Freeman  &  Co.)  for 
each  car.  One  of  these  bills  of  lading,  as  far 
as  here  material,  reads  as  follows:  "Chicago, 
St.  Paul.  ^Minneapolis  &  Omaha  Railway  Co. 
X'^o.  car.  12.444.  Roberts  Station.  Xov.  26, 
1894.  Received  of  C.  F.  Freeman  «fc  Co..  in 
apparent  good  condition,  marked,  Geo.  F.  Ste- 
venson. Duluth.  Minn.:  Articles,  baled  hay, 
weight  20.4(10.  as  described  above;  contents 
and  value  unknown;  to  be  transported  by  the 
Chicago.  St.  Paul.  ^linneapolis  &  Omaha  Rail- 
way Company  to  the  destination  named  above. 
*  *  *  J.  E.  Bethel.  Agent."  The  other  bill 
of  lading  is  in  the  same  form.  A  few  days 
prior  to  this.  Stevenson  wrote  plaintiff  offering 
$12  per  ton  for  one  car  of  hay.  and  31%  cents 
per  bushel  for  one  car  of  oats,  and  the  ship- 
ment to  him  was  in  response  to  his  offer.  Im- 
mediately on  shipping  the  two  care,  plaintiff 
drew  one  draft  for  the  price  of  the  hay,  and  at- 
tached it  to  the  bill  of  lading  for  the  car  of 
hay.  and  drew  another  draft  for  the  price  of 
the  oats,  and  attached  it  to  the  bill  of  lading 
for  the  car  of  oats.  These  drafts  were  drawn 
on  Stevenson  in  favor  of  plaintiff's  banker 
at  Roberts,  who  forwarded  them,  with  the  at- 
tached bills  of  lading,  to  another  banker  at 
Duluth.  for  collection,  but  the  drafts  were  not 
discounted.  These  drafts  arrived  in  Duluth 
and  were  presented  to  Stevenson  for  payment 
on  November  2^th,  but  he  refused  to  pay  them, 
giving  as  an  excuse  that  the  care  had  not  yet 
arrived.  The  cars  had  arrived  on  the  2Tth. 
and  on  the  2Sth  the  railway  company,  on  the 
order  of  Stevenson,  delivered  them  to  defend- 
ants, who  claim  that  they  bought  the  oats  and 
hay  from  Stevenson  in  good  faith,  and  paid 
him  in  full  for  the  same.  The  29th  of  X'oveni- 
ber  was  a  legal  holiday,  and  on  the  next  day 
the  Duluth  banker  attempted  to  find  Steven- 
son, and  again  demand  ]iayment  of  the  drafts 
from  him,  but  he  could  not  be  found.  There- 
upon the  drafts  and  bills  of  lading  were  re- 
turned to  plaintiff,  who  proceeded  to  Duluth, 
and  demanded  the  oats  and  hay  of  defendants, 
who  refused  to  deliver  the  same  to  him,  and 
Ihis  action  was  brought  for  damages  for  the 


conversion  of  the  same  by  defendants.  On 
the  trial  the  court  ordered  the  jury  to  i-eturn 
a  verdict  for  plaintiff  for  the  value  of  the  prop- 
erty, and  from  an  order  denying  their  motion 
for  a  new  trial  defendants  appeal. 

We  are  of  the  opinion  that  the  order  aiipealed 
fror^  should  be  affirmed.  It  clearly  and  con- 
clu  .  Ay  appears  from  the  evidence  that  the 
sale  or  contemplated  side  from  plaintiff'  to  Ste- 
venson was  to  Ix"  a  cash  transaction.  Xo  in- 
dicia of  ownership  was  given  to  Stevenson. 
On  the  contraiy.  the  bills  of  lading  were 
forwarded  by  plaintiff,  with  the  drafts  at- 
tachefl  to  them,  in  such  a  manner  as  to  make 
the  intended  delivery  of  the  bills  to  Steven- 
son concurrent  with  the  payment  of  the 
drafts  for  the  purchase  price  of  the  prop- 
erty. From  the  circumstances,  it  conclu- 
sively appears  that  plaintiff  did  not  intend 
to  vest  the  title  to  the  property  in  Steven- 
son until  the  goods  were  paid  for.  Of  course, 
where,  on  an  absolute  sale  of  goods,  credit  is 
given,  so  that  the  delivery  and  payment  of 
the  purchase  price  are  not  intended  to  be  con- 
current acts,  the  delivery  is  absolute,  and,  in 
the  absence  of  fraud  or  mistake,  there  is  no 
way  of  revesting  the  goods  in  the  vendor,  ex- 
cept by  the  exercise  of  the  right  of  stoppage  in 
transitti.  Where  it  is  a  conditional  sale  on 
credit,  the  title  not  to  pass  until  paid  for,  it  is 
void  as  against  sitbsequent  ptirchasers  in  good 
faith  for  value,  unless  the  proper  evidence  of 
the  transaction  is  filed  of  record,  ptirsuant  to 
sections  4148  and  4149.  Gen.  St.  1894.  But 
this  statute  has  uo  application  to  cash  sales. 
National  Bank  of  Commerce  v.  Chicago,  B.  «& 
N.  R.  Co.,  44  Minn.  231,  46  N..W.  342,  500. 
Where  the  sale  is  to  be  a  cash  transaction,  if 
the  vendee  gets  possession  before  the  purchase 
price  is  paid,  his  possession  will,  at  least  for  a 
short  period,  be  regarded  as  merelj'  condition- 
al, and  of  such  a  character  that  he  cannot  vest 
a  purchaser  from  him  with  title.  National 
Bank  of  Commerce  v.  Chicago,  B.  «&  N.  R.  Co., 
sttpra;  Benj.  Sales  (6th  Ed..  Am.  notes)  p. 
282.  See.  also.  Emeiy  v.  Bank.  25  Ohio  St. 
360;  Bank  v.  Kelly.  57  N.  Y.  34;  Bank  v. 
Daniels.  47  X.  Y.  631;  Bank  v.  Jones,  4  N.  Y. 
497,— which  are  cases  similai*  in  principle  to 
this. 

2.  Appellants  contend  that  plaintiff  had  con- 
ferred  indicia  of  ownership  on  Stevenson,  and 
that  this  gave  Stevenson  power  to  vest  title  by 
estoppel  in  appellants.  In  view  of  the  au- 
thorities just  cite<:l.  it  is  hardl.v  necessary  to 
say  that  merely  shipping  the  goods  addresseil 
to  the  consignee,  while  retaining  the  bills  of 
lading,  confers  no  indicia  of  ownership  on  the 
consignee. 

3.  It  is  also  contended  that  the  instrtimouts 
delivered  to  plaintiff  by  the  railway  company 
in  this  instance  were  not  bills  of  lading,  but 
what  counsel  terms  mere  "shipping  receipts." 
and  that  the  retention  by  the  consignor  of 
these  receipts  was  not  a  retention  of  the  in- 
dicia of  ownership,  but  that  the  same  passed  to 
the  consignee.  Whether,  if  counsel's  premises 
were  correct,  his  conclusion  would  be,  we  need 


204 


WHEN  TITLE  PASSES. 


not  consider.  These  instruments  consist  each 
of  a  receipt  for  the  goods,  and  an  agreement 
to  transport  them  to  a  certain  place,  and,  in 
our  opinion,  are  bills  of  lading.  See  Railway 
Co.  V.  ..Johnston  (Neb.)  G3  N.  W.  144. 

4.  Tliei-e  is  nothing  in  the  point  that  plain- 
tiff failed  to  establish  his  ownership  or  right 
to  possession  of  the  property.  He  must  have 
been  in  possession  of  the  property  when  he 
shipped  it.  It  is  true  that  it  appeal's  from  the 
er\-idence  that,   in  answer  to  Stevenson's  first 


inquiry  for  hay,  plaintiff  stated  that  he  had  no 
hay,  but  that  another  party  at  Roberts  had 
some,  which  he  was  going  to  press.  In  re- 
sponse to  Stevenson's  sec-ond  inquiry  for  hay 
and  oats  both,  plaintiff  shipped  the  two  cars, 
but  never  in  any  manner  claimed  to  be  acting 
for  said  third  party  (whose  name  is  nowhere 
disclosed),  nor  for  any  one  but  himself,  in 
making  such  shipment. 

This  disposes  of  the  case,  and  the  order  ap- 
pealed from  is  affii-med. 


WHEN  TITLE   PASSES. 


205 


FIFTH  NAT.    BANK   OF   CHICAGO   v. 
BAYLEY. 

(115  Mass.  228.) 

Supreme  Judit'ial   Court   of  Massachusetts. 
Suffolk.     June  18,  1874. 

lieplevin  for  four  hundred  barrels  of  flour. 
In  the  superior  court  judjiment  was  ordered 
for  the  plaintiff  on  aj^reed  facts  in  substance 
as  follows,  and  the  defendant  appealed  to 
this  court: 

On  June  5  and  6,  1871,  R.  H.  Sa^e  owned 
and  shipped  at  Chicago  for  Boston  five  hun- 
dred barrels  of  flour  by  bills  of  lading  where- 
by the  flour  was  deliverable  to  his  own  or- 
der. On  the  same  days  he  made  drafts  in 
favor  of  I.  G.  Lombard,  the  plaintiff's  ca'sh- 
ier,  upon  E.  Williams  &  Co.,  Boston,  one  for 
^^■.1.8^K1.  and  the  other  for  $1,000.  and  attached 
the  bills  of  lading  thereto,  and  indorsed  on 
each  bill  of  lading,  "Deliver  the  within  to  the 
order  of  E.  Williams  &  Co.  R.  H.  Sage," 
and  delivered  the  bills  of  lading  to  the  plain- 
tiff as  collateral  f  ecurity  for  the  payment  of 
the  said  sums  which  the  plaintiff  advanced 
him  thereupon.  The  plaintiff  then  forward- 
ed all  the  papers  to  Boston  for  collecton. 

These  drafts  were  duly  presented  to  E. 
Williams  &  Co.,  who  refused  to  accept  them, 
and  they  were  immediately  returned  to  the 
plaintiff. 

On  June  13,  when  the  $1,000  draft  was  re- 
ceived by  the  plaintiff  in  Chicago,  Sage  de- 
livered to  the  plaintiff,  in  exchange  for  it,  a 
draft  on  Crockett  Bros,  for  $1,000,  and  for 
the  retiu'ned  bill  of  lading  which  was  deliv- 
ered up  to  the  transportation  company,  .a 
new  original  bill  of  lading,  indorsed:  "De- 
liver to  the  order  of  Crockett  Bros.  R.  H. 
Sage."  The  plaintiff  then  forwarded  all  the 
papers  to  Boston  for  collection. 

On  June  l(3th,  when  the  $1,800  draft  on  E. 
Williams  &  Co.  arrived  in  Chicago.  Sage  paid 
the  plaintiff  on  account  $800,  and  delivered 
to  the  plaintiff,  in  exchange  for  the  balance 
of  the  returned  draft,  a  new  draft  for  $1,."')(X>, 
on  Crockett  Bros.,  and  for  the  returned  bill 
of  lading,  which  was  delivered  up  to  the 
transportation  company,  a  new  original  bill 
of  lading,  indorsed:  "Deliver  to  the  order  of 
Crockett  Brothers.  R.  H.  Sage."  The  plam- 
tiff  then  forwarded  all  the  papers  to  Boston 
for  collection. 


Both  lots  of  flour  arrived  in  Boston,  and 
.vliile  in  the  carrier's  hands,  two  hundred 
barrels  were  attached  by  the  defendant,  a 
deputy  sheriff,  upon  a  writ  in  favor  of  a 
creditor  of  Sage,  on  June  10th,  and  two  hun- 
dred barrels  on  June  19th. 

Crockett  Bros,  refused  to  accept  the  drafts, 
which,  with  the  other  papers,  were  then  im- 
mediately returned  to  the  plaintiff,  who 
again,  and  after  the  attachments  had  been 
made,  exchanged  the  bills  of  lading  for  bills 
of  lading  indorsed  to  the  plaintiff,  and  upon 
them  received  from  the  carrier  the  one  hun- 
dred barrels  not  attached.  The  plaintiff  then 
duly  made  demand  on  the  defendant  for  the 
attached  flour,  and  *lie  defendant  refused  to 
deliver  it  to  the  plaintiff;  and  thereupon  the 
plaintiff  replevied  the  same  in  this  action. 

E.  H.  Abbot  and  L.  A.  Jones,  for  plaintiff. 
G.  O.  Shattuck  and  O.  W.  Holmes,  Jr.,  for  de- 
fendant. 

GRAY,  C.  J.  This  case  is  governed  by 
those  of  National  Bank  of  Cairo  v.  Crocker, 
111  Mass.  103,  and  National  Bank  of  Green 
Bay  V.  Dearborn,  11.5  Mass.  219. 

The  bills  of  lading  by  which  the  carrier 
undertook  to  deliver  the  goods  to  the  shipper 
or  his  assigns  were  representatives  of  the 
jiroperty.  The  delivery  of  those  bills  of  lad- 
ing to  the  plaintiff  corporation  as  collateral 
security  for  the  payment  of  its  advances,  al- 
though it  would  not  have  enabled  it  to  sue 
the  carrier  upon  the  contract  therein  made 
with  the  shipper,  yet  did  transfer  at  least  a 
special  property  in  the  goods  to  the  plaintiff, 
(for  which  its  discount  of  the  drafts  was  a 
valuable  consideration,)  and  gave  it  a  light 
of  immediate  possession  sufficient  to  main- 
tain replevin  against  the  shipper  or  any  one 
attaching  the  goods  as  his  property. 

The  drawees  of  the  draft  attached  to  each 
of  those  bills  of  lading  were  not  entitled  to 
the  bill  of  lading  or  the  property  described 
therein,  except  upon  acceptance  of  the  draft, 
and,  having  refused  to  accept  it,  tin-  order, 
indorsed  by  the  shipper  upon  the  bill  of  lad- 
ing, for  the  delivery  of  the  goods  to  the 
drawees,  never  took  effect.  Judgment  for 
the  plaintiff. 

ENDICOTT  and  DEVENS,  JJ.,  absent. 


206 


AVOIDANCE  OF  CONTRACT. 


KIMBALL  .t    al.    r.    SACJT'IN. 

(.",:!  N.  W.  110,  8!J  Iowa.  18i;.i 

Supit'iuc  Cuiu-t  of  Iowa.      Oct.  7.  1S!I2. 

Appeal  from  district  foiirt,  Pollawattamie 
county:    IL   E.   Deenier,  Judj'e. 

Tliis  is  an  action  upon  a  promissory  note 
executed  l)y  defendant  Saguiu  to  defendant 
William  Siedeutopf  or  older,  l)y  whom  if  was 
assi.uned  to  defendant  FarusAvortli.  by  liini  to 
the  I'Mrst  National  Bank  of  Council  Blutts.  and 
by  said  bank  to  the  plaintiff.  Saguin  alone 
defends,  and  alleges  that  said  note,  together 
with  .$l,."»(ii»  in  cash,  was  given  to  Siedentopf 
in  consideration  of  a  conveyance  to  defendant 
of  certain  real  estate  by  said  Siedentopf ;  tliat 
for  the  purpose  of  inducing  defendant  to  make 
said  purchase  and  to  pay  said  money  and  ex- 
ecute said  note,  the  said  Siedentopf  made  cer- 
tain false  and  fraudulent  representations  con- 
cerning the  title  in  himself  to  said  real  estate, 
knowing  the  said  representations  to  be  fabe; 
that,  relying  tipon  said  false  repi'eseutatious  as 
true,  he,  the  defendant,  was  induced  to  pay 
sai<l  money  to  execute  said  note  to  Siedentopf, 
and  to  receive  from  him  his  deed  of  convey- 
ance for  the  real  estate  .so  purchased;  and 
that  the  title  so  conveyed  to  him  has  wholly 
failed;  wherefore  he  says  there  is  no  considera- 
tion for  said  note.  He  alleges  that  neither  the 
plaintiffs,  nor  either  of  the  assignees  of  said 
note,  were  bona  tide  pttrchasers  thereof  for 
value  before  due  Avithout  notice,  wherefore  he 
asks  that  said  note  be  fully  canceled.  Issues 
were  joined  by  reply,  the  case  submitted  to  a 
jn.ry.  and  a  verdict  for  defendant  Sagtiin,  with 
certain  special  tiudings,  rettirned.  .Tudgment 
was  entered  upon  the  verdict  and  tindings  in 
favor  of  defendant  Saguin.     Plaintiffs  appeal. 

Finley  Burke.  (Teorge  W.  Hewitt,  and  W. 
H.  Ware,  for  appellants.  A.  T.  &  I.  N.  Flick- 
inger,  for  appellee. 

GIVEN,  J.  1.  The  conveyance  from  Si(>- 
dentopf  to  Saguin  was  Avith  limited  covenants, 
as  follows:  '"Do  hereby  covenant  to  warrant 
and  defend  the  title  to  said  premises  against 
the  lawftil  claims  of  all  persons  claiming  by, 
throttgh.  or  tuider  me."  The  failui'e  of  title 
alleged  was  not  by  reason  of  any  person  claim- 
ing through  or  tmder  the  defendant  Siedentopf. 
but  because  of  his  having  no  valid  title  to 
the  property  conveyed.  There  is  no  allega- 
tion of  a  breach  of  the  covenant  in  the  deed, 
(U-  of  a  verbal  warranty  and  breach  thereof; 
but  the  defense  is  frattd  and  deceit  in  knowing- 
ly and  fratidulently  misrepresenting  the  title 
held  by  the  grantor.  Appellants  conteiKl  that 
an  action  or  defense  for  deceit  in  misrepre- 
sentation of  title  will  not  lie;  that  the  only 
remedy  for  a  failure  of  title  is  upon  the  cove- 
nants in  the  deed;  and  that,  where  these  are 
limited,  the  purchaser  takes  all  risks  not  cov- 
ered by  the  limited  covenant;  and  if  there  be 
no  covenant,  as  in  case  of  a  (pntclaim  deed, 
he  takes  all  risks  as  to  title;  that  when  it  is 
intended  that  the  vendor  shall  answer  for  llie 
title,  covenants  are  inserted  in  the  dt'cd  tliat 


define  the  terms  of  the  contract:  that  cove- 
nants will  not  be  implied;  and  that  the  piu'- 
cliaser  takes  the  title  at  his  own  risk,  except 
as  it  may  be  warranted  by  covenants  in  the 
(le(>(l.  In  considering  the  question  before  us 
we  uuist  keep  in  mind  the  distinction  between 
an  action  for  a  breach  of  warranty  and  an  ac- 
tion for  fratid  and  deceit.  Appellant  cites 
cases  wherein  the  courts  have  either  expressed 
doubts  upon  the  riglit  to  maintain  an  action  for 
fraudulent  representations  as  to  the  grantor's 
title,  or  the  oiiiniou  that  such  an  action  could 
not  be  maintained,  but  an  examination  of  these 
cases  shows  that  the  question  before  us  was 
not  involved  nor  determined.  In  Leonard  v. 
Pitney.  H  Wend.  .3(t.  Marcy.  J.,  says:  "Uouljts 
may  well  be  entertained  whether  an  action  at 
law  will  lie  for  a  deceitful  and  false  repre- 
.•-•entation  of  title  in  the  vendor  of  real  es- 
tate. Stich  an  action  has  not  as  yet,  I  be- 
lieve, been  sustained,  except,  it  may  be,  in 
some  of  the  states  where  the  same  tribunal  is 
possessed  of  equity  jurisdiction  as  well  as  the 
poAAers  of  a  coiul  of  common  laAA'.  There  is, 
hoAA'eA'er,  no  occasion  now  to  examine  that 
question."  In  Frost  v.  Raymond,  2  Caines,  at 
page  192.  the  court  recognizes  the  rule  "that, 
if  there  be  no  coA'enant  of  title  in  a  deed,  the 
purchaser  takes,  at  his  own  risk,  the  good- 
ness of  the  title."  It  is  said  "the  parties  to 
deeds  knoAv  that  a  covenant  is  reqtiired  to  hold 
the  seller  to  warrant  the  title,  and  they  regu- 
late their  contract  accordingly.  If  there  be 
any  fraud  in  the  sale  the  purchaser  has  his 
remedy.  If  one  sell  land,  affirming  he  had  a 
good  title,  Avhen  he  had  no  title,  an  action  on 
the  case  for  a  deceit  will  lie."  Here  the  dis- 
tinction betAveen  an  action  on  a  contract  of 
warranty  and  for  a  deceit  is  recognized,  and 
the  case  is  authority  for  the  right  to  maintain 
an  action  for  deceit.  In  Whitney  a-.  Allaire. 
1  N.  Y.  30.),  it  is  said  that  it  is  a  strong  argu- 
ment against  the  action  for  falsely  represent- 
ing the  title  that  no  precedent  for  it  has  been 
fottnd.  It  is  fttrther  said:  "It  is  not  neces- 
sary in  this  case  to  decide  Avhether  an  action 
Avill  lie  for  a  false  and  frattdulent  representa- 
tion by  the  A'endor  of  real  estate  that  he  has 
title  to  the  property;  for  that  question  seems 
not  to  haA'e  been  made  on  the  trial."  The 
only  case  from  other  states  Avherein  this  pre- 
cise qtiestion  has  been  determined,  that  we 
ar;'  al)le  to  find,  is  Peabody  v.  Phelps.  9  Cal. 
213.  At  page  220,  the  court  states  the  ques- 
tion to  be  "Avhether  an  action  for  a  false  and 
fraudtdent  representation  as  to  the  naked  fact 
of  title  in  the  vendor  of  real  estate  can  be 
maintained  by  the  pinchaser.  Avho  has  taken 
possession  of  the  premises  sold  under  the  con- 
veyances with  express  covenants."  The  cove- 
nant in  that  deed  Avas  to  AA'arraut  and  defend 
the  title  "from  me  and  my  heirs  and  as- 
signs forever."  The  court  says:  "The  pre- 
cise question  does  not  appear  to  have  been 
directly  decided.  There  are  dicta  in  the  Re- 
liorts.  but  Ave  have  been  unable  to  find  any 
adjudicated  case  on  the  exact  point."  The 
conclusion    reached    in    that   case   is   that   tlie 


AVOIDANCE  OP  CONTRACT. 


207 


action  could  not  be  niaintainotl.  Wc  think, 
however,  that  tlie  reasoning-  of  the  learned 
judge  shows  that  the  distinction  between  an 
action  for  deceit  and  for  breach  of  warranty 
was  lost  sight  of.  AA'hile  this  case  was  not 
overruled  in  ^^'rig■ht  v.  Carrillo,  22  Cal.  .590, 
its  correctness  was  questioned.  In  connnent- 
ing  upon  it  the  court  says:  "There  are  certain 
very  strong  reasons  for  contending  that  a  per- 
son obtaining  money  by  false  and  fraudulent 
representations  respecting  his  title  to  laud 
sliould  be  compelled  to  repay  it,— as  much  so 
as  the  seller  of  a  horse  or  other  personal  prop- 
erty; and  the  fact  that  the  vendee  has  neg- 
lected to  secure  himself  by  proper  covenants 
of  warranty  should  be  no  defense.  The  fraud 
may  have  been  perpetrated  and  falsehood  em- 
l)loyed  ^'or  the  very  purpose  of  inducing  the 
vendee  to  take  the  conveyance  without  any  or 
with  insufticieut  covenants.  Tliat  fraud  has 
been  successful  has  never  been  supposed  to 
deprive  the  party  defrauded  of  all  remedy. 
The  power  of  a  court  of  eiiuity,  as  well  as  of 
law,  has  heretofore  been  considered  most  po- 
tent in  such  cases;  but  if  such  be  the  law, 
they  are  powerless  in  the  most  aggravated 
cases  of  deceit.  The  ruling  upon  this  point 
in  Peabody  v.  Phelps,  is  clearly  in  conflict 
with  the  decision  in  Alvarez  v.  Brannan,  7 
Cal.  .j04,  and  it  should  be  reinvestigated  in 
some  case  where  it  can  properly  l)e  adjudged, 
and  upon  sufficient  argument  of  the  question." 
P.allou  V.  Luca.s,  59  Iowa,  22,  12  N.  W.  ~io, 
was  an  action  in  chancery  to  rescind  a  sale 
and  conveyance  of  land  on  account  of  fraudii- 
leut  representations  as  to  the  title.  Defend- 
ant insisted  that,  as  the  contract  of  purchase 
called  for  a  quitclaim  deed,  and  plaintiff  had 
accepted  such  a  deed,  "he  has  no  remedy 
against  defendant  for  the  fraudulent  repre- 
sentations as  to  the  title  of  the  land."  The 
court  says:  "The  position  is  based  upon  the 
familiar  rule  that  one  who  takes  lands  imder 
a  quitclaim  deed  is  not  to  be  regarded  as  a 
bona  tide  pui-chaser  without  notice  of  outstand- 
ing titles  and  equities.  But  this  doctrine  is 
not  applicable  to  this  case.  It  prevails  in  set- 
tling conflicting  titles,  and  is  intended  to  pro- 
tect equities  as  against  those  charged  with  no- 
tice of  their  existence.  It  is  never  invoked  to 
protect  a  fraudulent  grantor,  who.  by  false 
I'epresentations,  induces  a  contiding  purchaser 
to  believe  that  he  acquires  a  good  title  under 
a  quitclaim  deed.  *  *  *  It  would  be  a  re- 
proach to  the  law  to  hold  that  a  vendor  who, 
by  fraudulent  representations,  has  induced  a 
vendee  to  accept  a  quitclaim  deed  for  land, 
can    wholly    escape    lial)iliry    for    his    fiaud." 


This  case  is  decisive  of  tlie  (luestion  before  us, 
and  leads  us  to  the  couc-lusion  that  the  con- 
tention of  appellants  on  this  point  is  not  well 
founded. 

2.  Appellants  complain  of  certain  rulings  in 
admitting  and  rejecting  testimony.  They  of- 
fered to  prove  that  Saguiu  knew  of  the  de- 
fects in  the  tax  title  upon  which  the  convey- 
ance to  him  was  based,  and  that  he  coidd 
purchase  the  patent  title  at  less  than  ^10  per 
lot.  They  also  offered  to  prove  the  price  at 
which  the  patent  title  had  been  purchased  V)y 
others.  This  evidence  was  properly  excluded. 
There  Avas  no  question  of  damage  submitnd 
to  the  jury.  The  issues  submitted  were  as  to 
the  alleged  fraud,  failure  of  title,  and  consi.l- 
eration  in  the  note,  and  whether  appellants 
Vy'eve  purchasers  for  value  before  due  without 
notice.  Saguin  was  not  bound  to  prevent  a 
failure  in  the  consideration  of  tlie  note  by  buy- 
ing the  patent  title,  even  if  such  a  purchase 
would  have  prevented  it.  After  the  evidence 
was  closed  and  the  argument  commenced,  ap- 
pellants offered  to  prove  by  the  assistant  cash- 
ier of  the  bank  that  he  had  no  notice  of  any 
defenses  to  the  note  at  the  time  the  bank  re- 
ceived it.  It  was  in  the  discretion  of  the  court 
whether  or  not  to  then  admit  further  evidence, 
an<l  there  is  nothing  to  show  that  this  discre- 
tion was  not  properly  exercised.  Appellants 
complain  that  they  were  improperly  restrict- 
ed in  the  cross-examination  of  the  defendant 
Saguin  and  the  witness  Flickinger.  The  rec- 
ord does  not  justify  the  complaint.  Most  of 
the  questions  were  not  proper  cross-examina- 
tion, and  others  were  immaterial,  or  subse- 
quently answered.  A  question  put  to  appel- 
lee in  chief  was  objected  to  as  leading,  and 
the  objection  overruled.  The  witness  was 
asked  what  Siedentopf  said  with  reference  to 
himself  or  his  grantor's  having  had  actual 
possession  of  the  property.  No  answer  was 
suggested  by  the  question, — only  the  subject 
upon  which.  Riedentopf's  statements  were  de- 
sired. We  discover  no  errors  in  the  rulings 
admitting  and  rejecting  testimony. 

3.  Appellants"  further  complaint  is  that  tlu- 
court  erred  in  not  setting  aside  the  verdict 
and  special  findings.  The  verdict  and  findings 
are  in  harmony,  and  have  support  in  the  evi- 
dence. The  case  was  fully  and  fairly  submit- 
ted to  the  jury,  and,  although  we  might  ar- 
rive at  a  different  conclusion  from  the  evi- 
dence, we  may  not  for  that  reason  disturb  the 
verdict.  There  being  evidence  to  support  tlie 
verdict,  and  there  being  no  prejiidiiial  errors 
in  tlie  submission  of  the  case,  the  judgment  of 
the  district  court  is  affirmed. 


208 


AVOIDANCE  OF  CONTRACT. 


MORSE  et  al.  v.  SHAW. 

(124  Mass.  59.) 

Supreme  .Judicial   Court  of   Massachusetts. 
Ilampdeu.      Feb.  8,  1S7S. 

Replevin  of  wool.  At  the  trial  in  tbe  su- 
perior court,  before  Rockwell,  .J.,  the  jury  re- 
turned a  verdict  for  the  plaintiffs;  and  the 
defendant  alleged  exceptions. 

G.  M.  Stearns  and  N.  A.  Leonard,  for  plain- 
tiffs.    G.  F.  Hoar,  for  defendant. 

MORTON,  J.  The  plaintiff.s  seeK  to  avoid 
a  sale,  upon  the  ground  that  they  wei-e  in- 
duced to  make  it  by  false  and  fraudulent  rep- 
resentations .of  the  defendant.  The  burden  is 
upon  them  to  show  that  the  defendant  know- 
ingly made  false  representations  of  matters  of 
fact  which  are  susceptible  of  knowledge. 
Representations  which  are  mere  expressions  of 
opinion,  judgment  or  estimate,  or  intended  as 
expressions  of  belief  onlj^  are  not  sufficient 
to  support  the  action.  They  must  be  state- 
ments of  facts  susceptible  of  knowledge,  as 
distinguished  from  mattei's  of  mere  belief  or 
opinion.  Safford  v.  Grout,  120  Mass.  20; 
Litclifield  V.  Hutchinson,  117  Mass.  19-3. 

At  the  trial  of  this  case,  the  presiding  jus- 
tice stated  these  principles  of  law  with  sub- 
stantial correctness,  and  the  defendant  does 
not  complain  of  the  rulings  in  this  respect. 
But  he  contends  that  the  only  representations 
proved  in  the  case  were  expressions  of  opinion 
or  belief  as  to  the  defendant's  ability  to  pay 
his  debts,  and  that,  therefore,  under  rules  of 
law  adopted  by  the  presiding  judge,  he  should 
have  instructed  the  jury,  as  requested,  that 
the  evidence  would  not  warrant  a  verdict  for 
the  plaintiffs. 

The  evidence  tended  to  show  that,  in  .Tanu- 
aiy,  1876,  the  defendant  went  to  the  plaintiffs 
to  buy  wool,  and.  after  some  conversation  as 
to  his  business  condition  and  credit,  agreed  to 
go  home  and  prepare  a  statement  of  his  af- 
fairs; that,  in  the  Februaiy  following,  he  again 
■called  upon  the  plaintiffs,  took  out  a  memo- 


randum book,  apparently  read  it,  and  said: 
"I  want  to  tell  you  how  I  stand.  I  could  pay 
eveiy  dollar  of  indebtedness  of  mine,  including 
the  mca'tgages  on  my  real  estate,  and  not  OAve 
on  that  real  estate  more  than  .$1.5,0fJ0  to  ^20,- 
000."  It  appeared  that  he  had  a  large  and 
valuable  real  estate.  The  statement  is  eqviiv- 
alent  to  a  representation  that  he  had,  inde- 
pendently of  his  real  estate,  proi>erty  enough 
to  pay  all  his  debts  except  $20,000. 

Such  a  representation  may  be  susceptible  of 
either  of  two  interpretations.  It  may  be  in- 
tended as  a  willfully  false  statement  of  a  fact, 
and  may  be  understood  as  a  statement  of  a 
fact.  Or  it  ma^-  be  intended  as  the  expres- 
sion of  the  opinion  or  estimates  which  the 
owner  has  of  the  value  of  his  property,  and 
may  be  so  understood.  Suppose,  for  instance, 
that  a  man  who  owns  property  worth  $1,000, 
for  the  purpose  of  procuring  credit,  repre- 
sents that  he  is  worth  or  that  he  has  property 
worth  $100,0<JO.  It  would  be  self-evident  that 
he  intended  to  misrepresent  facts,  and  such 
misrepresentation  would  be  a  fraud.  But,  if 
the  same  man  should  represent  that  he  had 
property  worth  $1,500,  it  might  well  be  re- 
garded as  an  expression  of  his  judgment  or 
estimate  of  value,  and  therefore  not  an  ac- 
tionable fraud.  In  such  cases,  it  is  for  the 
jury  to  determine  wliether  the  representations 
were  intended  and  understood  as  statements 
of  facts,  or  mere  expressions  of  opinion  or 
judgment.  In  the  case  at  bar,  the  court  could 
not  say,  as  matter  of  law,  that  the  statements 
made  by  the  defendant  as  to  his  property  and 
debts  were  mere  expressions  of  his  opinion  or 
belief,  and  not  statements  of  facts.  All  the 
evidence  was  before  the  jury,  disclosing  the 
circumstances  and  condition  of  the  defendant 
and  his  property,  and  it  was  properly  left  to 
them  to  decide  whether  the  staten:ents  proved 
were  false  and  fraudulent  represeutalions  of 
material  facts. 

Exceptions  overruled. 

ENDICOTT  and  LORD.  .T.L.  alisent 


AVOIDANCE  OF  CONTRACT. 


209 


LITCHFIELD  r.  HUTCHINSON. 

(117  Mass.  195.) 

Supreme  .Tiulicial  Court  of  Massachusetts. 
Middlesex.      Feb.  1,  ISTo. 

Tort  for  deteit  in  the  sale  of  a  horse.  The 
declaratiou  alleged  that  the  defendant  sold 
plalutlir  a  horse  for  !i>32.5;  that  defendant 
falsely  represented  that  the  horse  was  sound 
in  everj-  way,  to  induce  plaintiff  to  buy;  that 
the  plaintiff,  believing  that  said  representa- 
tion was  true,  was  thereby  induced  to  buy 
the  horse,  but  the  horse  was  not  sound  in  ev- 
ery way,  but  Avas  lame  and  foundered,  and 
lame  in  the  fore  legs  and  shoulders,  and  was 
unsound  and  of  little  value,  as  defendant  well 
knew.  Answer  a  general  denial.  The  court 
allowed  a  bill  of  exceptions  to  the  effect  that 
there  was  evidence  that  the  defendant  made 
the  representations  as  alleged;  that  they  were 
falso,  and  known  by  defendant  to  be  false; 
that  the  plaintiff,  relying  thereon,  was  in- 
duced to  purchase  the  horse  as  alleged;  and 
that  the  horse  was  then  in  fact  lame  and  un- 
sound. The  evidence  was  conflicting  on  all 
these  points.  Plaintiff"  paid  defendant  ^'625 
for  the  horse,  and  there  was  evidence  that  he 
was  not  worth  at  the  time  of  the  sale  over 
$100.  The  defendant  testified  that  he  made 
no  representations  whatever,  and  that  he 
had  worked  the  horse  almost  every  day  for 
three  weeks,  and  did  not  observe  any  lame- 
ness or  that  he  was  unsound.  Upon  this  evi- 
dence the  plaintiff"  requested  the  judge  to 
charge  that,  if  the  defendant  made  a  repre- 
sentation of  the  sotmdness  of  the  horse  as  of 
bis  own  knowledge,  he  might  have  known  by 
reasonable  inquiry  and  examination  whether 
lie  was  sound  or  not,  and  the  horse  was  not 
sound,  and  if  the  plaintiff"  relied  on  such  rep- 
resentations, and  was  induced  thereby  to  pur- 
chase the  horse,  and  thereby  sustained  dam- 
age, the  defendant  was  liable.  If  the  de- 
fendant represented  that  the  horse  was  sound, 
when  he  was  unsound,  and  the  plaintiff"  was 
thereby  induced  to  buy  the  horse,  and  was 
thereby  injm-ed,  then  the  defendant  was  lia- 
ble. If  the  defendant  knew  the  horse  was 
unsound,  and  did  not  make  such  fact  known 
to  the  plaintiff",  but  allowed  him  to  purchase 
the  same  at  a  fair  market  price  as  a  sound 
horse,  then  the  defendant  was  guilty  of  fraud, 
and  was  liable.  If  the  defendant  had  no 
knowledge  one  way  or  the  other  as  to  the 
.soimdne.ss  of  the  horse,  but  represented  to  the 
plaintiff"  that  he  was  sound,  and  he  was  in 
fact  unsound,  it  would  support  the  allegation 
that  he  made  to  the  plaintiff"  a  false  allegation 
knowingly.  If  the  defendant  made  the  repre- 
sentations to  the  plaintiff  without  any  knowl- 
edge, information,  or  ground  of  belief,  and 
they  were  in  fact  false,  it  would  not  differ 
legally  from  a  representation  known  by  the 
defendant  to  be  false.  The  judge,  instead, 
instructed  the  jurj-  that  if  the  defendant  made 
the  representations  alleged,  as  matter  of  fact 
within  his  own  knowledge,  and  the  represen- 

VAX  Ztl.E  SEL.C.\S. SALES — 14 


tat  ions  in  any  material  respect  were  not  true, 
and  the  defendant  knew  they  were  false,  or 
he  did  not  honestly  believe  them  to  be  true, 
and  the  plaintiff",  relying  upon  them  as  true, 
was  induced  to  purchase  the  horse  and  pay 
therefor,  the  defendant  was  iialile.  But  that 
the  action  could  not  be  maintained  by  mere- 
ly proving  that  the  defendant  had  reasonable 
cause  to  believe  the  representations  were  un- 
true; the  declaration  alleging  that  they  were 
fraudulently  made,  and  that  the  defendant 
knew  them  to  be  false,  and  that  a  false  repre- 
sentation is  knowingly  made  when  a  party, 
for  a  fraudulent  purpose,  states  what  he  does 
not  believe  to  be  true,  even  though  he  may 
have  no  knowledge  on  the  subject.  The  jury 
returned  a  verdict  for  the  defendant,  and  the 
plaintiff"  alleged  exceptions. 

D.  S.  Richardson  (G.  F.  Richardson,  with 
him),  for  plaintiff".  W.  S.  Gardner,  for  de- 
fendant. , 

MORTON,  J.  This  is  an  action  of  tort,  in 
which  the  plaintiff"  alleges  that  he  was  induced 
to  buy  a  horse  of  the  defendant  by  represen- 
tations made  by  him  that  the  horse  was  sound, 
and  that  the  horse  was,  in  fact,  unsound  and 
lame,  all  of  which  the  defendant  well  knew. 

To  sustain  such  an  action  it  is  necessary 
for  the  plaintiff  to  prove  that  the  defendant 
made  false  representations,  which  were  ma- 
terial, with  a  view  to  induce  the  plaintiff"  to 
purchase,  and  that  the  plaintiff"  was  thereby 
induced  to  purchase.  But  it  is  not  always 
necessary  to  prove  that  the  defendant  knew 
that  the  facts  stated  by  him  were  false.  If 
he  states,  as  of  his  own  knowledge,  material 
facts  susceptible  of  knowledge,  which  are 
false,  it  is  a  fraud  which  renders  him  liable 
to  the  party  who  relies  and  acts  upon  the 
statement  as  true,  and  it  is  no  defence  that  he 
believed  the  facts  to  be  true.  The  falsity  and 
fraud  consists  in  representing  that  he  knows 
the  facts  to  be  true,  of  his  own  knowledge, 
when  he  has  not  such  knowledge.  Page  v. 
Bent,  2  Mete.  (Mass.)  371;  Stone  v.  Denny, 
4  Mete.  (Mass.)  151;  Milliken  v.  Thonidike, 
103  Mass.  382;  Fisher  v.  Mellen.  Id.  503. 

In  the  case  at  bar  the  plaintiff"  asked  the 
court  to  instruct  the  jury  "that  if  the  defend- 
ant made  a  representation  of  the  soundness 
of  the  horse,  as  of  his  own  knowledge,  and 
the  jury  are  satisfied  that  he  might  have 
known  by  reasonable  inquiry  and  examina- 
tion whether  he  was  sound  or  not,  and  the 
horse  was  not  sound  as  a  matter  of  fact,  and 
if  the  plaintiff"  relied  on  such  representations, 
and  was  induced  thereby  to  purchase  the 
horse,  and  thereby  sustain  damage,  then  the 
defendant  is  liable."  We  are  of  opinion  that 
this  instruction  should  have  been  given  in 
substance.  If  the  defect  in  the  horse  was  one 
which  might  have  been  known  by  reason- 
able examination,  it  was  a  matter  susceptible 
of  knowledge,  and  a  representation  by  the  de- 
fendant made  as  of  his  own  knowledge  that 
such  defect  did  not  exist,  would,  if  false,  be 


210 


AVOIDANCE  OF  CONTRACT. 


a  fraiul  for  which  he  wouhl  he  liable  to  the 
plaintiff,  if  made  with  a  view  to  induce  him 
to  purchase,  and  if  relied  on  by  him. 

A  false  representation  of  this  character  is 
sufficiently  set  forth  in  the  declaration  to 
constitute  a  cause  of  action,  without  the  fur- 
ther allegation  that  the  defendant  well  knew 
the  representations  to  be  false.  It  is  not  nec- 
essary that  all  th-  allegations  should  be  prov- 
ed ifenough  are  proved  to  make  out  a  cause 
of  action. 


The  instructions  given  upon  the  subject  em- 
braced in  this  prayer  required  the  plaintiff  to 
prove,  not  only  that  the  defendant  made  the 
false  representations  alleged,  as  of  his  own 
knowledge,  but  also  that  the  defendant  knew 
that  they  were  false,  or  that  he  did  not  hon- 
estly beiieve  them  to  be  true.  In  this  respect 
the  instructions  were  erroneous. 

Exceptions  sustained. 

AMES  and  EXDICOTT,  .JJ.,  absent. 


AVOIDANCE  OF  CONTRACT. 


21i 


GALLOWAY  et  al.  v.  MERCHANTS'  BANK 
OF  NELIGH  et  al. 

(60  N.  W.  569,  42  Neb.  2.j9.) 
Supreme  Court  of  Nebraska.      Oct.  16,  1894. 
Appeal  from  disti'ict  com*t,  Antelope  coun- 
ty;   Allen,  Judse. 

Action  by  William  C.  Galloway  and  wife 
and  others  asaiust  the  Merchants'  Bank  of 
Nelifih  and  Henry  L.  Pratt.  Judgment  for 
plaintiffs,  and  defendants  appeal.    Affirmed. 

W.  M.  Robertson,  for  appellants.  N.  D. 
Jackson,  for  appellees. 

HARRISON.  J.  April  30.  A.  D.  1891.  the 
appellees  herein  tiled  a  petition  in  the  dis- 
trict court  of  Antelope  county  alleging  in 
substance,  after  pleading  the  corporate  char- 
acter of  appellant  and  defendant  the  Mer- 
chants' Bank  of  Neligh:  That  on  or  about 
January  25,  1889,  appellees  were  indebted  to 
the  bank,  and  being  desirous  of  effecting  a 
loan  on  some  real  estate  then  owned  by  them, 
and  situated  in  Antelope  countj',  in  order  to 
pay  the  debt  to  the  bank,  and  being  solicited 
by  the  bank  to  make  an  application  to  or 
through  it  for  such  loan,  made  an  applica- 
tion in  writing,  in  which  all  the  terms  and 
conditions  of  the  loan  to  be  made  were  gen- 
erally stated,  except  that  no  mention  was 
therein  made  of  the  rate  of  interest  which 
should  be  paid  on  the  money  loaned  if  the 
loan  should  be  obtained;  the  contract  in  re- 
gard to  the  rate  of  interest  to  be  paid  by 
appellees  on  any  loan  effected  for  them 
being  that  they  were  to  pay  such  a  rate  of 
interest  as  might  be  demanded  by  the  party 
with  whom  the  loan  was  negotiated  or  effect- 
ed, and  no  more;  the  bank  not  to  charge  or 
receive  any  commission  or  bonus  for  making 
the  loan.  It  was  further  agreed  that  the 
president  of  the  bank  should  go  east  for  the 
pm'pose  of  procm-ing  the  loan;  the  appellees 
to  pay  all  the  necessaiy  expenses,  etc.,  of 
the  jom-ney.  Pursuant  to  this  understanding 
a  ti'ip  was  made  to  New  York  by  the  presi- 
dent of  the  bank,  and  a  loan  of  $12.(X>0  ne- 
gotiated for  appellees  with  one  Hem-y  L. 
Pratt,  the  rate  of  interest  to  be  7  per  centum 
per  annum.  That  the  appellees  executed 
notes  for  the  .$12,000,  payable  to  Heniy  L. 
Pratt  or  order,  with  interest  at  7  per  cent, 
per  annum,  and  a  real-estate  mortgage  to 
secm-e  its  payment,  and  executed  10  notes 
of  $120  each,  payable  to  Henry  L.  Pratt  or 
order  or  bearer;  whether  to  order  or  bearer 
being  one  of  the  facts  in  dispute  in  the  case, 
the  appellees  stating  that  these  10  notes 
were  made  payable  to  Heniy  L.  Pratt  or 
order,  and  altered  after  delivery,  and  with- 
out their  knowledge,  by  the  erasure  of  the 
word  "order,"  and  insertion  of  "beai'er." 
These  10  notes  were  payable  on  the  1st  of 
the  months  of  January  and  July  of  the  five 
years  succeeding  1889,  ending  with  January, 
1894,  and  were  secured  by  a  mortgage  on 
I'cal  estate  in  Antelope  county,  which  was 
particulai-ly  described  in  the  petition.     That 


appellees  were  induced  to  execute  the  lO 
notes  and  the  mortgage  securing  the  same  by 
the  representations  of  the  officers  of  the  bank 
to  the  effect  that  Heniy  L.  Pratt  demanded 
9  per  cent,  interest  per  annum  on  the  .$12,000 
loaned  to  appellees,  but  desired  it  divided 
as  above  indicated  for  his  convenience, 
which  representations  were  false  and  untnie, 
but  were  relied  upon  by  appellees,  and  by 
them  taken  as  true,  and  believed.  Tliat  the 
bank  retained  the  10  notes  and  the  mortgage 
securing  them,  and  3  of  them  were  paid 
by  appellees  before  they  discovered  that  they 
belonged  to  the  bank,  and  not  to  Pratt, 
and  had  been  retained  by  it  as  a  commission 
or  bonus  for  mi  \g  the  loan,  conti'arj'  to  the 
terms  of  the  agreement  between  the  bank 
and  appellees,  and  the  fm-ther  fact  that  Pratt 
had  demanded  and  was  to  receive  only  7 
per  cent,  on  the  $12,rx>0  loaned.  It  is  fur- 
ther alleged  that  they  paid  a  bill  of  $365, 
claimed  by  the  bank  to  be  the  expenses  of 
effecting  and  perfecting  the  loan.  The 
prayer  of  the  petition  was  for  a  cancellatioa 
of  the  remaining  seven  notes  of  $120  each, 
and  the  mortgage  securing  them,  the  quiet- 
ing of  title  in  plaintiffs  to  the  real  estate 
covered  by  the  mortgage,  and  a  judgment 
against  the  bank  for  the  amount  of  the  three 
notes  paid  to  it.  The  answer  of  the  bank 
admitted  the  existence  and  corporate  char- 
acter of  the  bank,  and  denied  each  and  eveiy 
other  allegation  of  the  petition,  except  the 
payment  of  the  three  notes  of  $120,  and. 
stated  or  admitted  they  were  paid  to  Pratt. 
The  answer  filed  for  Hem-y  L.  Pratt  ad- 
mitted that  the  banlv  existed  and  was  incor- 
porated as  stated  in  the  petition;  further, 
admitted  the  execution  of  the  notes  and 
mortgages  as  alleged  in  the  petition,  and  that 
he  made  the  loan  of  $12,(XK3  to  bear  interest 
at  the  rate  of  7  per  centum  per  annum,  and 
stated  that  his  understanding  was  and  is; 
tliat  the  10  notes  for  .$120  each  were  for  thc- 
sum  charged  by  the  bank  as  a  commissiors 
for  negotiating  or  effecting  the  loan  of  $12,tMK>,. 
and  denied  all  the  other  allegations  of  the 
petition,  and,  for  further  answer  or  cross 
bill,  declared  upon  the  7  notes  of  $120  each 
as  belonging  to  and  being  owned  by  the 
defendant  Henry  L.  Pratt,  and  asked  for 
foreclosm-e  of  the  mortgage  .seciu"ing  them 
for  alleged  bi'each  of  its  conditions  in  regard 
to  payment  of  the  notes.  The  appellees  filed 
a  reply  to  these  several  answers,  in  whiclt 
all  new  matter  in  the  answers  was  deuietl. 
and  the  fact  of  the  alteration  of  the  10  notes 
was  pleaded,  and  it  was  further  alleged 
that  Pratt  was  not  the  owner  of  the  7  $12(> 
notes,  but  that  they  had  been  delivered  to 
him  in  fraud  of  appellees'  rights,  and  to 
prevent  them  from  obtaining  relief  in  this; 
action,  and  that  Pratt  well  knew,  and  was 
informed  at  the  time  the  notes  were  de- 
livered to  him,  all  the  facts  and  circum- 
stances attending  their  execution  as  pleaded! 
in  the  petition. 
A  trial  of  the  issues  to  the  court  resulted 


212 


AVOIDANCE  OF  CONTRACT. 


in  the  followini;  fiiulinss  and  decree,  from 
whifli  the  b;mk  and  Pratt  have  appealed  to 
this  court,  to  wit:  "Be  it  reni;>nibered 
that  on  this  20th  day  of  .Tune.  A.  D.  1802, 
this  cause  came  on  to  be  heard  before  the 
court;  the  plaintiffs  appearing  by  N.  D. 
.Tackson.  their  attorm^y;  the  defendants. 
by  W.  M.  Robertson,  their  attorney.  And 
thy  evidence  was  submitted  to  the  court, 
and  the  court,  after  hearing  the  argument 
of  counsel,  and  being  fully  advised  in  the 
premises,  finds  for  the  plaintiffs,  and  that 
the  allegations  contained  in  the  plaintiffs' 
petition  are  true;  that  on  or  about  the 
•_'.">th  day  of  January,  1880,  the  defendant  the 
.Merchants'  Bank  of  Neligh  negotiated  for 
the  plaintiffs  a  loan  for  the  sum  of  .$12,000 
from  the  defendant  Henry  L.  Pratt;  that  the 
contract  between  the  plaintiffs  and  the  de- 
fendant the  Merchants'  Bank  of  Neligh  for 
the  negotiation  of  said  loan  was  in  writing, 
except  the  contract  as  to  the  rate  of  intei'- 
est  to  be  paid  by  the  plaintiffs;  that  the  de- 
fendant the  ^Merchants'  Bank  of  Neligh 
agreed  with  the  plaintiffs  at  the  time  of  the 
execution  of  said  contract  that  the  rate  of 
interest  on  said  loan  would  be  such  rate 
of  interest  as  the  said  defendant  the  Mer- 
chants' Bank  of  Neligh  would  be  enabled  to 
negotiate  said  loan  for  in  the  east,  and  that 
the  plaintiffs  would  not  be  required  to  pay 
any  other  or  greater  rate  of  interest  than 
that  for  which  the  note  could  be  negotiated, 
and  that  plaintiff's  should  not  be  required  to 
pay  the  defendant  the  Merchants'  Bank  of 
Neligh  any  commission  fees  or  charges,  ex- 
cept the  actual  expenses  incurred  in  nego- 
tiating said  loan;  that  the  said  loan  was  ne- 
gotiated for  the  pui-pose  of  paying  an  in- 
debtedness to  the  said  defendant  the  Mer- 
chants' Bank  of  Neligh;  that  at  the  time  of 
the  execution  of  the  notes  and  mortgages 
.securing  the  said  loan  the  defendant  the 
Merchants'  Bank  of  Neligh  falsely  repre- 
sented to  the  plaintiffs  that  the  rate  of  in- 
terest demanded  by  the  defendant  Henry 
L.  Pratt,  to  whom  the  said  note  had  been 
negotiated,  was  0%,  and  that  the  defendant 
Henry  L.  Pratt  desired  the  plaintiff's  to  exe- 
cute and  deliver  to  the  defendant  Henry  L. 
Pratt  a  note  for  the  sum  of  .$12.(X)0,  draw- 
ing interest  at  the  rate  of  7%  per  annum, 
payable  semiannually,  and  ten  notes  for  the 
sum  of  ^120  each,  representing  the  remain- 
der of  the  9%  interest,  one  payable  in  six 
months  from  the  date  of  execution  of  said 
notes,  and  one  each  six  months  thereafter, 
until  said  notes  were  fully  paid;  that  there- 
upon the  plaintiffs,  relying  upon  the  repre- 
sentation of  the  defendant  the  Merchants' 
Bank  of  Neligh,  executed  and  delivered  to 
the  defendant  the  Merchants'  Bank  of 
Neligh.  for  the  use  and  benefit  of  the  defend- 
ant Henry  L.  Pratt,  a  note  for  the  sum  of 
§12.000.  drawing  interest  at  the  rate  of  7% 
per  annum,  and  a  mortgage  upon  the  prop- 
erty in  Antelope  county  securing  the  same, 
and  10  notes  of  $120  each,  payable  to  Henry 


L.  Pratt  or  bearer,  one  payable  on  the  1st 
day  of  July,  1889,  and  one  each  six  months 
thereafter,  and.  to  secure  the  payment  of 
said  notes,  executed  and  delivered  to  the 
defendant  Merchants'  Bank  of  Neligh.  for 
the  use  and  benefit  of  the  defendant 
Henry  L.  Pratt,  a  mortgage  upon  the 
following  described  real  estate,  situate 
in  Antelope  county.  Nebraska,  to  wit, 
block  twenty-two  (22)  in  the  city  of  Neligh, 
and  the  said  mortgage  was  filed  for  rec- 
ord in  the  office  of  the  county  clerk  of  An- 
telope county.  Nebraska,  on  the  28th  day  of 
January,  1889,  at  three  o'clock  p.  m.,  and 
recorded  in  Book  W  of  Mortgages,  at  page 
48;^;  and  that  the  plaintiffs  also  paid  the 
defendant  the  Merchants"  Bank  of  Neligh 
about  the  sum  of  .$.305,  expenses  in  negoti- 
ating said  loan.  The  plaintiffs  have  paid 
the  note  for  .S120  which  matured  on  the  1st 
day  of  July,  1889,  and  the  note  for  $120 
which  matm-ed  on  the  1st  day  of  January. 
18:^M),  and  the  note  for  $120  which  matured 
on  the  l.st  day  of  July,  1890.  The  court  fur- 
ther finds  that  the  defendant  the  Merchants' 
Bank  of  Neligh  negotiated  said  loan  to  the 
defendant  Henry  L.  Pi*att  at  an  agreed  rate 
of  interest,  and  that  the  rate  charged  and 
received  by  the  defendant  Henry  L.  I'ratt 
was  7%,  and  no  more;  that  the  defendant 
Mercliants'  Bank  of  Neligh  did  not  deliver 
to  the  defendant  Henry  L.  Pratt  the  ten 
promissorj-  notes  of  $120  each,  nor  the  pro- 
ceed.s  thereof,  but  unlawfully,  and  in  fraud 
of  the  plaintiff.s'  rights,  converted  said  ten 
notes  to  their  own  use  and  benefit.  The 
court  further  finds  that  the  three  notes 
paid  aforesaid  by  plaintiffs  were  paid 
to  the  defendant  the  Merchants'  Bank  of 
Neligh.  believing  that  said  notes  belonged 
to  the  defendant  Henry  L.  Pratt,  and  be- 
fore the  discovery  of  the  fact  that  the 
defendant  the  Merchants'  Bank  of  Neligh 
had  converted  said  notes  to  its  own  use. 
The  court  further  finds  that  after  the  pay- 
ment of  the  threfi  notes  aforesaid  the  de- 
fendant the  Merchants'  Bank  of  Neligh  con- 
veyed the  remaining  seven  notes  to  the  de- 
fendant Henry  L.  Pratt,  but  that  the  de- 
fendant Henry  L.  I'ratt  acquired  the  title 
and  possession  of  said  notes  with  a  full 
knowledge  of  the  facts  hereinbefore  enu- 
merated. The  court  further  finds  that  no  con- 
sideration was  ever  paid  by  the  defendant 
the  Merchants'  Bank  of  Neligh,  or  received 
by  the  plaintiffs,  for  the  said  ten  notes  of 
$120  each,  and  the  mortgage  securing  the 
same,  and  that  said  notes  and  mortgage  are 
fraudulent  and  void,  and  that  the  plaintiffs 
are  entitled  to  have  the  same  surrendered  to 
them,  and  the  said  mortgage  canceled,  and 
the  cloud  created  thereby  upon  the  title  to 
the  plaintiffs'  propertj\  to  wit,  block  twen- 
ty-two (22)  in  the  city  of  Neligh,  Antelope 
county.  Nebraska,  removed.  It  is  therefore 
considered,  adjudged,  and  decreed  by  the 
court  that  the  defendants  surrender  to  the 
plaintiffs  the  seven  notes  of  $120  each,  paj- 


AVOIDANCE  OF  CONTRACT. 


213 


able  as  follows:  One  each  ou  the  1st  day 
of  the  mouths  of  Jaiuuu-y  and  July,  1891; 
one  each  ou  the  1st  day  of  January  and 
July,  1892;  one  each  on  the  1st  day  of  Jan- 
uary and  July,  1893;  and  the  one  which 
matures  on  the  1st  day  of  January,  1894,— 
and  that  the  mortgage  given  to  secure  the 
same,  to  wit,  the  mortgage  executed  by  the 
plaintiffs,  and  filed  in  the  office  of  the  coun- 
tj''  clerk  of  Antelope  county,  Nebraska,  on 
the  28th  day  of  January,  1889,  at  three  o'clock 
p.  m.,  and  recorded  in  Book  W  of  Mort- 
gages, at  page  4So,  be,  and  the  same  hereby 
is,  canceled  and  annulled,  and  rendered  whol- 
ly void  and  of  no  force  and  effect,  and  that 
the  cloud  created  by  the  said  mortgage  upon 
the  title  of  the  plaintiffs  be,  and  the  same 
hei-eby  is,  removed,  and  the  defendants,  and 
each  of  them,  are  enjoined  and  restrained 
from  claiming  any  lien,  title,  or  other  interest 
in  said  property  by  virtue  of  said  mortgage, 
and  that  the  plaintiffs  have  and  recover  from 
the  defendant  the  Merchants'  Bank  of  Ne- 
ligh  the  sum  of  $410,  with  interest  thereon  at 
the  rate  of  seven  per  cent  per  anniim  from 
this  date.  To  all  of  which  findings  the  de- 
fendants at  the  time  excepted.  And  after- 
wards, to  wit,  on  the  same  daj',  the  said 
cause  came  on  for  hearing  upon  the  motion 
of  the  defendants  for  a  new  trial;  and  the 
court,  after  hearing  the  argiunent  of  the 
counsel,  and  being  fully  advised  in  the 
premises,  overruled  said  motion.  To  which 
order,  ruling,  and  judgment  of  the  court  the 
defendants  then  and  there  duly  excepted, 
and  forty  days  are  allowed  to  settle  bill  of 
exceptions.  It  is  further  ordered  that  the 
defendants  have  and  recover  from  the  plain- 
tiffs herein  tlie  costs  of  this  action,  taxed  at 
$6.93.  Plaintiffs  except  to  that  portion  of 
the  decree  wherein  the  court  finds  that  the 
notes  in  controversy  were  made  payable  to 
Henry  L,  Pratt  or  bearer." 

The  main  contention  of  counsel  for  appel- 
lants in  brief  filed  is  that  the  findings  and 
decree  were  not  supported  by  the  evidence. 
We  have  read  and  carefully  examined  all 
the  testimony  in  the  case,  and  deem  it  un- 
necessary to  quote  from  it  at  large  and  com- 
ment upon  it  here,  but  a  full  consideration  of 
it  leads  us  to  conclude  that  the  determina- 
tion of  the  di-^trict  court  was  sustained  by 
the  evidence. 

Counsel  for  appellants  further  contend 
that  appellees  should  at  least  have  offered  to 
pay  what  it  was  reasonably  worth  to  prociu'e 
the  loan,  before  asking  to  have  the  commis- 


sion notes  and  their  accompanying  mort- 
gage canceled,  under  the  rule  that  "he  who 
seeks  equity  must  do  equity."  The  evi- 
dence shows  that  they  paid  the  bank  $305 
for  procuring  the  loan,  or  as  expenses  of 
the  trip  to  New  York  by  the  president  or 
officers  of  the  bank  to  negotiate  this  loan, 
in  exact  pursuance  of  the  terms  of  the 
agreement  of  the  parties,  as  contended  by 
appellees;  and,  having  determined  that  the 
finding  of  the  lower  court  that  the  con- 
tract was  as  alleged  or  claimed  by  the  appel- 
lees was  sustained  by  the  testimony,  the 
bank  must  be  held  to  its  terms,  and,  having 
been  paid  Avliat  it  agi'eed  to  take  according 
to  such  conti-act,  it  has  received  its  whole 
compensation,  and  it  was  unnecessary  for  the 
appellees  to  offer  to  pay  more  before  they 
were  in  a  position  to  ask  relief  in  a  coiu't  of 
equit.v. 

Having  reached  the  conclusion  that  the  find- 
ings of  fact,  as  announced  by  the  judge  of 
the  district  court,  were  supported  by  the 
evidence,  we  must  apply  to  them  the  rules 
which  govern  comls  of  equity  in  affording 
relief  in  cases  of  the  nature  of  the  one  at 
bar;  and  we  are  satisfied  that  the  case  was 
one  that,  by  its  facts  and  circumstances,  war- 
ranted the  remedy  granted.  The  rule  has 
been  stated  in  Barnard  v.  Iron  Co.  (Tenn.) 
2  R.  AV.  2.J,  as  follows:  "It  is  likewise  true 
that  where  a  partj^  intentionally  or  by  de- 
sign, misr;»i!:-esents  a  material  fact  or  pro- 
duces a  false  impression  in  order  to  mislead 
another,  or  obtain  an  undue  advantage  of 
him,  in  every  such  case  there  is  a  positive 
fraud,  in  the  fullest  sense  of  the  term.  Nor 
can  it  be  maintained  that  the  evidence  of 
the  fraudulent  representations  is  to  be  ex- 
cluded, upon  the  doctrine  that  all  repre- 
sentations are  merged  in  the  writings  sub- 
sequently executed  by  the  parties.  This 
rule  has  no  application  w'hen  a  suit  is 
brought  to  be  relieved  against  a  written 
instrument  on  the  ground  of  fraud.  The 
purpose  is  not  to  contradict  or  vary  the 
terras  of  the  written  agreement,  but  relief 
is  sought  upon  the  gi'omid  that  by  false  rep- 
resentations the  parties  are  entrapped  into 
an  agreement  which  they  would  not  other- 
wise have  made.  It  is  not  denying  the  deed, 
nor  its  terms,  to  insist  that  it  is  vitiated  by 
fraud;"  citing  Finlay  v.  King's  Lessee,  3  Pet. 
382.  See,  also,  Insurance  Co.  v.  Huyck  (Ind. 
App.)  32  N.  E.  580.  and  citations.  Tho  de- 
cree of  the  district  court  is  aflu-med.  Af- 
firmed. 


214 


AVOIDANX'E  OF  CONTRACT. 


MAXTED  V.  FOWLER. 

(53  N.  W.  U-2\,  'M  Mith.  100.) 

Supreme  Court  of  MicluKau.    Dec.  22,  1S92. 

Error  to  {'ircuit  court,  Manistee  county; 
-I.    r.yi-on  .ludUins.  .ludjjfe. 

Action  by  John  I).  Max  ted  against  Suiitli 
AV.  Ft)\vler.  Judj^nient  for  plaint itt'.  De- 
fendant appeals.     Reversed. 

Calilll  iV:  Ostraudi'r.  for  api)ellant.  Xis- 
){e)-n   cV-   ^^■iIlley,   for  ai)pellee. 

MONTtiO.MFRY.  J.  The  plaintiff  l)rou,s,'ht 
an  action  to  recover  damages  for  a  breach 
of  warranty  allejied  to  have  been  made  by 
*lefendant  on  an  exchange  of  property  own- 
ihI  l»y  plaintiff  for  stock  in  a  niininjr  cor- 
l>oration  transferred  to  him  by  the  defend- 
ant. On  a  trial  before  a  jury  in  the  ^lan- 
istee  circuit  a  judgment  was  rendered  for 
^l.(;.")T.r)(>.  From  this  judgment  defendant 
i)ppeals. 

The  plaintiff's  testimony  tended  to  show 
that  he  exchanged  property  in  Manistee, 
vjilued  at  «j51.8UO,  for  mining  stock,  which, 
nt  7.")  cents  per  share,  amounted  to  .^1,300, 
and  ?.")(>()  in  cash;  that  the  defendant  ex- 
liibited  specimens  which  he  claimed  came 
from  the  mine  of  the  company,  and  assur- 
ed plaintiff  that  he  (defendant)  was  going 
to  make  a  rich  mau  of  him,  and  that  the 
stock  was  then  selling  for  .?1  per  share,  but 
that,  as  the  company  desired  to  engage 
plaintiflf's  services,  and  to  have  him  inter- 
«\sted.  he  would  let  him  have  the  stock  at 
7~)  cents;  that  he  (defendant)  would  make 
"tlie  stock  worth  .^^2  a  share  inside  of  six 
months.  The  mine  owned  by  the  corpora- 
tion was  not  developed,  consisted  of  little 
more  than  an  excavation,  and  the  plaintiff 
testified  that  he  Avas  wholly  unacquainted 
with  mining  property,  and  of  this  the  de- 
fendant was  advised.  The  circuit  .judge 
charged  the  jury:  "If  the  defendant  repre- 
sented to  the  plaintiff  that  the  stock  was 
worth  a  dollar  a  share,  that  he  would  make 
it  worth  two  dollars  a  share,  and  that  the 
plaintiff  relied  upon  and  acted  upon  this 
I'epre.sentation,  and  turned  out  his  property 
for  the  ^'AX)  and  the  stock,  and  if  the  jury 
also  find  that  the  stock  Avas  utterly  worth- 
less, the  plaintiff  would  be  entitled  to  re- 
cover." Defendant's  first  contention  is  that 
these  representations  of  value  are  not  such 
as  a  purchaser  has  a  right  to  rely  upon.  He 
invokes  the  rule  that  any  purchaser  must 
«'xpect  that  the  vendor  will  seek  to  enhance 
his  wares,  and  must  disregard  the  vendor's 
.-statements  as  to  value.  This  is  undoubtedly 
the  general  rule,  but  it  is  subject  to  excep- 
tions. Where  the  defendant  knows  that  the 
plaintiff  is  wholly  ignorant  of  the  value  of 
the  pi-opei-ty.  and  knows  that  he  is  relying 
ui)on  the  defendant's  representation,  and 
such  rejiresentation  does  not  take  the  form 
'of  a  mere  expression  of  opinion,  and  is  in 
the  nature  of  a  statiMuent  of  fact,  the  rule 


of  caveat  em])tor  does  not  necessarily  apply. 
Picard  v.  McCormick.  11  Mich.  GS;  Man- 
ning V.  Albee,  11  Allen,  .j20;  T..awtou  v. 
Kittredge,  :'.()  N.  H.  500;  Bradley  v.  Poole, 
1)8  Mass.  l(i!>;  Miller  v.  Barber,  OC  N.  Y. 
5."kS;  Gerhard  v.  Bates,  20  Kng.  Law  &  Eq. 
12!l.  We  think,  under  the  circumstances  of 
this  case,  that  the  plaintiff  had  the  right  to 
rely  upon  the  defendant's  statement  that 
the  stock  was  i-eadily  selling  at  a  dollar  a 
share.  This  was  a  statement  of  fact  which 
the  testimony  shows  to  be  unti'ue,  and  it 
cannot  be  doubted  that  such  a  statement 
would  have  a  material  infiuence  upon  the 
purchaser.  In  Medbury  v.  Watson,  (i  Mete. 
(Mass.)  2.59,  an  action  was  maintained  for 
false  and  fraudulent  representations  as  to 
the  price  paid  by  a  tliird  person  for  the 
property  in  question.  In  Manning  v.  Albee, 
supra,  it  was  said:  "In  the  case  now  before 
us  the  plaintiff  offered  to  show  that  he  was 
induced  to  part  with  his  goods  by  the  false 
and  fraudulent  representations  of  French 
and  the  defendant,  not  only  as  to  the  value 
of  the  bonds  offered  by  French  to  secure  the 
note  given  by  him  for  the  goods,  but  also 
as  to  the  sales  of  such  bonds  in  the  market 
at  a  certain  price,  appearing  by  a  publish- 
ed list  of  sales  of  stocks  and  securities, 
which  they  exhibited  to  him  to  have  actual- 
ly taken  place.  This  last  representation  was 
one  which  the  plaintiff  is  not  shown  to  have 
had  eipial  means  of  knowing  the  truth  or 
untruth  of,  and  on  which  he  might,  with- 
out imputation  of  negligence,  rely,  and,  up- 
on discovering  it  to  be  false  and  fraudulent, 
maintain  an  action.'"  In  Miller  v.  Barber, 
a  representation  that  a  patent  owned  by 
the  company  was  of  great  value,  and  that 
certain  otlier  persons  were  owners  of  stock, 
was  held  to  have  been  such  a  representation 
as  the  purchaser  had  a  right  to  rely  upon. 
In  Lawton  v.  Kittredge,  a  representation 
that  certain  stock  "is  good  property  or  in- 
vestment, and  is  about  to  make  a  dividend," 
is  held  to  be  a  false  representation  when  un- 
true, and  where  the  person  taking  the  stock 
objected  to  receiving  it  on  account  of  his 
doubt  or  ignorance  as  to  its  value.  In  Brad- 
ley V.  Poole,  representations  that  a  corpo- 
rate property  is  valuable,  and  one  of  the 
best  properties  in  Colorado,  when  in  fact 
the  company  was  a  bubble  company,  raises 
a  question  of  fraud  for  the  jury  to  pass  up- 
on. We  think  that  the  representation  as 
to  the  market  value  of  stock  of  this  charac- 
ter is  a  representation  of  a  fact  which  bears 
upon  the  question  of  the  actual  value,  and 
there  was  no  error  in  so  instructing  the 
jury. 

But  it  is  said  that,  inasmuch  as  the  plain- 
tiff retained  this  stock,  and  went  into  the 
employ  of  the  company  in  the  effort  to  make 
the  stock  valuable  and  his  adventure  profit- 
able by  developing  the  mining  property,  he 
cannot,  the  adventure  failing,  recover  the 
vahie  of  his  stock  upon  the  ground  that  the 
re])resentations    upon    which    he    purchased 


AVOIDAXCE  OF  CONTRACT. 


215 


were  unti'ue.  Undoiihtt'dly  tliis  contention  is 
sound  if  it  be  intended  to  be  limited  to  as- 
serting the  doctrine  that,  after  thus  par- 
ticipating in  the  nianafrenieut  of  tlie  corpo- 
ration, and  holding  stock  souu'  months,  thf 
plaintiff  would  not  be  permitted  to  rescind 
his  contract  with  the  <lefendant:  but  that 
is  uot  the  nature  of  the  present  action;  it 
is  a  suit  upon  the  warranty,  and.  if  he  has 
.<<hown  the  warranty,  he  has  a  clu»ice  of 
remedies,  either  to  rescind  the  contract  or 
to  sue  and  recover  damages  for  the  breach. 

2.  The  defendant  offered  testimony  which 
tended  to  show  that  the  plaintiff,  in  con- 
-strueting  a  mill  which  was  on  the  mining 
property,  had  not  done  the  work  well.  The 
plaintiff',  in  rebuttal,  was  permitted"  to  call 
a.  witness,  who  testified  that  he  was  ac- 
(luainted  with  the  plaintiff,  and  had  occa- 
sion to  know  of  his  capacity  and  ability  as 
a  carpenter  and  joiner,  and,  against  the  ob- 
jection of  defendant,  was  allowed  to  testi- 
fy that  he  considered  him  a  tirst-class  man 
in  every  respect.  This  was  error.  Testi- 
mony that  the  mill  in  question  was  uot  well 
constructed  did  uot  necessarily  involve  the 
question  of  plaintiff's  capacity  or  ability  as 
a  carpenter  or  millwright. 

One  G.  Peden  testified  to  having  seen  the 
plaintiff  intoxicated  while  in  Arkansas.  The 
jjlaintiff.  in  rebuttal,  was  permitted  to  in- 
troduce a  certificate  or  recommend  purport- 
ing to  be  signed  by  Pedeu.  which  was  intro- 
duced and  read  to  the  jury,  as  follows: 
"To  whom  it  may  concern:  Crystal  Springs. 
Arkansas.  February  eighth.  ISSS.  We,  the 
citizens  of  Crystal  Springs.  Arkansas,  hav- 
ing seen  a  letter  written  in  Manistee,  Michi- 
gan, which  states  that  one  S.  W.  Fowler 
of  Manistee,  Michigan,  has  been  circulating 
false  reports  about  Mr.  .T.  D.  Maxted.  for- 
merly of  Manistee.  Michigan,  and  now  of 
Crystal  Springs.  Arkansas,  we  will  say  that, 
if  Mr.  Maxted  has  ever  been  discharged  by 
the  Accident  Ore  Mining  Company,  we  can 
see  no  reason  why.  unless  it  was  a  plan  set 
by  one  S.  W.  Fowler  to  beat  him  out  of  his 
wages,  for  Mr.  Maxted  is  not  a  drinking 
man  in  any  sense  of  the  word,  and  to 
charge  him  thus  is  unjust  and  untrue.  Mr. 
Maxted  has  shown  himself  to  be  a  perfect 
gentleman  ever  since  he  has  been  here,  and 
has  also  proved  himself  capable  of  doing 
any  business  intrusted  to  him;  and  we,  as 
citizens  of  Crystal  Springs.  Arkansas,  in 
justice  to  Mr.  Maxted.  will  and  do  say  that 
the  charge  against  him  by  one  S.  W.  Fowl- 
er is  unjust."  Signed,  among  others,  by  G. 
Peden.  Tliis  paper  was  not  shown  the  wit- 
ness Peden  on  cross-examination,  nor  was 
he  given  any  opportunity  to  explain  it  when 
it  was  (Kfered  for  the  pui-pose  of  contradict- 
ing his  statement  that  he  had  seen  Maxted 
intoxicated.  In  addition  to  the  general  ob- 
jection that  it  was  immaterial  and  incompe- 


tent, it  was  objected  that,  even  if  admissi- 
ble, whatever  related  to  the  drinking  was 
all  that  should  be  read  to  the  jury.  This 
objection  wa.s  overruled,  and  the  letter  read 
in  evidence.  On  a  subsequent  motion  the 
letter  was  stricken  out  because  the  letter  of 
Mr.  Fowler,  referred  to,  was  not  produced. 
It  would  have  been  difficult  to  have  framed 
an  instrument  which  was  better  calculated 
to  prejuilice  the  defendant's  case  than  was 
this.  It  v.as  clearly  not  admissible,  and  we 
cannot  say  that  it  did  not  have  its  effect  in 
prejudicing  the  jury  against  the  defendant. 
It  was  a  direct  attack  upon  his  character 
which  was  libelous  if  untrue.  introdu<ed 
an  issue  wholly  foreign  to  the  case,  and 
which  the  defendant  could  not  be  expected 
to  meet,  and  the  fact  that  it  was  afterwards 
stricken  out  is  not  conclusive  that  the  im- 
pression did  not  remain  with  the  jiuy.  It  is 
incredible  that  the  prnqjose  of  plaintiff's 
counsel  could  have  been  other  than  to  preju- 
dice the  jury. 

One  other  a.ssignment  of  error  only  will 
be  i-eferred  to.  On  the  subject  of  damages 
the  circuit  judge  charged  the  jury:  "If  it 
[the  stock]  was  entirely  worthless,  as  claim- 
ed here.  then,  if  the  plaintiff  recovers  at  all. 
he  will  recover  the  whole  amount  at  your 
hands.  There  can  be  no  recoupment  in  this 
case  of  the  defendant  against  the  plaintiff 
for  any  claim  raised  upon  that  head.  The 
claim  cannot  be  sustained  in  this  suit,  for 
in  fact  there  is  no  basis  for  it  under  the  evi- 
dence." And  again:  "In  case  you  find  for 
the  plaintiff,  it  will  be  for  the  full  amount, 
with  interest  at  six  per  cent.  In  case  you 
find  for  the  defendant,  it  will  be.  "Xo  cause 
of  action."  "  The  proper  rule  for  damages 
would  be  the  diffei-ence  between  the  par 
value  of  the  stock  as  it  was  represented  to 
be  and  what  it  was  worth  in  fact,  and  this 
would  have  reference  to  the  time  when  the 
stock  was  transferred  to  the  plaintiff.  We 
think  the  testimony  in  the  case  failed  to 
show  conclusively  that  the  stock  was  ab- 
solutely of  no  value  at  the  time  this  trans- 
fer was  made,  and  therefore  the  question 
of  its  value  should  have  been  submitted  to 
the  jury.  For  the  errors  pointed  out  the 
judgment  will  be  reversed,  and  a  new  trial 
ordered. 

The  record  contains  ;!4i.'  pages,  indiules  all 
the  orders  made  in  the  ca.se  and  all  the  testi- 
mony, which  was  unnecessary;  and  not  only 
this,  but  the  testimony  is  given  precisely 
as  it  appears  in  the  stenographer's  minutes, 
not  even  omitting  the  certificate  of  the  ste- 
nographer. This  practice  has  been  often 
condemned.  We  think  a  record  of  2<Kt  pages 
at  the  most  would  liave  fairly  presented  all 
the  questions  which  we  have  been  called 
upon  to  consider,  and  the  costs  for  printing 
will  be  limited  to  that  number  of  pages. 
The  other  justices  concurn-d. 


216 


AVOIDANCE  OF  CONTRACT. 


piCARD  V.  Mccormick. 

(11  Mich.  (J8.) 

Supreme  Court  of  Michigan.     Oct.  Term,  18o2. 

H.  J.  Beakes,  for  phiiutiff  iu  error.  A. 
Felch,  for  defeudaiit  in  error. 

CA^^IPBI'^LL,  J.  Mc-Curmick  sued  I'icard 
to  recover  damajj^es  on  account  of  false  rep- 
resi'ntatious  whereby  the  former  was  induced 
to  purcha.se  of  the  latter  watches  and  other 
jeweliy  to  a  large  amount. 

The  declauition  contains  several  different 
counts,  and,  inasmuch  as  it  is  claimed  that 
all,  or  some  of  them,  are  fatally  defective,  it 
becomes  necessary  to  refer  to  them. 

The  lirst  count  avers  tlie  ignoraufe  of  plain- 
tiff concerning  the  value  and  quality  of  the 
articles  sold,  the  defendant's  knowledge  of 
such  ignorance,  he  himself  being  a  skillful 
dealer  in  such  goods,  the  ai^plicatiou  by  de- 
fendant to  ^McCormick  to  induce  him  to  pur- 
<■ha.se,  the  refusal  of  McCormick  to  do  so  ex- 
cept in  reliance  upon  Picards  representations, 
and  a  sale  based  on  fraudulent  representations 
of  the  value  of  the  property,  whereby  tbe 
purchaser  was  damnified. 

The  second  count  is  for  a  breach  of  warranty 
of  value,  by  which  xicard  knowingly,  falsely, 
and  fraudulently  deceived  McCormick. 

The  third  count  is  for  false  representations 
concerning  the  value  and  quantity  of  gold  in 
a  necklace  which  Picard,  knowing  McCoi*- 
mick's  ignorance,  induced  him  to  purchase  by 
such  representations. 

The  fourth  and  fifth  counts  are  framed  like 
the  first,  but  upon  different  representations. 

The  principal  objection  alleged  against  those 
several  counts  (which  is  taken  on  assignment 
of  error,  and  not  by  demurrer)  goes  to  the  ma- 
teriality of  the  frauds  charged.  It  is  claimed 
that  an  allegation  of  value,  although  false, 
cannot  be  made  the  ground  of  an  action. 

It  is  undoubtedly  true  that  value  is  usually 
a  mere  matter  of  opinion;  and  that  a  pur- 
chaser must  expect  that  a  vendor  will  seek  to 
enhance  his  wares,  and  must  disregard  his 
statements  of  their  value.  But,  while  this  is 
generally  the  case,  yet  we  are  aware  of  no 
rule  which  determines  arbitrarily  that  any 
class  of  fraudulent  misrepresentations  can  be 
exempted  from  the  conseciuences  attached  to 
others.  Where  a  pure-baser,  without  negli- 
gence, has  been  induced  by  the  arts  of  a  cheat- 
ing seller  to  rely  upon  material  statements 
which  are  knowingly  false,  and  is  thereby 
damnified,  it  can  make  no  difference  in  what 
resiiect  he  has  b«;n  deceived,  if  the  deceit  was 
material,  and  i-elied  on.  It  is  only  because 
statements  of  value  can  rarely  be  supposed  to 
have  induced  a  purchase  without  negligence 
that  the  authorities  liave  laid  down  the  prin- 
ciple that  they  cannot  usually  avoid  a  bar- 
gain. But  A'aJue  may  frequently  be  made  by 
the  parties  themselves  the  principal  element  in 
a  contract,  and  there  arc  many  cases  whei-e 
articles  possess  a  standard  conmiercial  value, 
in  which  it  is  a  chief  criterion  of  qualitj'  among 


tliose  who  are  not  experts.  It  is  a  matter  of 
every-day  occiu'rence  to  find  various  grades  of 
manufactured  articles  known  more  geneially 
by  tlieir  prices  tlian  by  any  test  of  their  qual- 
ity which  can  be  furnished  by  ordinary  in- 
.'•])ection.  Frauds  are  ca.>ily  committed  by  dis- 
honest dealers,  by  confounding  these  grades, 
and  cannot  be  detected  iu  many  cases  except 
by  persons  of  experience.  In  the  case  before 
us  the  alleged  fraud  consisted  of  false  state- 
ments by  a  jeweler  to  an  unskilled  purchaser 
of  the  value  of  articles  wlilch  none  but  an  ex- 
pert could  bo  reasonably  supposed  to  under- 
stand. The  dealer  knew  of  t!ie  purcliaser's  ig- 
norance, aad  deliberately  and  designedly  avail- 
ed himself  of  it  to  defraud  him.  We  think 
that  it  cannot  be  laid  down  as  a  matter  of  law 
that  value  is  never  a  material  fact,  and  we 
think  the  ciretimstances  of  this  case  illustrate 
the  impiopriety  of  any  such  lule.  They  show 
a  plain  and  aggravated  case  of  cheating.  And 
it  would  be  a  deserved  reproach  to  the  law  if 
it  exempted  any  specific  fraud  from  its  reme- 
dial action,  where  a  fact  is  stated  and  relied 
upon,  whatever  may  be  the  general  difficulty 
of  defrauding  by  means  of  it.  The  same  rea- 
soning will  dispose  of  the  objection  thar  in  the 
second  couut  the  representation.s  are  not  set 
out  as  having  been  relied  upon,  or  as  having 
been  made  in  deliberate  breach  of  confidence. 
If  value  can  be  regarded  in  any  case  as  a  ma- 
terial fact,  then  it  may  be  made  the  subject 
of  a  warranty.  This  count  is  in  the  usual 
form  for  breach  of  a  fraudulent  warranty,  and 
is  therefore  gootl. 

An  objection  was  also  made  that  one  of  the 
counts  averred  damages  less  than  $100.  This 
objection  is  net  tenable.  The  counts  must  al- 
W'ays  be  regarded  in  law  as  separate  claims, 
and,  if  the  aggregate  damages  alleged  in  the 
various  counts  joined  exceed  $100,  the  court 
has  jurisdiction. 

Upon  the  trial,  one  of  the  witnesses,  having 
detailed  the  false  representations  made  by  Pi- 
card  to  McCormick,  concerning  the  watches, 
one  of  which  was  set  with  diamonds  on  the 
outside,  was  asked,  "What  was  said  about  the 
jewels?"  This  Avas  objected  to  because  the 
declaration  alleged  no  representation  about  the 
jewels,  but  the  objection  was  overruled,  and 
the  witness  swore  Picard  said  if  the  watch 
was  smashed  up  the  diauionds  would  be  worth 
.$70.  The  question  was  not  improper.  A 
declaration  would  be  improperly  framed  and 
needlessly  prolix,  if  it  should  set  out  in  terms 
the  whole  of  a  conversation  from  which  a  jury 
would  be  warranted  in  finding  that  fraud  had 
been  practiced.  A  pleading  slKjuld  conUiin  al- 
legations of  fact,  and  not  of  evidence.  The 
inference  from  the  evidence  is  one  of  fact,  and 
not  of  law.  The  plaintiff  was  entitled,  if  not 
required,  to  lay  before  the  jitry  tl]#  whole 
transjiction,  so  that  they  might  determine 
from  all  the  facts  what  might  not  be  so  clear 
from  a  portion  of  them.  The  evidence  was 
proper,  therefore,  as  forming  a  part  of  the 
transaction.  It  was  very  material  as  tend- 
ing to  show  a  resort  to  circumstantial  false- 


AVOIDANCE  OF  CONTRACT. 


217 


hoo<ls,  wliicli  an-,  l).v  coinnion  experience, 
more  claiif;('rous  than  mere  wholesale  asser- 
tions. There  is  no  more  effectual  means  of 
deceiving  than  the  assertion  of  numerous  mi- 
nor facts,  as  evidence  of  a  principal  fact, 
which,  if  true,  they  would  of  necessity  estab- 
lish. 

A  bill  of  sale  was  produced,  w-hieli  the  de- 
fendant endeavored  to  show  was  meant  to 
be  in  the  name  of  one  Jacob  Picard,  and  not 
Isaac  I'icard;  there  being  some  difference  of 
opinion  amonuj  the  witnesses  whether  the  in- 
itial used  was  meant  for  I  or  J.  And,  as 
the  sale  was  charged  as  made  by  Isaac  Pi- 
card,  his  counsel  asked  the  court  to  charge 
the  jury  that  the  bill  of  sale  was  tne  evi- 
dence of  the  contract,  and  could  not  be  con- 
tradicted by  parol  evidence.  This  the  court 
refused,  and  told  the  jury  that,  though  the 
contract  be  in  writing,  if  the  defendant  had 
been  dishonest  in  the  transaction,  the  plain- 
tiff might  disregard  the  writing,  and  sue  di- 
rectly for  the  fraud.  The  charge  was  cor- 
rect. The  fraud  is  the  foundation  of  the  ac- 
tion. Isaac  Picard,  who  perpetrated  it,  was 
responsible  for  it.  If  employed  by  some  one 
else,  it  could  not  exonerate  himself,  although 
it  might  possibly  render  his  principal  liable, 
if  guilty,  civilly,  and  possibly  as  a  party  to  a 
conspiracy.  There  A^as,  however,  nothing  in 
the  case  to  render  such  a  charge  material, 
even  if  it  had  been  incorrect.  The  evidence 
showed  no  contract  except  with  Isaac  Picard. 


A  simple  bill  of  sale  does  not  embody  the 
pieliminarits  or  the  essential  terms  of  the  con- 
tract in  such  a  way  as  to  exclude  parol  evi- 
dence. It  i.s  designed  merely  to  show  the 
transfer  of  title.  If  made  in  the  name  of  J. 
Picard,  instead  of  I.  Picard.  it  was  evidently 
a  very  shallow  trick,  although  defendant 
seems,  from  his  remarks  to  Kosentield,  to 
have  formed  the  idea  that,  if  he  gave  a  bill 
of  sale,  there  could  be  no  after-concern  about 
it.  AVe  are  not  aware  of  any  i-ule  which  de- 
termines, in  the  eye  of  the  law,  any  invariable 
distinction  between  the  English  written  signs 
for  I  and  J;  but,  if  such  a  distinction  were 
entirely  clear,  it  would  not  liave  the  effect 
of  discliargi?ig  a  fraudulent  contractor  who 
resorted  to  it  ac'a  device  for  knavery. 

Exception  was  also  taken  to  the  charge  of 
the  court  upon  the  circumstances  under  which 
a  vendor  becomes  liable  for  misrepresentation. 
We  think  the  nile  laid  down  remarkably 
clear,  and  entirely  correct.  We  also  think 
the  distinction  between  a  sale  and  an  ex- 
change of  property  was  properly  taken.  If 
property  is  taken  at  a  fixed  money  price,  the 
transfer  amounts  to  a  sale,  whether  the  pri(!e 
is  paid  in  cash  or  in  goods.  The  term 
"sale"  is  comprehensive,  and  embraces  aU 
transfers  for  a  price  named,  whether  con- 
fined to  that  class  or  not. 

There  is  no  enor  in  the  proceedings,  and 
the  judgment  must  be  affirmed,  with  costs. 

The  other  justices  concurred. 


21S 


AVOIDANCE  OF  CONTRACT. 


TECK  V.  JEXISON  ct  al. 
(58  N.  W.  312,  9!)  Miih.  32(;.) 
Supreme  Court  of  Miclii«!in.      March  20. 

Error  to  circuit  court,  Kent  county; 
C.  Adsit,  .Tudffe. 

Actiou  by  Arlliur  K.   rocli.  agnins^t   ^ 
Ji>iii.son  and  anotlior  for  the  price  of 
sold    and    delivered.      There    was    judj 
for  defendants,  and  plaintiff  brings  error. 
Armed. 

D.     E.     Corbitt,     for     appellant.     W. 
]Mitcliel,  for  appellees. 


1894. 
Allen 

unian 

goods 

j;inent 

Af- 

AV. 


LONG,  J.  riaintiff  resides  at  Syracuse,  N. 
Y.,  and  is  the  manufacturer  of  a  machine 
called  the  "Peck  Autographic  Cash  Register." 
He  has  a  general  agent  in  this  state  for  the 
sale  of  the  machines,  and  the  general  agent 
also  has  agents'  taking  orders  for  sales.  Some 
time  in  March,  18'.)o.  Mr.  Forte,  one  of  these 
subagents.  called  upon  the  defendants,  who 
keep  a  country  store  in  Ottawa  county,  and 
procured  from  them  the  following  order:  "A. 
R.  Peek,  Cortland,  N.  Y.  Please  ship  to  us  to 
Jenison,  Mich.,  one  Peck's  cash  register, 
same  as  sample  shown.  Cabinet  to  be  oak 
N.  5,  three  rolls  of  paper.  On  fulfillment  of 
the  above,  we  agree  to  pay  you  forty-tive  dol- 
lars (.i;4.j.(X>)  as  follows:  Five  days  after 
shipment  you  to  draw  at  one  day's  sight,  de- 
ducting 5  p.  c.  from  purchase  price.  Register 
to  be  delivered  f.  o.  b.  Cortland,  N.  Y.,  in 
good  working  condition,  and  espial  in  every 
respect  as  sample  shown.  All  paper  rolls 
used  to  be  purchased  of  A.  R.  Peck,  the  cost 
not  to  exceed  twenty -five  cents'  per  roll  for 
No.  3,  and  thirty-five  cents  for  No.  5,  and  in 
quantity  not  less  than  four  rolls  at  one  time. 
In  default  of  any  payment,  you  or  your 
agent  may  take  possession  and  remove  said 
cash  register  Avithout  legal  process,  and  all 
claims  for  damages  arising  from  such  re- 
moval are  hereby  waived.  Tliis  order  is 
given  subject  to  your  approval,  and  it  is  ex- 
pressly agi'eed  that  it  shall  not  be  coimter- 
manded.  Should  there  be  any  failures  to 
accept  s'uch  drafts  or  execute  notes  for  de- 
ferred payments  on  presentation  of  same, 
it  is  agreed  that  the  entire  purchase  price 
shall  at  once  become  due  and  payable.  In 
default  of  any  one  acceptance  or  note,  it  is 
agreed  that  all  the  remaining  acceptances  or 
notes  shall  at  once  become  due  and  payable, 
notwithstanding  anything  in  the  acceptances' 
or  notes  to  the  contrary.  All  claims  for 
verbal  agreements  not  embodied  herein  are 
waived.  It  is  expressly  agreed  that  the 
title  of  .said  cash  register  shall  not  pas's  until 
paid  for  in  full.  Should  the  register  get  out 
of  order  within  two  years  from  date  sold,  you 
to  repair  the  same  gratis,  the  undersigned 
paying  the  express  charges  to  and  from  the 
factory.  Yours,  trul.v,  L.  «&  L.  .Jenison."  The 
machine  was  left  with  the  defendants,   who 


kept  it  for  a  time,  and  tlirn  shtiii)ed  it  to  the 
plaintiff.  This  suit  was  brought  to  recover 
the  value  of  the  machine.  The  defense  set 
up  was  that  the  contract  or  order  for  the 
machine  was  obtained  by  false  and  fraudu- 
lent representations.  The  representations 
made  b.v  the  agent  who  took  tlie  order  were 
that  the  machine  was  the  best  and  cheapest 
cash  register  that  could  be  bought,  that  it 
was  worth  the  price,  and  that  it  was  the  on- 
ly one  that  could  be  bought  on  the  market 
for  that  price,  and  that,  if  the  defendants  did 
not  tind  it  as  he  represented,  they  could  re- 
turn it.  Defendants  knew  nothing  of  the 
quality  or  practical  workings  of  such  ma- 
chines, and  told  the  agent  that  they  would 
take  it  wholly  upon  his  representations.  The 
price  was  to  be  $4.j.  The  representations 
were  made  by  the  authority  of  the  general 
agent  in  this  state  for  the  plaintiff,  and  he 
testiflod  that  he  instructed  the  subagent  who 
made  the  sale  to  represent  to  the  parties  pur- 
chasing that  the  machine  was  actually  worth 
$45,  and  that  that  was  the  only  one  which 
could  be  bought  for  that  price;  and  that  if 
they  would  take  it  and  try  it.  and  it  was  not 
as  represented,  they  might  send  it  back.  It 
was  shown  that  a  machine  of  equal  value 
was  at  that  time  selling  in  the  market  for 
.$20,  and  also  that  this  machine  was  not  worth 
to  exceed  .$5.  The  court  directed  the  jury 
substantially  that  if  they  found  that  these 
representations  were  made,  and  defendants 
relied  upon  them  in  signing  the  order,  and 
that  they  were  untrue,  that  the  defendants 
had  a  right  to  return  the  machine  and  rescind 
the  contract.  The  jury  retiu'ned  a  verdict  for 
defendants. 

It  is  contended  by  counsel  for  plaintiff  that 
the  court  was  in  error  in  these  instructions 
on  the  grounds:  (1)  Because  the  contract 
provided  that  the  order  should  not  be  counter- 
manded, and  also  that  "all  claims  for  verbal 
agreements  not  embodied  herein  are  waived." 
It  is  said  that  the  testimony  given,  and  the 
instructions  of  the  court  thereunder,  changed 
the  terms  of  the  written  contract,  and  there- 
fore the  testimony  was  not  admissible,  and 
the  charge  of  the  com-t  was  erroneous.  The 
testimony  was  not  offered  or  received  for 
tills  purpose,  and  the  court  did  not  submit 
the  question  to  the  jury  upon  that  theory. 
The  claim  Avas  that  the  oi'der  was  procured 
by  fraud,  and,  if  so.  the  defendants  would 
have  the  right  to  rescind  on  that  ground;  but 
it  is  claimed:  (2)  That  the  testimony  did  not 
tend  to  establish  that  fact;  that  the  repre 
sentations  as  to  the  value  of  the  machine 
were  but  the  expression  of  an  opinion;  and 
that  a  vendor  has  the  right  to  praise  his 
goods  in  order  to  make  a  sale,  and  the  state- 
ment of  the  value  is  no  more  than  the  expres- 
sion of  an  opinion.  This  is  undoubtedly  the 
general  rule,  but  in  the  present  case  it  ap- 
pears that  the  defi'udants  knew  nothing  of 
its  value,  and  signed  the  order  relying  wholly 
upon    the   statenu'nt   of    the   agent.     It    was 


AVOIDANCE  OP  CONTKACT. 


219 


the  statement  of  a  fact  Avhicli  the  agent  knew 
to  be  false.  The  case  falls  so  squarely  with- 
in the  rule  laid  down  in  Picard  v.  McCormick, 
11  Mich.  68,  and  Maxted  v.  Fowler,  94  Mich. 
103.  bJ  N.   W.  921,  that  fmiher  suggestions 


are  quite  unnecessary, 
be  affirmed. 


The  judgment  must 


HOOKER,  J.,  did  not  sit.    The  othir  justices 
concurred. 


220 


AVOIDANCE  OF  CONTRACT. 


TOTTEN  T.  BURHANS. 

(51  N.  W.  111!).  01  Midi.  40.").) 
Supreme    Court    of    Michigan.    May    6,    1802. 

Error  to  circuit  court,  Shiawassee  county; 
>Yilllam  Newton,  Judge. 

Trespa.ss  on  the  case  by  Frank  M.  Totton 
against  Daniel  Burhans.  Verdict  and  judtr- 
nient  for  phiintiff.  Defendant  hrin.ss  error. 
Reversed. 

AVatson  &  Chapman,  for  appellant.  S.  F. 
Smith  and  G.  R.  I^yon,  for  appellee. 

MORSE,  C.  J.  The  pl.-iintlff  commenced 
suit  in  the  circuit  court  for  the  county  of 
Shiawassee  against  the  defendant  in  trespass 
oh  the  case,  claiming  damages  for  fraud,  and 
recovered  verdict  and  judgment  for  .$1,237.50. 
'l\)tten  on  the  4th  day  of  February,  1880. 
bcught  out  the  interest  of  Burhaus  in  the 
Owosso  Cigar  &  Candy  Company,  a  copart- 
nership doing  business  at  Owosso.  Adelbert. 
Chase  at  the  time  of  this  purchase  was  a 
partner  with  Burhans,  and  after  the  sale  con- 
tinued as  a  partner  of  Totten.  Chase  had 
but  little  money  in  the  concern,  but  traveled 
for  the  tirm.  and  it  would  seem  put  his  sei'v- 
iees  and  experience  against  the  money  of 
Totten,  as  the  record  shows,  from  plaintiff's 
testimony,  as  well  as  other  evidence,  that 
he  was  an  equal  partner  in  the  profits  of  the 
business.  The  declaration  alleged  the  fj'aud 
to  have  consisted  in  the  representations  of 
Burhans  that  the  business  of  said  Owosso 
Cigar  &  Candy  Company,  for  a  long  time 
prior  to  said  sale  of  his  interest  to  plaintiff, 
had  been  "a  good,  profitable,  paying,  and  re- 
munerative business,"  and  that  Burhans  and 
Chase  had  realized,  and  were  then  receiving, 
large  profits  from  such  business,  and  that 
said  plaintiff  could  not  fail  to  receive  $2,000 
net  profits  per  j^ear  from  sucli  business.  And 
that  certain  accounts  and  demands  belonging 
to  said  company  against  divers  persons,  cus- 
tomers of  said  company,  amounting  to  the 
sum  of  .'RT.OOO.  purchased  by  said  plaintiff 
with  said  business,  were  good  and  collecti- 
ble, and  actually  owing  to  said  firm  or  com- 
pany: that  they  would  be  paid  promptly, 
and  were  all  and  each  of  them  worth  their 
face  value,  dollar  for  dollar.  The  declara- 
tion further  alleged  the  falsity  of  these  rep- 
resentations, and  that,  by  means  of  the  prem- 
ises, the  defendant  defrauded  the  plaintiff, 
so  that  he  not  only  lost  the  money  he  paid  to 
jiurchase  defendant's  interest,  to  wit,  .f2.(KM). 
but  was  deprived  of  his  good  and  fair  reputa- 
tion as  a  business  man,  and  was  damaged  Ij.v 
the  loss  of  the  accounts  not  collectible  and 
his  labor  and  services  for  one  year.  The  tes- 
timony shows  that  Totten  paid  .'?2.(M»0  down, 
wliich  was  about  the  value  of  the  Burhans 
interest  in  the  stock  on  hand,  received  froiti 
Burhans  between  !?(i.(K>!»  and  .$7.01)0  Avorth  of 
accounts,  and  agreed  to  and  did  assume  the 
old    indebtedness   of  the   firm    to  about  the 


sum  of  .$7,0D0.  After  running  the  business 
alxiut  a  year.  itlaintifC  sold  out  to  Burlians, 
to  whom  the  firm  was  indebted  for  indorse- 
ments, losing  his  $2,000,  and  l>eing  indebted 
besides  in  a  large  sum  of  money  on  account 
of  the  business,  which  had  proven  unprohta- 
ble  under  his  management.  The  court  in- 
structed the  .iuiy  that  the  only  damages  that 
the  plaintiff  could  recover  would  be  the  dif- 
ference between  the  accounts  turned  out  to 
him  as  good,  worth  dollar  for  dollar,  and 
what  they  were  actually  worth,  with  6  pel* 
cent,  interest  from  date  of  commencement  of 
suit.  Under  the  declaration  in  the  case,  and 
the  facts  as  shown  by  the  plaintiff's  own  tes- 
timony, the  only  fraud  he  could  legally  com- 
plain of  was  in  relation  to  these  accounts. 
The  evidence  failed  to  show  that  the  busi- 
ness was  unprofitable  before  he  purchased 
defendant's  interest,  and  the  court  rightly 
held  that  he  could  not  recover  for  injuiy  to 
his  business  reputation.  For  his  .$2,000  he 
received  an  eqaivalent  in  the  goods  on  liaud. 

It  follows,  therefoi'e,  that  the  evidence  in 
the  case  should  have  been  confined  to  the 
matter  of  these  accounts,  whether  they  were 
good  and  collectible,  worth  a  hundred  cents 
on  the  dollar  at  the  time  plaintiff  purchased 
them,  what  amount  of  them  were  collected 
b.y  the  plaintiff,  and  whether  or  not  tlie  bal- 
ance could  liave  been  collected  by  due  dili- 
gence on  the  part  of  plaintiff.  But  the  in- 
quiry went  outside  of  this  plain  issue, 
against  the  repeated  objections  of  defend- 
ant's counsel.  It  was  eiTor  to  peraiit  plain- 
tiff to  show  how  he  conducted  the  business 
after  he  purchased  Burhans'  interest,  and 
Burhans'  connection  with  such  business,  ex- 
cept in  so  far  as  the  collection  of  these  ac- 
counts was  concerned.  Also  that  Burhaus 
had  his  office  in  the  building,  and  that  de- 
fendant counseled  with  him  in  the  manage- 
ment of  the  business. 

The  sale  of  the  business  back  again  to 
Burhans,  and  the  details  of  such  transaction, 
had  no  legitimate  place  in  the  case,  and  no 
bearing  upon  any  proper  issue  in  it.  The 
I  admission  of  this  testimony,  which  forms  a 
principal  part  of  the  record  before  us,  was 
evidently  prejudicial  to  defendant. 

It  is  claimed  that  there  was  no  evidence 
tending  to  show  that  any  of  the  accounts 
purchased  by  plaintiff  were  not  good  and  col 
lectible,  lint,  as  all  of  the  testimony  in  the 
case  is  not  returned,  we  are  not  able  to  say 
that  tlie  court  below  erred  in  not  directing  a 
verdict  for  the  defendant.  The  fact  that  all 
the  testimony,  or  the  substance  of  it,  is  not 
returned  upon  any  particular  sul^ject.  dis- 
poses also  of  the  claim  made  in  tliis  court. — 
the  record  is  silent  as  to  its  being  made  in 
the  court  below, — that  one  half  of  these  ac- 
counts belonged  to  Chase,  and  that  plaintiff 
was  allowed  to  recover  the  full  amount  of 
them.  There  is  some  testimony  tending  to 
show  that  Totten  had  bought  out  Chase  be- 
fore  the  resale  to   Burhans.   and   also  that 


AVOIDANCE  OF  CONTKACT. 


221 


Chase  had  but  a  nominal  interest  in  the  part- 
nerslili).  'I'here  was  no  error  in  the  c'har;;e 
of  the  circuit  judK'e. 

The  rule  of  law  is  well  settled  in  this  state 
since  the  case  of  Holcomb  v  Noble,  G9  Mich. 
29(5,  87  N.  W.  497,  that  it  is  immaterial 
whether  a  false  representation  is  made  inno- 
cently or  fraudulently,  if,  by  its  means,  the 
plaintiff  is  injured.  Therefore  it  made  no 
dilference  in  this  ease  whether  Burhans  knew 


that  any  of  these  accounts  were  not  good,  or 
sui)posed  them  to  be  all  good.  If,  in  fact, 
any  of  them  were  not  good,  and  plaintiff  lost 
money  thereby,  then  there  was  a  legal  fraud, 
for  which  defendant  was  responsible.  And 
if  any  of  the  accounts  so  purchased  by  plain- 
tiff had  been  paid,  the  defendant  must  malie 
them  good.  The  judgment  is  reversed,  and 
new  trial  granted,  with  costs  of  this  court 
to  defendant.     The  other  justices  concuiTed. 


222 


AVUIDAXCE  OF  CONTRACT. 


HENRY  V.  VLIET  ct  al. 
(54  N.  W.  122.  30  Noh.  138.) 
Suprenu'  Court  of  Ncl.rjiskn.      Jan.  18.  1803. 
On  ivliraring. 

MAXWELL,  C.  J.  lliis  is  an  action  of 
replevin  to  rooover  the  possession  of  (K)  i)ar- 
rels  of  74  }r;i.soline.  7."»0  cases  100  tlasli  oil,  300 
cases  2-5  150  W.  W.  oil.  of  great  vahie.  The 
answer  of  the  defendant  below  (plaintiff  in 
"Tor)  was  a  general  denial.  On  the  trial 
of  the  cause  the  jtu-y  returned  a  verdict  in 
favor  of  the  (".efendauts  in  error  for  the  prop- 
erty in  dispute,  and  "'that  tlu>  defendant  is 
indebted  to  the  plaintiffs  in  the  sum  of  •$757.- 
52  for  goods  not  foinid."  .Judgment  was 
rendered  f)n  the  verdict. 

The  substantial  facts  in  the  case  are  as  fol- 
lows: One  L.  A.  Stewart,  doing  business  in 
Omaha  as  L.  A.  Stewart  &  Co.,  during  the 
months  of  April,  May,  June,  and  July,  18S7, 
seems  to  have  purchased  goods  from  every 
one  who  woidd  sell  to  him  on  credit.  He 
se(Mns  to  have  had  but  little  property,  and 
less  integrity.  Earh'  in  July  of  that  year  he 
purchased  from  the  plaintiff  l)elow  four  car 
loafls  of  oil,  which  were  to  be  paid  for  in  cash 
on  delivery,  or  by  a  secured  note  or  draft  ac- 
cepted by  some  bank.  Upon  the  arrival  of 
the  property  he  managed  to  obtain  possession 
of  tlie  same  without  either  paying  the  cash 
or  giving  a  sectired  note.  He  th(>reupon  exe- 
cuted a  chattel  mortgage  on  the  same,  togeth- 
er with  other  property,  to  Henry,  to  secure 
the  payment  of  one  note  for  .$5,000,  dated 
April  30,  18S7,  due  90  days  from  the  date 
tliereof;  one  note  for  $5,000.  dated  June  10, 
18S7,  due  ill  90  days  from  the  date  thereof; 
one  note  for  .$2,500,  dated  June  25,  1887,  due 
in  90  daj's  from  the  date  thereof;  and  one 
note  for  $2.-500,  dated  June  22,  1887,  due  90 
days  from  the  date  thereof;  and  also  tliree 
certain  drafts  drawn  by  L.  A.  Stewart  &  Co. 
on  W.  R.  Stewart,  of  Des  Moines,  !owa,  in 
the  aggregate  sum  of  .$4,957.50.  The  notes 
described  in  said  mortgage  (with  the  excep- 
tion of  one  for  .$2,500,  dated  June  25.  1SS7.) 
^^  ere  renewals  of  prior  indebtedness.  $10,000, 
which  was  first  loaned  January  2,  1880.  The 
bills  of  exchange  secured  by  said  chattel 
mortgage  consisted  of  one  draft  di-awn  July 
J 9,  1887,  upon  Will  R.  Stewart,  Jr.,  of  Des 
Moines,  Iowa,  for  $8.50;  one  draft  for  .$2,017.- 
.50.  dated  July  20,  18S7,  upon  Wil  R.  St  -wart, 
.li-. :  one  draft  npf)n  W.  R.  Stewart.  Jr.,  for 
$1.49(1,  dated  July  21.  1887.— aU  of  which  said 
drafts  \A-ere  protested  for  nonacceptance. 
Said  drafts  were  deposited  in  the  Bank  of 
Omaha,  of  which  Andrew  Henry  was  the  sole 
owner,  and  received  as  cash,  and  L.  A.  Stew- 
art &  Co.  were  allowed  to  draw  against  them 
a-s  so  nuich  cash  on  deposit.  At  the  time  of 
the  giving  of  said  mortgage  there  was  in  the 
Bank  of  Omaha  to  the  credit  of  L.  A.  Stewart 


&  Co.  the  sum  of  $274.50.  The  notes  secured 
by  said  mortgage  were  all  signed  by  L.  A. 
Stewait  &  Co.  and  also  by  W.  R.  Stewart. 
Jr.  It  had  been  the  custom  of  W.  R.  Stew- 
art, Jr..  to  honor  the  drafts  of  L.  A.  Stewart 
&;  Co.  upon  him.  It  also  appears  that  on  July 
20,  1887,  W.  R.  Stewart.  Jr..  of  Des  Moines, 
Iowa,  accompanied  by  his  attorney,  Mr.  Dud- 
ley, came  to  Omaha,  and  insisted  upon  L.  A. 
Stewart  &  Co.  securing  the  indebtedness  to 
the  Bank  of  Omaha  upon  which  W.  R.  Stew- 
art, Jr.,  was  liable  as  surety.  A  mortgage 
Avas  therf-upon  prepared  by  L.  A.  Slewart  & 
Co.  conveying  the  stock  of  goods  and  ac- 
counts of  the  said  L.  A.  Stewart  &  Co.,  in- 
cluding the  goods  in  controversy  in  this  ac- 
ilon;  and  W.  R.  Morris,  attorney  for  L.  A. 
Stewart  &  Co..  W.  R.  Stewart,  Jr.,  and  his 
attorney,  Mr.  Dudley,  on  the  morning  of  the 
22d  of  July,  1887,  presented  the  same  to 
Henry,  and  demanded  that,  in  consideration 
of  the  entire  indebtedness  to  said  Andrew 
Henry  being  sectired,  the  said  Andrew  Henry 
should  release  the  said  W.  R.  Stewart,  Jr.. 
from  liability  by  reason  of  said  notes.  The 
mortgage  was  thereupon  received  by  Henry. 
There  is  a  conflict  of  testimony  on  this 
|)oint;  the  evidence  of  W.  R.  ^lorris  and  W. 
R.  Stewart,  Jr.,  being  that  said  W.  R  Stew- 
ai-t,  Jr.,  was  absolutely  released  from  his 
liability  upon  said  notes;  and  the  testimony 
of  Pklward  J.  Cornish  was  that  Andrew 
Henry  agreed,  as  part  consideration  of  said 
mortgage,  not  to  press  W.  R.  Stewart,  Jr.. 
upon  the  notes,  or  to  bring  suit  or  in  any 
manner  to  make  claim  for  paym(»nt  upon  th' 
notes  until  the  mortgaged  property  should 
be  entirely  exhausted;  and  this  we  a/e 
( ouvinced  is  the  truth  in  regard  to  the  trans- 
■•iction.  W.  R.  Stewart,  Jr.,  therefore,  is  still 
liable  on  those  obligations.  It  is  unnecessary 
for  us  to  review  the  various  assignments  of 
error  at  length. 

The  conceded  facts  show  that  the  property 
in  question  was  sold  for  cash  on  receipt  or 
seciu'ed  notes;  that  .Stewart  obtained  the 
property  without  paying  foi"  it;  that  he  soon 
afterwards  exec-uted  the  mortgage  in  ques- 
lion;  that  Henry  knew,  or  had  the  means  of 
knowing,  that  the  property  in  question  had 
not  been  paid  for.  and  in  no  sense  is  he  a 
Ijona  fide  purchaser.  The  same  is  tnie  of 
W.  R.  Stewart,  ,Ir.  As  against  these  parties, 
therefore,  the  owner  of  the  goods  had  a  right 
to  reclaim  them.  Some  reflectif)ns  are  in.ide 
upon  the  plaintiff  in  error  in  the  defendants 
in  -n-ror's  brief,  but  there  is  no  ground  for 
such  insinuations,  as  he  seems  to  have  done 
nothing  inconsistent  with  fairnes;  anl  int;»g- 
lify;  but  the  claims  of  the  defendants  in  error 
are  superior  to  his.  It  follows  that  the  judg- 
ment is  right,  and  that  the  opinion  in  this 
case  on  the  former  hearing,  which  is  reported 
in  33  Neb.  1.30,  49  N.  W.  Rep.  1107,  should 
be  overruled.  The  .judgment  of  the  district 
court  is  affirmed.    The  other  judges  coucm;. 


AVOIDANCE  OF  CONTRACT. 


223 


POTTER  et  Jil.  v.  LEE. 
(53  N.  W.  1047.  94  Mich.  140.) 

Supreme  Coiut  of  Michigan.    Dec.  22,  1892. 

Error  to  circuit  court,  Wayne  county; 
Cornelius  J.  Rcilly,  Judiji.'. 

Action  by  G^^orge  N.  Poner  and  otliers,  co- 
partners, as  the  I'otterfield  Clieese  Factory, 
against  Gilbert  W.  Lee,  to  recover  llie  value 
of  cheese  sold  defendaiit.  From  a  .judgment 
for  plaintiffs,  defendant  ai)peals.    AtHrmed. 

Charles  W.  Casgrain  and  Chai-les  S.  Mc- 
Donald, for  appellant.  Philip  T.  Van  Zile 
and  Frank  E.  K()bst)n,  for  appellees. 

LONG.  J.  Plaintiffs  bi-ought  assumpsit  in 
the  Wayne  circuit  court  on  the  common 
counts.  In  their  bill  of  particulars  they  claim- 
ed for  the  price  and  \alue  of  IGO  cheeses, 
weighing  7,2.j3  jiounds,  at  1^2  cents  per  pound, 
amounting  to  .i;.'>4o.98.  Defendant  gave  notice 
under  his  plea  of  rhe  general  issue  that  the 
plaintilfs  falsely  and  fraudulently  represented 
that  the  cheeses  were  good  and  merchantable, 
were  nor  strong,  and  ^^ould  not  crumble  when 
cut;  that  between  18  and  20  only  were  made 
during  the  month  of  .Inly,  and  the  balance 
wei'e  made  during  August  of  that  year,  and 
that  the  entire  lot  was  equal,  if  not  superior, 
to  the  samples  which  were  exhibited;  that  he 
(the  defendant)  relied  upon  such  warranty  in 
making  tlie  purchase;  that  the  same  were 
not  equal  to  the  samples,  and  that  such  rep- 
resentations were  false,  and  the  cheeses  were 
of  an  inferior  (juality;  were  made  from  infe- 
rior ingredients;  were  strong,  and  would 
crumble  when  cut;  were  immerchantable, 
and  of  no  value;  and  that  he  sustained  loss 
thereon,  and  to  his  business,  etc.,  which  he 
would  recou[)  on  the  trial.  The  case  was  tried 
before  a  jury,  and  the  i)laiutifrs  had  verdict 
and  judgment  for  $.")8".(>().  Defendant  brings 
error.  On  the  trial  the  plaintiffs  pi-oduced  as 
a  witness  John  Potter,  who  was  the  agent 
of  the  plaintitJs  in  making  the  sale  to  the  de- 
fendant. His  version  of  the  sale  and  what 
the  contract  was  is  that  on  the  24th  day  of 
September.  1890.  he  called  upon  the  defendant 
at  his  place  of  business  in  Detroit,  and  en- 
deavored to  sell  hin.  a  quantity  of  cheese, 
which  he  had  at  the  Detroit,  (irand  Haven  & 
Milwaukee  depot  in  Detroit.  He  did  not  sell 
them  on  the  first  visit  to  defendant.  He  called 
upon  others,  and  on  the  next  day  made  a  sale 
to  the  defendant.  He  took  lo  cheeses  as  sam- 
ples to  defendant's  stoiv.  Three  or  four  were 
taken  into  the  store,  and  examined  by  the  de- 
fendant with  a  trier.  Defendant  asked  what 
he  wanted  for  them,  and  he  said  8  cents.  De- 
fendant would  not  pay  that  price,  and  offered 
~V2  cents,  and  the  bargain  Avas  closed  at  that 
price.  The  cheeses  were  each  marked  i)lainly 
on  the  outside  with  the  date  they  were  made. 
Mr.  Potter  testified  that  no  representations 
were  made  as  to  the  cheeses  being  good  and 
marketable,  or  that  those  at  the  depot  were 
as  good  as  the  samples,  but  that  he  Jtated  that 
thev  were  made  in  .July  and  August.    He  also 


testiiied  that  in  st'le<-ting  he  samples  he  took 
some  of  July  and  some  of  August  make,  and 
without  an  effort  to  select  the  best.  The  de- 
fendant testified  that  he  tried  three  of  the 
cheeses  with  a  trier,  and  found  them  good. 
He  asked  how  many  of  the  whole  lot  were 
made  in  July,  and  Potter  answered  1."j  or  20, 
and  the  rest  in  August.  After  examining^ 
the  tliree.  he  asked  Potter  if  the  cheese  would 
crumble  when  cut;  if  they  would,  he  would 
not  give  a  cent  per  pound.  Potter  said  other 
merchants  at  Potterfield  had  used  them  with 
perfect  satisfaction.  That  he  then  .said  to 
Potter:  '•  'If  that  lot  of  cheese  is  as  you  rep- 
resent it,  and  will  not  crumble,  and  are  as. 
good  as  these  three  samples  I  will  take  it 
all,  and  pay  you  seven  and  a  half  cents  per 
pound  for  it."  Potter  said  he  would  take  that 
price,  and  wanted  a  check  for  the  amount.  I 
told  him:  'That  may  be  all  right;  we  have 
plenty  of  money  to  pay  it,  but  we  don't  pay 
quite  as  proiupt  as  that.  You  are  a  stranger 
to  me,  and  I  have  seen  only  ten  boxes  of  these 
cheese,  and  I  don't  know  what  is  in  the  car. 
If  in  the  course  of  ten  days  we  find  this  cheese 
as  you  represent  it.  we  will  pay  for  thenu 
taking  one  per  cent.,  which  is  customarj'.' 
Mr.  Potter  then  left  for  home."  The  last  part 
of  this  arrangement  is  substantially  agreed  to- 
by Mr.  Potter.  He  says  that  defendant  want- 
ed I  per  cent,  oft',  or  take  30  days  to  pay  it  in. 
and  he  gave  him  the  30-days  time.  Nothing 
has  ever  been  paid.  Defendant  took  the 
cheeses  from  the  depot,  sold  some,  and  says 
that  in  less  than  10  days  parties  to  whom  he 
shipped  some  of  them  refuse:!  to  pay,  and 
wrote  letters  rejecting  them.  He  introduced 
testimony  tending  to  show  that  he  attempted 
to  make  .sales;  that  the  cheeses  wotild  crumble 
when  cut,  and  come  back  upon  his  hands, 
as  they  were  not  equal  to  the  sample;  and 
that  it  had  injured  his  business  to  a  great 
extent.  He  testified  further  that  he  wrote  a 
letter  to  the  plaintiffs  on  October  21st,  which 
was  the  first  notification  he  gave  them  of  the 
quality  or  condition  of  the  cheeses,  and  the 
first  refusal  to  i)ay  for  them.  He  states  in  his 
letter  that  the  1-3  cheeses  shown  as  samples 
were  readily  sold,  and  that  no  fault  was 
found  with  them;  but  claim  is  made  that  some 
40  were  shipped  to  Mt.  Clemens,  and  all  but 
5  or  (!  returned;  that  others  were  afterwards 
rettirned  by  parlies  to  whom  he  had  shipped 
them.  Plaintiffs  were  asked  to  take  the  bal- 
ance away.  Much  testimony  was  given  which 
it  is  not  neces.sary  to  allude  to.  The  errors  re- 
lied upon  relate  principally  to  the  refusal  of 
the  court  to  give  certain  of  defendant's  n-- 
quests  to  charge,  and  to  the  charge  as  given. 
Claim  is  also  made  that  the  court  was  in  error 
in  refusing  to  permit  the  defendant  to  show 
the  loss  of  profits  on  resale  caused  by  breach 
of  warranty,  and  the  effect  sucii  breach  had 
upon  his  business  and  trade.  The  court  chai"- 
ged  the  jury  that  if  they  found  the  defendant 
remaiiu'd  silent  for  some  20  days  after  the 
clieeses  were  ptuchased.  without  complaining 
that  those  delivered  were  not  such  in  quality 


224 


AVOIDANCE  OF  CONTRACT. 


as  those  purchased,  and  if  they  found  that 
cheeses  were  perishable  property,  defendant 
could  not.  after  that  lapse  of  time,  rescind 
his  contract;  and  their  verdict  must  be  for 
the  plaintiffs  for  the  price  the  cheeses  were 
sold  for;  and,  further,  the  court  directed  the 
Jury  that  the  failure  to  notify  the  plaintiffs 
must  l>e  considered  as  an  acceptance  of  the 
property   at   the   price  agreed  upon. 

We  need  not  state  the  several  requests  to 
char,i,'e,  as,  from  the  view  we  take  of  the  case, 
the  court,  under  the  testimony  of  the  defend- 
ant himself,  should  have  directed  the  verdict 
in  favor  of  the  plaintiffs.  Defendant  admits 
that  he  said  to  Mr.  Potter,  plaintiffs'  agent: 
"You  are  a  stranger  to  me,  and  I  have  seen 
only  ten  boxes  of  these  cheese,  and  I  don't 
know  what  is  in  the  car.  If  in  the  course  of 
ten  days  we  find  this  cheese  as  you  represent 
it,  we  will  pay  for  them."  The  arrangement, 
in  effect,  was  that  he  was  to  have  10  days 
to  examine  the  cheeses,  and  if  found  as  rep- 
resented, he  was  to  pay  for  them;  and,  if 
not  found  as  represented,  he  might  return 
them.  Potter  does  not  dispute  this  arrange- 
ment. It  is  therefore  evident,  even  if  a  war- 
ranty was  made  by  Potter  as  to  the  quality 
of  the  cheese  in  the  car,  and  not  examined  at 
the  time  by  the  defendant,  that  the  defend- 
ant did  not  rely  upon  it,  but  preferred  to 
make  an  examination  for  himself,  and  was 
to  have  the  10  days  to  do  it  in.  If  he  did 
not  make  such  examination,  it  was  his  own 
fault.  He  says  the  cheeses  were  brought  to 
his  store.  He  had  therefore  every  oppor- 
tunity to  make  an  examination.  He  was 
told  by  Mr.  Potter  that  they  were  made  in 
.Tuly  and  August,  but  claims  that  Potter  told 
him  that  only  1.5  or  20  were  made  in  .July. 
and  the  rest  in  August.  When  they  Avere 
lirought  to  the  store,  he  could  readily  see 
what  quantity  was  made  in  each  month 
from  the  marks  upon  the  boxes.     He  claims 


that  complaint  was  made  of  some  that  he 
sold  even  before  the  10  days  elapsed,  and 
yet  he  gave  the  plaintiffs  no  notice  of  these 
facts  for  26  days  after  the  purchase,  know- 
ing, as  it  is  shown,  that  the  cheeses  were 
perishable  property.  He  continued  selling 
right  along  after  the  10  days  elapsed  and 
up  to  the  time  he  finally  refused  payment. 
It  appears  that  there  was  no  contract  of 
warranty  ui)on  which  he  relied,  but  rather 
an  agreement  for  10  days'  time  to  examine 
and  determine  whether  or  not  he  would  keep 
them.  He  failed  ro  return  them  within  the 
10  days,  and,  under  the  admitted  facts,  he 
iniist  be  considered  as  having  accepted  them, 
and  cannot  be  heard  to  set  up  the  defense 
of  warranty  and  breach.  Farrington  v. 
Smith,  77  Mich.  550,  43  N.  iv.  927;  Childs 
V.  O'Donnell,  84  Mich.  533,  47  N.  W.  1108; 
Manufacturing  Co.  v.  Bangs  (Minn.)  44  N. 
W.  671;  Ilosenfield  v.  Swenson  (Minn.)  47 
N.  W.  718.  In  Reed  v.  Randall,  29  N.  Y. 
363,  the  court,  in  speaking  of  an  article 
found  to  be  unmerchantable,  said:  "The  lat- 
ter [the  vendee]  is  not  bound  to  receive  and 
pay  for  a  thing  that  he  has  not  agreed  to 
purchase;  but.  if  the  thing  purchased  is 
found  on  examination  to  be  unsound,  or  not 
to  answer  the  oi'der  given  for  it,  he  must  im- 
mediately return  it  to  the  vendor,  or  give 
him  notice  to  take  it  back,  and  thereby  re- 
scind the  contract,  or  he  will  be  presumed 
to  have  acquiesced  in  its  quality."  In  the 
present  case. the  defendant  admits  that  he 
had  some  of  the  cheese  returned  within  10 
days  after  its  purchase,  yet  he  kept  on  sell- 
ing for  16  days  thereafter,  without  notice 
to  the  seller.  In  this  view  of  the  case,  what- 
ever technical  errors  may  have  been  com- 
mitted on  the  trial  are  of  no  importance,  as 
the  right  result  has  been  reached.  .Tudg- 
ment  is  affirmed,  with  costs.  The  other  jus- 
tices concurred. 


AVOIDA.NX'E  OF  CONTllACT. 


221 


WILSOX  V.  NEW  MXITKD  STATES  CAT- 
TLE-KAX'CII    CO..    Liinitcd. 

(20  C.  C.  A.  244,  T^  Vv\.  ll!)4.) 

Circuit  Court  of  Appenls.  lOif^lith  Circuit. 
March  30,    ISIX!. 

In  error  to   the  circuit   court  of  tlie   United 
States  for  the  district  of  Colorado. 

At  some  time  in  the  early  part  of  1SS4  tlie 
New  United  States  Cattle-Kancli  Company. 
Limited,  a  corporation,  and  the  defendant  in 
error  herein,  agreed  to  purchase  of  \\  miam  .J. 
Wilson,  the  plaintiff  in  eri'or,  tlie  Circle  ranch, 
which  was  locatal  on  the  Kei)ublican  river 
and  some  of  its  tributaries  in  the  states  of 
Nebraska,  Colorado,  and  Kansas,  and  6,000 
liead  of  cattle  j?i"-iziny  thereon,  and  to  pay 
therefor  about  !i;;JOO,(M)U  in  money  and  some 
stock  of  the  corporation.  By  this  contract, 
and  its  various  moditications,  the  plaintiff  in 
error  covenanted  to  convey  to  the  vendee  a 
gwMi  title  to  3,0(MJ  acres  of  land,  and  to  de- 
liver to  it  <5.0(>0  head  of  cattle.  Tlie  vendee 
paid  .^tW^.S.lo  of  tlie  purchase  price,  took  pos- 
session of  the  rancli  and  of  some  of  the  cattle, 
and  jrave  a  bond  and  niortj^afjes  upon  the  cat- 
tle and  the  laud  to  secure  the  payment  of  the 
balance  of  the  price.  The  vendor  made  a 
bill  of  sale  of  the  cattle,  and  a  deed  of  453.80 
acres  of  the  land  to  the  vendee,  and  also  gave 
to  it  a  bond  to  convey  a  good  title  to  the  re- 
mainder of  the  3,000  acres  of  laud.  All  these 
papers  were  deposited  with  a  bank  in  the 
eity  of  Denver,  to  be  delivered  to  the  vendee 
if  it  paid  the  balance  of  the  purchase  price 
according  to  their  terms,  and  to  be  delivered 
to  the  vendor  if  the  vendee  failed  so  to  do. 
It  was  also  agreed  that  the  moneys  realized 
from  the  sales  of  the  cattle  meanwhile  should 
be  applied  in  part  payment  of  tlie  purchase 
price.  On  the  22d  day  of  July,  18S.j,  the 
vendor  entered  upon  this  ranch,  took  posses- 
sion of  the  cattle  and  personal  property  there- 
on, and  in  the  month  of  September  sold  them 
under  the  chattel  mortgage  given  by  the  ven- 
dee for  a  default  in  the  payment  of  an  over- 
due installment  of  the  purchase  price.  There- 
upon the  cattle  company  brought  an  action 
against  the  i)laintift'  in  error  in  the  court  be- 
low for  .$2.">t».0iM».  It  alleged  in  its  complaint 
that  the  plaintiff  in  error  had  by  false  and 
fraudulent  representations  as  to  the  number 
and  character  of  the  cattle,  and  as  to  his  title 
to  the  3,0<tO  acres  of  land,  and  as  to  the  quan- 
tity of  other  land  to  which  he  had  the  right 
of  possession,  and  as  to  the  previous  sales 
of  cattle  from  this  ranch,  and  as  to  various 
other  matters  connected  with  the  transaction, 
induced  it  to  malce  the  contract  of  puirhase 
and  the  various  modifications  thereof,  and  to 
pay  that  portion  of  the  purchase  price  which 
it  had  paid.  It  also  alleged  that  the  plaintitf 
ia  error  had  made  covenants  which  he  had 
not  kept,  and  warranties  which  he  had  bro- 
ken. After  setting  forth  tuese  various  false 
representations,  which  the  defendant  in  error 
averred  had   induced   it   to  make  the  contract 

VAN  ZILE  SEL.CAS.SALES — 15 


of  purchase,  and  the  various  covenants  and 
warranties  which  it  alleged  the  plaintiff  in 
error  had  made  and  broken,  it  closed  tlie  state- 
ment of  Its  cause  of  action  with  these  two  al- 
legations: First,  it  alleged  that  it  did  not  as- 
certain until  after  the  llJth  day  of  September, 
1S8.J,  on  wliich  day  tlie  personal  property  was 
sold  under  the  chattel  mortgage,  the  frauds 
j  and  tiicks  practiced  uiion  It  by  the  vendor  in 
i  counting  and  delivering  the  cattle,  and  tlut 
immediately  thereafter,  on  account  of  short- 
j  ages  and  violations  of  the  agrtn^ment,  on  ac- 
i  count  of  the  substantial  failure  of  the  vendor 
to  carry  out  his  contract,  on  account  of  the 
entire  fallur?  of  said  transaction,  and  on  ac 
count  of  the  deceit  and  fraud  of  the  defend- 
ant, and  the  failure  of  the  consideration  which 
induced  it  to  enter  into  the  contract,  it  re- 
nounced the  said  contract  of  purchase,  and 
demanded  repayment  of  the  moneys  it  had 
laid  out  and  expendal,  which,  it  alleged, 
amounted  to  .$2.jO.O(JO;  second,  it  alleged  that, 
at  all  times  after  the  making  of  the  contract 
and  of  the  modifications  thereof,  ir  had  been 
willing  and  had  offered  to  carry  out  and  per- 
form its  part  thereof,  upon  the  performanc-e 
by  the  plaintiff  in  error  of  his  promises  and 
undertakings  contained  therein,  but  tlwt  he 
had  utterly  failed  and  neglected  to  perform 
the  contract  on  his  part,  so  that  tlie  considera- 
tions which  lnduce<l  the  plaintiff  to  enter  into 
it  had  utterly  failed,  and  tlie  objects  and  pur- 
poses to  be  attained  thereby  were  completely 
destroyed,  and  great  loss  and  damage  was  in- 
flicted upon  it  by  the  fraud  and  deceit  of  the 
defendant,  and  by  his  failure  to  perform  his 
contracts  and  undertakings,  and  to  make  good 
his  representations  and  statements.  These  al- 
legations are  followed  in  the  complaint  by  a 
prayer  for  .$2.30,0<JO,  and  interest  from  Sep- 
tember 10,  188.3.  Issues  wf>re  joined  upon  the 
averments  of  this  complaint,  and  upon  their 
trial  the  juiy  returned  a  verdict  against  the 
plaintiff  in  error  for  $."»0.000.  It  is  the  judg- 
ment upon  this  verdict  that  is  attacked  by 
this  writ  of  error. 

Chas.  S.  Thomas  (W.  H.  Bryant  was  with 
him  on  the  brief),  for  plaintiff  in  error.  Chas. 
J.  Hughes,  Jr.  (Tyson  S.  Dines  was  with  him 
on  the  brief),  for  defendant  in  error. 

Before  CALDWELL.  SANBOK.N,  and 
THAYER,  Circuit  .ludges. 

SAXBOKN,  Circuit  Judge,  after  stating  the 
facts  as  above,  delivered  the  opinion  of  the 
court. 

The  futile  attempt  of  the  defendant  in  er- 
ror to  maintain  an  action  for  affirmance,  and 
an  action  for  rescission  of  its  contract  of 
purchase,  upon  the  facts  pleaded  in  its  com- 
plaint, has  resulted  in  such  inextricatile  con- 
fusion of  the  rules  of  hiAV  applicable  to  the 
trial  of  this  case  that  the  judgment  below 
must  be  reversed.  When  a  vendee  ascer- 
tains that  he  has  been  induced  to  make  a 
couti'act  of  purchase  by  the  framhilent  mis- 
representations   of    his    vendor,     he    has    a 


216 


AN'OIDANCE  OF  CONTRACT, 


choice  of  remcdios.  He  may  resciud  the  con- 
tract, restore  what  he  has  received,  and  re- 
cover back  what  he  lias  paid,  or  he  may  af- 
tirm  tlie  contract,  and  recover  the  damages 
he  lias  sustained  by  the  fraud.  He  cannot, 
however,  do  both.  It  is  as  ditficuit  a  feat  to 
maintain  a  cause  of  action  for  the  considera- 
tion paid  for  the  purchase  on  the  ground  of 
rescission,  and  one  for  damages  for  the 
fraud  which  induced  it,  and  for  a  breach  of 
the  contract  of  purchase  itself,  in  the  same 
action,  as  it  is  to  ride  at  the  same  time  two 
horses  that  are  traveling  in  opposite  direc- 
tions. Upon  a  rescission  of  a  contract  of 
purchase,  the  measure  of  damages  is  the  con- 
sideration paid  and  the  moneys  naturally  ex- 
l)ciuU'd  on  account  of  the  purchase  before  the 
fraud  was  discovered.  Upon  an  action  for 
damages  for  the  deceit  and  fraud  which  in- 
duced the  purchase,  the  measure  of  damages 
is  what  the  vendee  has  lost.  It  is  the  differ- 
ence between  that  which  he  had  before,  and 
that  which  he  had  after,  the  contract  of 
purchase  was  made.  Smith  v.  BoUes,  132  U. 
S.  125,  10  Sup.  Ct.  39;  Reynolds  v.  Franklin, 
44  Minn.  30,  40  N.  W.  139.  Upon  an  action 
for  a  breach  of  the  covenants  and  warran- 
ties contained  in  the  contract  of  purchase, 
the  measure  of  damages  is  the  difference  in 
value  between  the  property  actually  received, 
and  its  value  as  it  would  have  been  if  the 
warranties  and  covenants  had  not  been  bro- 
ken. The  two  causes  of  action  last  men- 
tioned are  consistent  with  each  other,  and 
may  be  maintained  together;  but  each  of 
them  is  inconsistent  with  the  cause  of  ac- 
tion for  rescission,  and  neither  of  them  can 
be  maintained  at  the  same  time  with  that 
cause  of  action.  One  who  has  been  induced 
by  fraud  to  make  a  disadvantageous  con- 
tract of  purchase  may  attiim  the  contract, 
and  sue  for  its  breach  by  the  vendor,  and  at 
the  same  time  may  recover  of  him  the  dam- 
ages which  resulted  from  the  fraud  which  in- 
duced the  contract;  but  he  cannot  recover  for 
a  breach  of  the  contract,  and  for  the  fraud 
which  induced  it,  and  at  the  same  time  recov- 
er the  consideration  which  he  paid  for  it.  He 
cannot  have  the  benefit  of  the  contract 
which  he  purchased  with  the  consideration, 
and  also  have  the  consideration  itself.  The 
court  below  perceived  this  dilemma,  and.  in 
opening  its  charge  to  the  jury,  it  told  them 
that  the  defendant  in  error  sought  to  recover 
on  either  of  three  grounds:  First,  on  the 
ground  of  deceit;  second,  on  the  ground  of  a 
breach  of  express  warranties;  and,  third,  on 
the  groind  of  a  rescission  of  the  contract,— 
but  that  they  need  not  consider  the  latter 
ground,  except  to  ascertain  whether  or  not 
the  whole  consideration  to  the  plaintiff  fail- 
ed on  account  of  the  fraudulent  acts  and 
practices  of  the  defendant.  The  court  then 
attempted  to  keep  these  three  grounds  of  re- 
covery distinct,  and  it  charged  the  jury  that, 
if  they  found  that  the  contract  and  its  mod- 
ifications were  induced  by  deceit,  the  de- 
fendant   in    error    might    recover   the    proper 


measure  of  damages  for  that  fraud,  and  that 
if  they  found  no  deceit,  but  found  that  there 
was  a  breach  of  express  warranties,  the  de- 
fendant in  error  might  recover  damages  on 
that  ground,  and  that  if  there  was  an  entire 
failure  of  consideration,  as  there  would  be  in 
case  of  rescission,  the  defendant  in  error 
might  recover  all  its  expenditures  on  account 
of  the  contract.  This  attempt,  however,  prov- 
ed futile.  The  different  measures  of  dam- 
ages applicable  to  the  three  causes  of  action 
became  inextricably  confused  before  the 
charge  closed;  and  the  court  advised  the  jury, 
among  other  things,  that  if  they  found  that 
through  the  failure  of  the  plaintiff"  in  error 
to  fulfill  his  warranties,  and  the  retaking 
of  the  property  by  the  plaintiff'  in  error  un- 
der his  chattel  mortgage,  there  was  an  en- 
tire failure  of  consideration  to  the  vendee, 
they  might  give  to  the  cattle  company  a  ver- 
dict for  the  moneys  it  had  paid  to  the  ven- 
dor with  interest  from  September  19,  18S.5, 
and  for  all  the  expenses  it  had  paid  on  ac- 
count of  the  purchase.  In  other  words,  the 
court  charged  that  the  jury  might  give  the 
same  damages  for  the  breach  of  the  war- 
ranties in  the  contract  that  they  might  have 
given  in  case  of  the  rescission  of  the  con- 
tract. If  we  apply  this  portion  of  the  charge 
of  the  court  to  a  single  warranty,  its  error 
is  apparent.  One  of  the  guaranties  contain- 
ed in  the  contract  was  that  there  were  (j,000 
cattle  on  the  ranch,  and  that  the  vendor 
would  gather  and  deliver  to  the  vendee  5,- 
400  cattle  of  all  ages  during  the  season  of 
1884.  The  breach  of  this  guaranty  alleged 
in  the  complaint  was  that  there  were  not 
more  than  3,000  cattle  in  the  herd  at  the 
time  the  contract  was  made,  and  that  the 
vendor  did  not  deliver  during  the  season  of 
1884  more  than  4,000  cattle  of  all  ages,  it  is 
obvious  that  the  measure  of  damages  for  this 
breach  was  the  difference  in  value  between 
the  herd  as  it  was  and  as  it  was  warranted 
to  be,  and  not  the  consideration  paid  for,  nor 
the  expenses  paid  on  account  of,  the  con- 
tract. Nor  could  the  fact  that  the  vendor 
some  months  later  seiz.'d  the  cattle  then 
upon  the  ranch,  under  an  alleged  default  in 
the  mortgage  given  to  secure  the  payment 
of  the  balance  of  the  purchase  money,  change 
the  measure  of  damages  upon  the  warranties, 
or  substitute  for  it  the  measure  of  recoveiy 
allowed  upon  a  rescission  of  the  contract. 

The  court  fell  into  another  error  in  its 
treatment  of  the  warranties  alleged  in  the 
complaint.     Jt  charged  the  jury  as  follows: 

"You  may  take  into  consideration  all  the 
facts  and  circumstances,  in  determining 
what,  if  any,  warranties  defendant  made,  or 
caused  to  be  made;  statements  made  by  the 
defendant,  or  caused  to  be  made,  if  any,  by 
him,  not  made  as  mere  matters  of  opinion  or 
belief,  but  attirmations  of  existing  facts  as 
facts,  for  the  purpose  of  assuring  the  plain- 
tiff' or  its  agents,  or  both,  of  the  truth  of  the 
facts  attirmed.  and  inducing  the  plaintiff'  to 
make  the  purchase  of  the  ranch  and  property 


AVUIDANCE  OF  CONTRACT. 


227 


in  qiiostiou;  aud  such  stateuieuts,  if  auy,  re- 
lied ou  by  tlie  plaintiff  and  its  agents,  or  ei- 
tbei%  in  nmkinji  said  purcliase,  or  entering  in- 
to said  contract,  or  acting  in  respect  thereto, 
may  antliorizo  you  in  tinding  an  express  war- 
ranty, if  you  tlilnk  it  ought  to  he  found  from 
the  evidence  and  all  the  circumstances  of  the 
case." 

Again,  it  charged  the  jury  with  reference 
to  a  representation  that  there  were  800  beef 
cattle  in  the  herd,  which  was  made  before 
any  of  the  written  contracts  were  signed,  as 
follows: 

"The  court  charges  the  jury  that  if  they 
find  from  the  evidence  that  it  was  represent- 
ed by  the  said  defendant,  or  his  agent,  that 
there  were  in  said  herd  eight  hundred  beef 
cattle  ready  for  the  market,  that  this  was 
a  material  representation,  for  the  truth  of 
which  the  said  defendant  was  responsible, 
and  that,  if  said  cattle  were  not  there  as 
I'epresented.  then  the  said  plaintiff  had  a 
right  to  a  deduction  from  the  contract  price, 
and  from  the  first  payment  thereon  of  the 
value  of  the  cattle  which  were  not  there 
according  to  said  representation,  and  the 
said  defendant  was  under  obligation  to 
make  reduction  therefor;  and  this  although 
there  may  be  no  special  mention  or  refer- 
ence in  the  contract  itself  to  the  number  of 
the  said  cattle,  for  the  reason  that  the  said 
plaintiff  had  a  right  to  rely  upon  the  state- 
ment and  declaration  and  representation 
made  bj-  and  for  the  said  defendant  as  to 
their  existence  and  presence  in  said  herd." 

These  portions  of  the  charge  were  erro- 
neous and  misleading  in  the  case  now  be- 
fore us.  It  may  be  that  some  portions  of 
them  could  be  sustained  in  a  case  in  which 
the  parties  to  the  sale  had  not  reduced  their 
contracts  to  writing,  but  they  were  certain- 
ly not  applicable  to  the  case  at  bar.  The 
parties  to  this  suit  embodied  their  agree- 
ment of  sale  in  a  written  conti'act,  and  sign- 
ed it.  So  careful  were  they  that  there 
should  be  no  question  what  their  contracts 
were  and  what  they  were  not,  that  they  re- 
duced to  writing  and  signed  no  less  than 
tive  agreements  of  modification  of  their  orig- 
inal contract.  In  these  various  agreements 
the  vendor  made  certain  express  warranties. 
He  guarantied  that  the  herd  sold  should 
consist  of  G.OOO  cattle  which  should  be  well 
graded  American  stock,  free  from  Texas  or 
Spanish  pedigree,  and  should  include  30 
full-blood  Durham  bulls;  that  he  would  de- 
liver all  these  cattle  by  the  close  of  the 
round-up  season  of  18S."»;  and  that  he  would 
deliver  .5.400  cattle  of  all  ages  during  the 
season  of  18S4.  But  he  nowhere  in  these 
contracts  guarantied  or  agreed  that  there 
were  8U0  beef  cattle  in  this  herd,  or  that  he 
would  deliver  any  such  cattle  to  the  pur- 
chaser. The  defendant  in  error  made  no 
plea  of  any  mistake  in  the  draft  of  these 
<-ontracts.  It  made  no  demand  for  any 
change  or  reformation  of  any  of  them. 
FvDm    these    facts    the    legal    inference    irre- 


sistibly follows  that  all  prior  representa- 
tions, statements,  and  declarations  made  in 
good  faith,  and  all  prior  oral  contracts, 
were  merged  in  these  written  agreements, 
and  that  they  contained  all  the  warranties 
aud  guaranties  that  the  parties  to  these  ne- 
gotiations made.  They  contained  some  war- 
ranties. The  conclusion  is  irresistible  that 
when  they  were  made  the  parties  selected 
from  their  oral  representations  those  decla- 
rations, and  all  those  declarations,  wliich 
they  agreed  to  warrant  or  guaranty,  and 
embodied  them  in  these  written  agreements. 
"Expressio  unius  est  exclusio  alterius."  In 
the  absence  of  fraud  or  mistake  in  reducing 
complete  contracts  of  sale,  containing  war- 
ranties, to  writing,  the  presumption  is  con- 
clusive that  they  contain  all  the  warranties 
that  the  parties  intended  to  make  or  did 
make.  The  supreme  court  of  Minnesota 
states  the  rule  thus: 

"Where  the  parties  have  deliberately  put 
their  engagements  into  writing,  in  such 
terms  as  to  import  a  legal  obligation,  with- 
out any  uncertainty  as  to  the  object  or  ex- 
tent of  such  engagement,  it  is  conclusively 
presumed  that  the  whole  engagement  of  the 
parties,  and  the  manner  and  extent  of  their 
undertaking,  was  reduced  to  writing." 
Thomp.son  v.  Libby.  34  Minn.  374.  377.  -!(5 
N.  W.  1;  1  Greenl.  Ev.  §  275;  Barnes  v. 
Railway  Co.,  12  U.  S.  A  pp.  1.  7.  4  C.  C.  A. 
199,  and  54  Fed.  87;  McMurphy  v.  Walk- 
er. 20  Minn.  382.  38(;  (Gil.  334);  Harmon  v. 
Harmon.  51  Fed.  113,  115. 

The  result  is  that  the  plaintiff  in  error 
was  not  liable  for  the  breach  of  auy  guar- 
anties or  warranties  not  found  in  his  writ- 
ten contracts,  and  it  was  error  for  the  court 
to  instruct  the  jury  that  they  might  find 
that  any  statements  of  facts  which  he  made 
to  induce,  and  which  did  induce,  the  con- 
tract of  sale,  were  express  warranties,  for 
whose  breach  he  was  liable.  [Moreover,  if 
the  plaintiff"  in  error  had  warranted  that 
there  were  800  beef  cattle  in  the  herd  sold, 
and  there  were  in  fact  no  such  cattle  there, 
the  measure  of  damages  for  the  breach  of 
this  warranty  would  not  have  been  the 
value  of  800  beef  cattle.  It  is  conceded  that 
there  were  more  than  8(X)  cattle  in  the  herd, 
and  the  measure  of  damages  for  the  breach 
of  a  contract  that  800  of  them  were  beef 
cattle  could  not  be  more  than  the  difference 
between  the  value  of  800  beef  cattle,  and 
the  value  of  800  of  the  best  cattle  found  in 
the  herd.  The  defendant  in  error  had  a 
written  guaranty  of  the  number  of  the  cat- 
tle in  the  herd,  for  the  breach  of  which  it 
was  entitled  to  recover  the  difference  be- 
tween the  value  of  the  number  of  cattle  ac- 
tually there,  and  the  value  of  the  U,000  cat- 
tle guarantied  to  be  there.  If,  in  addition 
to  these  damages,  it  could  also  recover  the 
value  of  the  800  beef  cattle,  the  plaintiff 
in  error  would,  in  effect,  be  required  to  fur- 
nish the  equivalent  of  G,000  cattle  guaran- 
tied   in   his   written   contract   plus   800   beef 


22S 


AVOIDANCE  OF  CONTRACT. 


caltlo,  or  in  all  t;,s(M)  cattle,  aud  that  was 
not  the  contract. 

There  are  many  other  assii^unieiits  of  er- 
ror in  this  case.  Those  which  we  have  no- 
ticed present  basic  questions  that  will  re- 
turn for  consideration  upon  the  second  trial. 
Many  of  those  raised  by  the  other  assij^n- 
nieiits  present  minor  questions  that  may  not 
arise  again,  and  it  would  serve  no  good 
purpose  to  extend  this  opinion  by  noticing 
them. 

The  fundamental  principles  which  must 
govern  this  case  are:  One  who  is  induced 
to  make  a  disadvantageous  contract  of  pur- 
'•hase  by  the  fraudulent  misrepresentations 
of  his  vendor  has  a  choice  of  remedies.  He 
may.  upon  the  discovery  of  the  fraud,  re- 
scind tlie  contract,  restore  what  he  has  re- 
ceived, and  recover  what  he  has  paid,  or  he 
nniy  enforce  the  contract,  and  recover  the 
<himages  caused  by  the  fraud  which  in- 
duced liini  to  make  it.  but  he  cannot  do 
both.  If  In  chooses  the  latter  remedy  he 
inav    recover,    for   the   fraud    which    induced 


the  contract,  the  difference  between  the 
value  of  what  he  had  befor^'  he  made  the 
contract,  and  the  value  of  what  he  would 
have  had  after  tne  contract  was  made,  if 
it  had  been  duly  perfornn-d  by  both  parties 
to  it.  In  addition  to  tliese  damages,  if  the 
vendor  has  unlawfully  failed  to  perform  his 
part  of  the  contract  and  to  keep  his  war- 
ranties, the  vendee  may  recover,  as  dam- 
ages for  such  breaches,  the  difference  be- 
tween the  value  of  the  property  actually  re- 
ceived, less  that  portion  of  the  purchase 
price  secured  to  the  vendor  by  the  mort- 
gage back  upon  it.  and  the  value  which  the 
proi)ertj'  would  have  had,  less  that  portion 
of  the  purchase  price  secured  to  the  vendor 
by  the  mortgage  back  upon  it,  if  the  con- 
tract had  been  duly  performed.  A  careful 
ai)plicatiou  of  these  rules  will,  we  think, 
result  in  an  impartial  trial  of  this  ca.se. 
The  judgment  below  must  be  reversed,  and 
the  case  must  be  remanded  to  the  court  be- 
low, with  directions  to  grant  a  new  trial, 
and   it   is  so  ordered. 


AVOID  A.NCE  OF  CONTEACT. 


229 


LUKENS  T.  AIKEN. 

(34  Atl.  575,  174  Pa.  St.  152.) 

Supremo  Court  of  Pennsylvania.      Miirr-h  2, 
180(!. 

Appeal  from  court  of  common  pleas,  Ches- 
ter county;  W.  B.  Waddell,  Judj^e. 

Action  by  George  W.  Lukens  against  .lohn 
Aiken.  There  was  a  judgment  for  plaintiff, 
and  defendant  appeals.     Affirmed. 

W.  S.  Harris,  for  apfx^llant.  Thomas  W. 
Pierce  and  George  B.  Johnson,  for  appellee. 

WILLIAMS,  J.  This  appeal  depends  upon 
the  correctness  of  the  I'nle  given  hj-  the  learn- 
ed judge  of  the  court  below  to  the  jury  upon 
the  measure  of  damages  to  which  the  de- 
fendant was  entitled.  The  action  was  upon 
a  note  given  by  the  defendant  for  a  balance 
of  purchase  money  due  to  the  plaintiff  for 
machineiy  bought  of  him.  The  defense  was 
tliat  the  pui'chase  of  the  machinery  was  in- 
duced by  false  representations  made  by  the 
plaintiff  as  to  the  character,  effectiveness, 
and  state  of  I'eirair  of  the  machinery  at  the 
time  of  sale.  Evidence  was  given  upon  the 
trial  tending  to  show  that  false  representa- 
tions were  made  to  the  defendant,  and  that 
lie  had  expended  some  money  and  lost  some 


time  in  the  effort  to  put  the  machinery  in 
good  working  condition,  with,  however,  but 
indifferent  success.  Upon  this  state  of  the 
evidence  he  asked  (he  court  to  tell  the  jury 
that  he  was  entitled  not  only  to  defeat  a  re- 
cove!"A'  upon  the  note,  but  also  to  recover 
back  all  the  purchase  money  previously  paid, 
all  the  p.xpenses  incurred,  and  compensation 
for  all  time  lost,  without  having  rp.s(inded 
the  contract  or  returned  the  machinery.  This 
the  learned  judge  declined  to  do.  but  instruct- 
ed the  jury  that  one  who  had  been  imposed 
upon  or  misled  by  false  and  fraudulent  rep- 
resentations must  elect  which  of  two  courses 
of  conduct  he  would  pursue.  He  had  the 
light  to  rescind  the  contract,  return  the  arti- 
cles purcha.sed,  and  demand  the  return  to  him- 
self of  the  purchase  money;  or  he  could  re- 
tain the  property  purchased  and  defend 
against  the  purchase  money,  or  recover  in  an 
action  for  the  deceit  the  difference  between 
the  value  of  the  goods  as  represented  or  war- 
ranted, and  their  actual  value  at  the  time  of 
the  sale.  This  was  a  correct  statement  of  the 
law  applicable  to  the  facth  alleged  by  the  de- 
fendant, and  we  see  no  reason  for  complaint 
on  his  part.  The  assignment  of  error  which 
embodies  this  instruction  is  overruled,  and 
the  judgment  is  affirmed. 


230 


AVOIDANCE  OF  CONTRACT. 


CORTLAND  MANI'F'G  CO.,  Limited,  v. 
PLATT   et    al. 

(47  N.   W.  330.  S3  Mich.  419.) 
."^uprciiK-  C.)iirt  ol'  .Mic-higan.     Nov.  5,  1800. 
Jhior    to    tircuit    court,    Borrioii    county; 
Thomas  O'llara.  .ludjje. 

G.  M.  Valentino  and  S.  Tryon,  for  appel- 
lants. (Jeo.  S.  Clapp,  A.  Phinimer,  N.  A. 
Hamilton,  and  L.  C.  Fyfe.  for  appellee. 

CHAMPLIN.  C.  J.  I'laintiff  l)rou^'llt  re- 
pl»>vin  for  certain  wagons,  poles,  and  seats. 
The  defendant  (Jeorye  W.  Piatt  had,  prior  to 
Februai-y  3.  1889,  been  en,ira,s;ed  in  the  mer- 
cantile business  at  Benton  Harbor,  the  prin- 
cipal line  of  his  business  beiuir  hardware.  He 
was  also  interested  in  the  milling:  business 
at  tliat  place.  He  was  assisted  in  his  store 
by  his  son.  Frank  H.  Piatt,  who.  during  his 
father's  absence,  or  inability  to  attend  to 
business,  on  account  of  sickness,  exercised 
full  control  over  the  business.  In  1887. 
(Jeorge  W.  Piatt  drew  money  out  of  his  bard- 
ware  business  to  invest  in  the  milling  busi- 
ness; and.  to  meet  a  bank-note  and  bills 
maturing  on  August  7,  1887.  he  borrowed  .$3,- 
000  of  the  Bank  of  Benton  Harbor,  and  gave 
seciH'ity,  by  way  of  a  chattel  mortgage,  upon 
his  stock  of  liardware.  This  mortgage  was, 
by  mutual  consent,  not  placed  upon  tile,  and 
in  December.  18S7,  this  debt  had  all  been 
paid  except  JKOOO.  for  which  the  bank  took 
three  notes,  of  $300.  .$100.  and  $500,  respec 
tively.  On  .Tamiary  27,  1888,  there  was  due 
on  this  mortgage  the  principal  sum  of  $G00, 
and  on  that  day.  unknown  to  Piatt,  the  mort- 
gage was  plac-ed  on  file.  On  February  2, 
1888,  the  mortgage  was  paid  in  full  and  dis- 
charged. The  filing  of  the  mortgage  caused 
inquiries  to  be  made  by  the  creditors  of 
Piatt,  w-ho  was  then  sick;  and  his  son,  Frank 
H.,  without  the  knowledge  of  his  father,  pre- 
pared, and  on  the  10th  day  of  February,  1888, 
gave  to  the  collecting  agency  of  R.  G.  Dun 
&  Co.,  a  statement  of  the  financial  standing 
of  George  W.  Piatt  on  the  1st  day  of  .Tami- 
ary. 1888.  as  follows: 

Benton  Marbor  Milling  Co $  4.000  (X) 

4V/>    acres    in    citv    limits,     Niles, 

Mich .'>.000  00 

House  and  lot  St.  Jo.,  Mich 2.0OO  00 

One-seventh  interest  in  estate,  Nlles, 

Mich 1.000  00 

One-half  interest   in   store,   lot,  and 

building,    Bangor,    Mich 500  00 


Incumbrance   on    aiiove. 


Invoice  merchandise   .  .   $14,031  27 

Tinners'  tools  and  store 
fixtures    830  00 

Notes     2.105  ,50 

Accounts  receivable   .  .  .        5,3.53  05 

Freight,  boxing,  and 
carting  on  merchan- 
dise, 3  per  cent 419  73 


$12,500  00 
5,000  00 

$  7,500  00 


$22,805  61 
Liabilities,  sundry  acc'ts       7,015  49     15,190  12 


Total  assets  in  excess  of  liabil- 
ities       $22,690  12 


A  schedule  of  lial)ilities  upon  merchandise 
accounts  was  attached.  The  correctness  of 
the  statement  was  sworn  to  by  Frank  H. 
IMatt.  On  May  12,  1888,  Dun's  agency  at- 
tached to  such  statement  of  Piatt  "an  opinion 
of  statement"  of  their  own,  as  follows: 

"May  12.  '88.  Opinion  of  statement. 
Should  suppose  that  the  only  (piestion  here 
would  be  as  to  the  value  of  the  real  estate, 
etc.  Writer  has  seen  his  ledger,  which 
shows,  as  he  recollects  it,  something  of  this 
.sort:  Estimated  Niles  property  at  $5,(KX). 
Understand  that  it  is  worth  about  $4,000." 

Again,  on  .Tune  5th,  Dun's  agency  made 
another  report,  as  follows: 

".Tune  5,  '88.  "  In  Avriter's  opinion,  following 
is  a  more  correct  statement:  Invoice  of  mer- 
chandise, .$8,000:  tinners'  tools,  etc.,  $500; 
farmers'  notes.  $2,165.56;  accounts  receiva- 
ble, $5.3.53.05;  3  per  cent,  for  freight,  etc., 
$419.73.  Ha^e  very  good  reasons  for  placing 
invoice  at  $8,000.  The  tinners'  tools  are  old. 
and  more  or  less  out  of  date,  and  hardly 
worth  $500.  The  farmers'  notes  may  foot  up 
tlie  figures  given,  but  for  some  reason  were 
not  discountable  at  the  time  of  the  chattel- 
mortgage  difficulty.  Feb.  2,  1888.  Accounts 
receivable  are  not  worth  over  fifty  cents  on 
the  dollar,  $3,211. s;i;  3  per  cent.,  boxes,  cart- 
age, etc.,  $240,— total,  $14,117.89;  liabilities, 
total  indebtedness  on  stock,  $7.615.49.— bal- 
ance, $6..501.90;  160  shares  in  milling  com- 
pany, at  .$25,  $4,000;  41  acres,  Niles  city  lim- 
its, $5,000;  St.  Joseph  house  and  lot,  $2,000; 
1/7  interest  in  house  of  Piatt  estate,  $1,000; 
%  interest  in  Bangor  house  and  lot.  $500.— 
total.  $19,001.90;  mortgage  incumbrances,  $5,- 
000.  As  to  160  shares,  he  first  bought  80 
shares,  at  $25.  making  $2,000;  subsequently 
suliscribed  for  80  more,  and  hypothecated  the 
first  80  to  secure  the  payment  of  the  second 
80,  leaving  only,  say  $2,000.  The  41  acres 
are  not  worth  $5,000.  They  are  not  worth 
more  than  $2,500.  An  outside  figure  is  $3.- 
000.  The  St.  Joseph  bouse  and  lot  he  recent- 
ly sold  for  $1..500.  1/7  interest  in  the  Geo. 
Piatt  family  residence  at  Niles,  Mich.,  is 
good,  but  not  available.  14  intei'est  in  Ban- 
gor hou.-<e  and  lot  is  not  worth  more  than  the 
other  half,  which  recently  sold  for  $350.  Re- 
capitulation: Assets,  stock.  $14,117.89;  in- 
debtedness, stock.  $7,615.49;  balance  assets, 
$6..501.!H>:  real-estate  assets,  $7.3.50;  real-es- 
tate mortgage,  $5.000. — assets  in  excess  of 
liabilities.  .$8.8.51.90.      (Continued.)"' 

"June  2,  "88.  The  mortgage  was  dated 
Aug.  8,  '87,  but  was  not  filed  until  Jan.  28th, 
1S88.  The  note  to  which  the  mortgage  was 
<oIlateral  was  due  Nov.  5th,  1887.  so  that  this 
nominal  security  was  in  reality  not  securitj' 
for  the  interval  from  Aug.  8,  '87.  to  January 
2stli.  18SS.  In  the  mean  time  Mr.  Piatt  had 
paid  on  the  claim  $2,265.23,  so  that  at  the 
hour  of  filing  there  was  due  plus  the  interest, 
$734.78.  In  the  afternoon  of  the  same  day 
$9.25  more  was  paid.  So  far  as  Mr.  Piatt 
himself  is  concerned,  'we  would  not  have 
doubted  his  integrity.  a*nd  did  not  file  the 
mortgage  on  that  account,  but  to  anticipate 


AVOIDANCE  OF  CONTRACT. 


231 


any  other  creditors,  of  whose  number  or  ex- 
tent we  were  not  thoroughly  informed. 
Have  known  Mr.  Piatt  for  some  years,  and 
have  believed  him  personally  to  be  a  man 
witli  no  bad  habits  nor  expensive  tastes, 
wliose  whole  time  was  devoted  to  liis  busi- 
ness, and  whose  desire  was  to  pay  aU.  his 
ol)ligations.  It  is  our  opinion  that  one  cause 
of  his  temporary  eml)an'assmeut  at  tlie  time 
of  our  loaning  this  money  was  tlie  pureliase 
of  stocli  in  the  Benton  Harbor  IMilling  Com- 
])any.  and  some  other  matters  tending  to 
build  up  and  benefit  this  place.  Tlie  milling 
stocli  is,  we  understand,  good  paying  prop- 
erty, but  it  has  taken  the  cash  to  pay  for 
it." 

■'August  8,  '8S.  Carries  tne  largest  stock  in 
liis  line  here.  Has  been  heavily  involved  for 
some  time,  and  came  near  malting  an  assign- 
ment last  winter,  but  instead  executed  a  chattel 
mortgage  to  the  Bank  of  Benton  Harbor,  se- 
curing .$3,(>U0,  wliicli  was  discharged  from  rec- 
ord alter  being  nearly  paid  up,  and  l^ank  toolv 
a  mortgage  on  some  real  estate  near  Niles. 
Piatt  is  treasurer  of  the  Benton  Harbor  Mill- 
ing Co.,  and  owns  $4,(X)0  of  the  stock,  which 
is  hypothecated  for  a  loan  of  $2,000.  Is  said 
to  sell  on  very  close  margins  and  below  cost  on 
many  articles,  and  it  is  not  deemed  probable 
that  he  is  making  any  money.  Is  said  to  have 
a  nominal  surplus  of  8  to  .$10,000,  but  is  not  re- 
garded a  very  safe  credit  risk." 

■'Jan.  2o,  '89.  Has  a  large  trade,  but  is  reck- 
less in  selling.  Stock  about  $7,000.  Is  hard 
up,  but  not  so  much  so  as  at  one  time.  Wortli 
about  $10,000  above  debts.     G-3-1-2." 

^^'ith  tills  statement  as  to  Piatt's  financial 
standing,  and  with  a  rating  in  Dun's  Commer- 
cial Agency  of  from  $.5,000  to  $10,000  capital 
invested  in  his  l.usiuess,  the  plaintiff  in  this  suit 
received  a  letter  from  Piatt  dated  Fel:)ruaiy  3, 
1889,  requesting  it  to  quote  prices  on  its  car- 
riages, stating  that  he  should  probably  sell  a 
few  veiy  fiue  outfits  that  seasou,  to  which  tlie 
plaintiff  replied,  under  date  of  February  10th, 
stating  prices,  and  terms  of  discount  and  credit. 
Afterwards  the  salesman  of  plaintiff  called  per- 
sonally upon  Mr.  Piatt,  and  on  :March  7,  1889, 
received  his  order,  upon  the  terms  of  90  days 
net,  .")  per  cent.  30  days.  Two  days  later,  Piatt 
wrote  plaintiff  requesting  it  to  add  to  the  order 
three  spiral-spring  carts.  Plaintiff  commenced 
shipping  the  goods  March  30,  1889,  and  made 
two  more  shipments  in  April,  when,  Ijefore 
the  goods  were  all  sliipped  and  on  April  29th, 
the  defendants  wrote  plaintiff  requesting  it  to 
cancel  order  foi'  carts  and  buggies.  It  appears 
that,  about  the  same  time,  defendant  Piatt  can- 
celed other  orders  which  he  had  made  for  goods 
from  other  parties,  for  the  reason  that  he  be- 
came satisfied  that  he  sliould  not  be  able  to 
pay  for  them. 

The  plaintiff  claims  that  it  .sold  the  goods  and 
extended  the  credit  to  defendant  solely  upon 
the  strength  of  tlie  rating  statement  of  Piatt, 
and  repoils  received  from  Dun  &  Co.,  above  set 
out.  It  also  claims. iliat  such  statement  was 
false  and  fraudulent,  and  made  for  the  purpose 


of  inducing  plaintiff  to  sell  to  him  upon  credit, 
and  that,  on  account  of  such  fraud,  it  had  a 
right  to  rescind  tlie  sale  and  reclaim  the  goods. 
I'laintiff  also  c-laims  that  Pbitt,  at  the  time  he 
puivhasetl  the  goods  of  ])lain(iff.  did  not  intend 
to  pay  for  them.  Accordingly  the  plaintiff  sent 
its  attorney  to  Benton  Harbor,  where  he  ar- 
rived on  May  18,  1889.  This  was  on  Satur- 
day. He  called  at  the  store,  where  he  found 
Frank  H.  Piatt,  and  was  informed  that  (Jeorge 
W.  Piatt  was  sick.  He  told  Frank  H.  that  he 
had  heard  that  fliey  had  been  putting  some 
mortgages  on  tlie  property  there,  and  it  was 
not  looking  just  right,  and  he  had  come  to  see 
what  there  was  about  it.  That  Fraulv  H.  told 
him  they  had  given  some  mortgages,  and,  upon 
further  iiuiuiry,  he  stated  to  whom  and  the 
amounts.  He  was  told  that  the  mortgages 
covered  the  whole  stock,  including  the  wagons, 
and  he  said  to  Frank  that  they  did  not  .send 
the  wagons  to  him  to  be  mortgaged  for  old 
family  debts,  but  they  \\-ere  sent  supposing 
tliat  Piatt  would  .sell  them  in  the  course  of  busi- 
ness, and  then  pay  for  them.  He  replied  that 
they  should  pay  their  debts;  they  expected  to; 
they  should  get  their  money  upon  their  notes 
and  accounts,  and  pay  eveiythiug  in  three 
months.  He  then  told  him  that  he  did  not 
want  to  make  unnecessary  tiouble;  that  he  did 
not  like  the  looks  of  things  there;  and  if  he 
tliought  he  was  going  to  pay  in  three  months, 
if  he  could  give  plaintiff  a  note  payable  in  six 
mouths,  with  an  indorser.  without  interest,  it 
would  be  satisfactory  to  it.  It  would  give  him 
three  months'  extra  time  in  case  he  did  not  get 
arouud  to  pay  all  his  debts.  Frank  said  he  did 
not  want  to  do  that.  Further  conversation  en- 
sued, in  which  the  plaintiff's  agent  suggested 
that  perhaps  I'lalt  could  get  Mr.  Tatman,  who 
then  held  a  chattel  mortgage  as  security  for 
indorsing  defendant's  notes,  to  sign  a  note  with 
Piatt  for  the  debt  due  plaintiff,  and  he  said  he 
would  not  want  to  do  that.  The  witness  tes- 
tified: "I  said  to  him:  'If  you  are  not  willing  to 
do  that.  I  have  not  much  faith  in  your  talk 
about  paying  in  three  months.  'S^'ith  tlii'se 
notes  here,  you  cannot  expect  us  to  be  easy.* 
Then  I  said  to  him:  'So  we  shall  have  to  re- 
claim our  goods.  These  wagons  we  shall  take 
back.'  That  is  what  I  was  here  for,— to  re- 
claim These  wagons  if  the  matter  was  not  sat- 
isfactory, so  we  could  get  the  pay  out  of  it." 
It  is  claimed  by  d(>fendants'  counsel  that  this 
was  such  a  recognition  of  the  contract  relations 
between  the  parties  as  amouuted  to  a  raiiliea- 
tion  of  the  contract  of  sale.  But  I  do  not 
think  so.  It  was  a  mere  effort  to  get  security 
for  payment  of  the  debt.  Had  he  taken  se- 
curity, or  given  a  valid  extension  of  time  of 
payment,  it  would  have  bwn  different.  A  per- 
son defraud(Hl  doi's  not  lo.se  his  right  to  rescind 
by  making  an  effort  to  compromi.se  or  obtain 
pay  for  the  property,  unless  he  does  some  act 
which  evinces  a  clear  intention  to  waive  his 
right  to  rescind. 

For  the  purpose  of  showing  the  falsity  of  the 
statement  made  by  Frank  H.  Piatt  of  his  fa- 
ther's financial  standing  on  January  1.   1888, 


2:52 


AVOIDANCE  OF  COXTIIACT. 


J.  H.  Brcckcniidiic  w;is  iiitnxljccd  ns  a  witness 
on  the  part  of  the  iilainlUT.  and  tc^slilicd  that 
he  had  lu'i'ii  a  book-kci'ijcr  for  l")  or  It;  years 
lit  Johel  and  Chicago,  111.,  aud  had  examined 
the  books  of  account  of  Cieorije  W.  I'latt  with 
F.  A.  Ilobhs.  On  his  direct  examination,  he 
testified  that  on  January  1,  188S,  the  books 
showed  net  assets  ,"t;fo,87(J.2-t,  and  that  there 
was  a  difference  betAveen  what  the  books  show- 
ed and  the  statement  of  !fi).8i:j.S8.  He  at- 
temi)ts  to  exjtlain  the  method  he  pursued  to 
r(>ach  his  conclusion,  which  from  his  testimony 
is  not  ver.v  satisfactory.  He  deducts  items 
which  the  books  of  George  W.  Piatt  show  were 
in  the  banks  at  that  date,  because  an  examina- 
tion of  the  books  of  the  banks  shows  that  cer- 
tain checks  had  been  chaiged  up  against  the  ac- 
counts, making  a  difference  of  $1,027.44;  but 
it  was  shown  that  the  checks  had  been  used  in 
reducing  liabilities  to  that  amoiuit.  He  deducts 
.S2.(iiM»  from  real  estate,  for  the  reason  that  he 
finds  from  the  cash-book  the  house  and  lot  had 
been  sold,  and  the  proceeds  put  into  the  store, 
and  a  note  given  therefor  to  Jane  E.  Piatt, 
which  he  puts  Avith  the  liabilities.  On  his 
cross-examination,  he  admits  that  the  accounts 
receivable,  as  shown  by  the  books,  were  $4,- 
1I2G.94,  and  the  bills  receivable  were  $l.!)2.j.r)(j, 
making  a  total  of  $(I8r)2.oO;  and  that  in  his 
memoranda  he  only  called  them  $3, 421120;  and 
that,  counting  them  at  their  face,  Piatt  would 
be  worth  $3,420.2.")  more  than  he  had  testilied 
he  was  worth  the  day  before.  It  apiiears  that 
this  witness  testilied  from  memoranda,  and 
that,  upon  adjournment  of  court  in  the  evening 
before  he  was  cross-examined,  counsel  for 
plaintitt"  furnished  defendants'  attorney  with  a 
copj'  of  some  figures  purporting  to  be  those  used 
by  the  witness.  The  next  morning  the  court 
called  upon  cumisel  for  defendants  to  produce 
such  memoranda  and  have  them  marked  as  an 
exhibit.  They  had  not  been  offered  in  evi- 
dence, and  counsel  for  defendants  did  not  ad- 
mit them  to  be  copies  of  the  memoranda  from 
which  witness  testilied.  Nevertheless  the  court 
insisted  that  they  should  be  marked  as  an  ex- 
hibit, to  be  printed  with  the  record  in  case  the 
cause  should  be  taken  to  the  supreme  court,  but 
should  not  be  read  in  evidence  or  considered  in 
evidence  upon  the  trial.  The  court  stated  that 
he  made  "the  order  in  view  of  Mr.  Valentine's 
refusal  last  evening  to  admit  that  these  figures 
were  furnished  by  counsel."  Exception  was 
taken  to  such  ruling.  That  this  was  error 
there  can  hn  no  doubt,  but,  so  far  as  we  can  see. 
it  Avas  harmlfss  error.  The  exhibit  is  returned 
and  printed  in  the  record,  but  is  not  considered 
by  this  court. 

EiTor  which  was  prejudicial  was  ci  uunitted 
upon  the  examination  of  the  witness  F.  A. 
Hobbs.  He  Avas  a  book-keeper  and  coal-deal- 
er, and  lived  in  Benton  Harbor.  He  assisted 
Breckenridge  in  the  examination  of  the  books, 
and,  in  testifying,  made  use  of  memoranda, 
and  swore  that  he  could  ucjt  testify  to  the  exact 
fi.inn-es  Avithout  the  aid  of  the  memoranda,  and 
that  he  had  used  it  to  get  at  the  exact  tigui'es 
throughout  his  direct  examination;    that  all  the 


figurc^s  upon  it  related  to  tlr^  examination  of 
the  books  ma<le  by  him  and  Breckeiu'idge. 
Counsel  for  defendants  requested  the  privilege 
of  inspecting  the  pai/er  to  CTiable  them  to  cross- 
(wamine  the  Avituess.  Counsel  for  plaintiff  re- 
fused, and  the  court  sustained  the  objection, 
Duncan  v.  Seeley,  34  Mich.  3()9;  People  v.  Ly- 
ons. 4J)  Mich.  78,  13  N.  W.  3(r.. 

G.  L.  Manchnnd.  a  Avituess  produced  by  the 
dtfendants,  testilied  that  he  had  been  an  ac- 
countant since  about  1871.  and  had  been  em- 
ployed by  Avliolesale  dealers  of  Chk-ago,  and  by 
the  auditor  of  the  state  of  Illinois;  that  he  had 
examined  the  books  of  George  "W.  Piatt,  Avith 
a  vieAv  of  aKccrtaining  his  assets  and  lialiilities 
on  January  1,  1888,  January  1.  1880,  and  May 
12,  1881).  He  produced  detailed  statements 
from  Avhich  it  appears  that  George  W.  Piatt's 
net  investment  on  January  1,  1888,  was  .$24,- 
.533.08;  on  .January  1,  1889.  it  was  $10.83."'..82; 
and  on  May  12.  1SS9,  it  Avas  $12,009.."j8.  That 
the  net  shrinkage  in  the  assets  between  Janu- 
ary I,  1888,  and  May,  1889.  Avas  $12..-)24.10, 
and  he  gave  the  items  by  Avhich  he  accounted 
for  such  shrinkage.  He  also  testified  that 
"G  31,4"  represented  a  rating  in  Dun's  Commer- 
cial Agenc.v;  that  the  letter  "G"  is  supposed  to 
represent  the  amount  of  capital  InA'ested,  and 
stands  for  from  $.j,Oa)  to  $10,000.  "SVo"  refers 
to  his  credit,  and  means  "fair."  The  state- 
ment and  repoi'ts  accompanying  sent  out  by 
Dun  &  Co.,  and  receiA^ed  and  acted  upon  by 
plaintiff,  aft'orded,  imder  the  testimony  in  this 
case,  no  ground  Avhatever  for  rescinding  the 
contract  of  sale.  The  last  report,  dated  Jan- 
uary 23,  1889,  AA^as  that  George  W.  Piatt  had  a 
large  trade,  but  was  reckless;  that  he  had  a 
stock  of  about  $7,000;  that  he  Avas  hard  up, 
but  not  so  much  so  as  one  time,— Avorth  about 
$10,000  above  debts.  The  jury  were  asked  to 
find,  and  retmned  that  they  found,  that,  in 
making  the  sale,  the  plaintiff  relied  upon  the 
R.  G.  Dun  &  Co.  report  in  evidence;  and  they 
further  found  that  George  W.  Piatt  was  Avorth, 
at  the  time  he  made  the  contract  for  the  goods  in 
question,  $.'i,000,  or  more,  over  and  aboA'e  all  his 
liabilities,  and  that,  when  he  purchased  such 
goods,  he  intended  to  pay  for  them.  Taking 
the  Avhole  of  the  reports  made  by  Dun  &  Co,, 
the  facts  therein  shoAvn  to  exist  correspond 
Avitli  this  finding  of  the  jury.  There  was  am- 
ple testimony  in  the  case  to  justifv  such  find- 
ing, and  the  court  should  have  charged  the  jury 
that  unless  the  testimony  satisfied  them  that, 
at  the  time  George  W.  Piatt  purchased  the 
goods,  he  did  not  intend  to  pay  for  them,  or  un- 
less they  were  satisfied  from  the  testimony  that, 
at  the  time  he  purchased  the  goods,  there  Avas 
a  substantial  difference  between  the  rejxtrt  of 
Dim  &  Co.  as  to  his  financial  standing  and  his 
actual  financial  condition  at  that  time,  so  great 
as  to  convince  them  it  Avas  the  intention  of 
George  W.  Piatt  to  defraud  the  plaintiff  by  ob- 
taiinng  such  goods  upon  credit,  then  their  ver- 
dict should  be  for  the  defendants. 

This  coui't  has  not  gone  so  far  in  any  case  as 
to  hold  that  traders  nnist  teport  to  the  mercan- 
tile  agencies  OAery  variation    in   their  circum- 


AVOIDANCE  OF  CONTKACT. 


23'1 


stances.  It  is  only  when  they  are  in  an  insol- 
vent condition,  anil  they  are  or  shonld  be  aware 
that  they  will  be  oblijretl  to  susi)end  or  fail  in 
their  bnsiness,  that  they  owe  it,  as  a  duty  to 
creditors,  or  those  they  solicit  to  deal  with  them 
upon  credit,  to  inform  them  of  their  situation, 
or  to  notify  the  commercial  agencies  of  their 
change  of  situation.  I'urcliases  not  made  in 
good  faith,  while  in  such  straits,  ma.v  well  be 
regarded  as  fraudulent.  But  no  fraud  can  be 
])redicated  upon  the  fact  that  a  merihant  or 
trader  makes  a  representation  of  his  standing 
which  is  truthful  at  the  time  to  a  conunercial 
agency,  and  thereby  obtains  credit.  If  a  con- 
siderable time  elai)ses,  and  no  new  statements 
are  made,  and  no  new  representations  as  to  his 
standing,  it  cannot  be  said  that,  if  his  condition 
has  changed,  he  is  guilty  of  actual  fraud,  un- 
less he  knows,  or  the  circumstances  are  such 
that  he  should  know,  that  the  credit  is  extended 
upon  the  strength  of  the  original  rating  of  the 
commercial  agency.  Fraud  is  a  question  of 
fact  to  be  detluced  from  all  the  circumstances, 
and  a  vendor  cannot  shut  his  eyes  to  the  sub- 
secpient  reports  of  the  commercial  agencies 
tending  to  cast  doubt  and  suspicion  upon  the 
liuancial  ability  and  credit  of  a  merchant  or  trad- 
er, and  rely  upon  a  statement  by  such  person 
made  a  year  before.  The  court  correctly  in- 
stiiicted  the  .1ury,  as  matter  of  law,  that  the 
plaintiff  had  a  right  to  rely  upon  such  report, 
inasnuich  as  Piatt  himself  had  made  a  state- 
ment to  R.  G.  Dun  «&  Co.,  but  that  it  must  be 
presumed  that  the  plaintiff,  if  it  relied  at  all  up- 
on the  report,  relied  vpon  the  report  sent  by  R. 
(4.  Dun  &  Co.  as  a  Avhole,  and  not  upon  any 
particular  part  of  it.  But  the  court  immediate- 
ly after  proceeded,  inadvertently,  it  may  be  pre- 
sumed, to  instmct  the  jury  as  follows:  "Now, 
then,  gentlemen,  if  Geo.  W.  Piatt  on  .Tanuaiy 
1,  1888.  was  worth  a  material  sum  less  than  ap- 
pears from  the  I'epresentations  made  by  Frank 
to  K.  G.  Dun  &,  Co.,  and  if  this  plaintiff,  when 


shipping  the  wagons,  relied  upon  such  state- 
ment, and  shipped  tiicm  on  the  strength  of  such 
statement,  and  if,  when  the  wagons  in  ques- 
tion were  shipi'tHl,  Geo.  W.  Platfs  pecuniary  af- 
fairs Avere  matciially  worse  than  was  disclosed 
in  the  repoit  of  R.  G.  Dun  &  Co.  as  a  whole, 
this  plaintilt  had  the  light  to  rescind  the  con- 
tract of  sale,  and  to  take  back  all  wagons  not 
sold  to  bona  fide  pm-chasers,  no  matter  whether 
Frank  II.  Piatt  did  or  did  not  intend  to  make 
a  false  statement  to  R.  G.  Dun  &  Co."  Here 
the  statement  made  by  Franlv  H.  Piatt  is  given 
undue  prominence,  and  the  jury  are  told  that 
if  plaintilT  relied  on  this  statement,  instead  of 
the  report  as  a  wiiole,  as  he  should  have  char- 
ged, then  the  plaintiff  could  rescind.  It  is  ti'ue 
that  this  error  was  modified  siibsequently  by 
including  the  whole  report,  as  an  inducement 
to  the  sale;  but  we  cannot  say  that  the  jury 
did  not  give  weight  to  this  portion  of  the  charge, 
mor6  especially  as  we  cannot  otherwise  con- 
ceive of  any  b  "^is  for  a  general  verdict  for  the 
plaintiff.  The  special  tinding  above  stated  re- 
quired that  the  general  verdict  should  have  been 
rendered  for  the  defendants.  It  is  the  only 
one  that  can  be  I'endered  consistent  with  the 
special  findings.  This  view  of  the  merits  ren- 
ders it  unnecessary  to  discuss  many  of  the  er- 
rors assigned  upon  the  record. 

The  defendants'  counsel  moved  the  court  tliat 
judgment  be  entered  for  the  defendants  uijon 
the  special  findings  of  the  jury,  which  motion 
the  court  refused,  and  instead  rendered  a  judg- 
ment for  the  plaintiff  upon  the  general  verdict. 
The  jvidgment  must  be  reversed.  Avith  costs  of' 
both  courts  to  defendants,  and  the  cause  re- 
manded, M-ith  instinctions  to  the  trial  court  to 
vacate  and  set  aside  tlie  judgment  for  plaintiff, 
and  to  render  judgment  in  favor  of  defendants, 
to  the  end  that  such  fm-ther  proceedings  may 
be  had  therein  governing  the  action  of  replevin 
as  the  statute  requires.  The  other  justices  con- 
cuiTed. 


2;j4 


AVOIDANCE  OF  CONTRACT. 


CRAXE   CO.    V.    COLUMBUS    CONST.    CO. 

(20  C.  C.  A.  233,  73  Fed.  984.) 

Cirtuil  Court  of  Appeals.   Seventh   Circuit. 
May   4,   1896. 

No.  268. 

In  error  to  the  circuit  court  of  the  United 
States  for  the  Northern  district  of  Illinois, 
Northern  division. 

This  was  an  action  by  the  Columbus'  Con- 
struction Company  apiinst  the  Crane  Company 
to  recover  for  a  lefxed  breach  of  a  contract  of 
.sjile.  The  circuit  coui-t  sustained  demuiTers  to 
the  declaration,  and,  plaintiff  dedinins  to 
amend,  judj,nuent  was  rendered  for  defendant. 
On  appeal  to  this  court,  that  judirmeut  was  re- 
versed, and  the  cause  remanded  for  further 
proctc(hn-s.  3  C.  C.  A.  216,  .j2  Fed.  G35. 
Afterwards  a  trial  was  had  before  a  jury,  re- 
sulting in  a  verdict  and  judgment  for  plaintiff 
in  the  sum  of  .$48,000.  and  defendant  brings 
the  case  here  on  writ  of  error. 

Edwin  Walker  and  Chas.  S.  Holt,  for  plaintiff 
in  error.  Geo.  Hunt  and  S.  S.  Gregoiy,  for 
defendant  in  error. 

Before  WOODS,  JENIvINS,  and  SHO WAL- 
TER. Circuit  Judges. 

"WOODS,  Circuit  Judge.  For  the  entire  con- 
tract between  the  parties  to  this  appeal,  and 
for  ihe  constraction  put  upon  it  by  this  court 
when  the  case  was  first  here,  reference  is  made 
to  the  opinion  in  Columbus  Const.  Co.  v.  Crane 
Co.,  3  C.  C.  A.  216,  52  Fed.  63.j,  and  9  U.  S. 
App.  46.  After  the  case  had  been  remanded, 
further  counts,  special  and  common,  were  added 
to  the  declaration;  but,  while  the  breaches  of 
warranty  relied  upon  and  the  damages  claimed 
were  stated  more  specifically  and  fully,  the 
character  of  the  action  was  not  changed. 

The  defendant  in  error,  the  Columbus  Con- 
struction Company,  a  coiiDoration  of  New  Jersey, 
on  the  ~Ah  day  of  Jime,  1890,  entered  into  a 
contract  with  the  Indiana  Natural  Gas  &  Oil 
Company  (which  was  incorporated  under  the 
laws  of  Indiana  for  the  purpose  of  owning 
and  operating  a  pipe  line  for  the  transporta- 
tion of  natural  gas  from  the  gas  fields  of  In- 
diana to  Chicago),  whereby  the  Columbus  Com- 
pany undertook  to  constioict  the  proposed  line; 
and  to  that  end,  on  June  20,  1890,  it  made 
with  the  Craje  Company  (the  plaintiff  in  error) 
the  contract  in  suit,  whereby  the  latter  com- 
panj'  imdertook  to  purchase,  and  to  cause  to 
be  delivered  to  the  former,  the  various  quanti- 
ties and  sizes  of  pipe  necessary  for  the  comple- 
tion of  the  line,  including  260  miles  of  8-inch 
pipe  concerning  which  this  controversj-  has  aris- 
en. The  sul)stance  of  the  contract,  in  so  far 
as  it  need  be  stated  here,  is  that  the  pipe  shall 
1)6  "8-inch  wrought-iron  standard  line  pipe,  to 
weigh  not  l(ss  than  27.48  pounds  per  lineal 
foot,"  "made  from  .soft  iron,  free  from  blistei-s 
and  other  imperfections,  and  guarantied  to 
stand  a  working  line  pressure  of  one  thousand 
pounds  to  the  square  kich  when  proved  and 
tii^ted  m  lines";  that  each  spliced  joint  shall 
weigh  the  weight  of  the  collar  in  addition  to  its 


own  reciuiri-d  weight;  that  each  joint  of  pipe 
shall  have  eight  threads  to  the  inch,  and  at 
least  two  inches  of  thread  on  each  end,  with  a 
full  uniform  taper  to  the  threads  both  on  the 
pipe  and  in  th-  collar;  and  that  the  vendor 
shall  pay  to  the  vendee  all  damages  and  ex- 
penses sustained  by  reason  of  defects  in  the 
pipe  delivered,  up  to  and  including  the  time 
when  the  pipe  should  be  tested  by  the  vendee 
under  wf)i'king  pressure,  not  in  excess  of  one 
thousand  pounds  to  the  square  inch,  and  proved 
tight  in  line,  which  working  test  should  be  made 
with  reasonable  promptness.  Deliveries  were 
to  be  made  at  such  places  as  should  be  desig- 
nated by  the  Columbus  Company,  at  the  earliest 
practicable  dates,  in  July,  August,  and  Septem- 
bei',  and  of  the  8-inch  pipe  not  less  than  37 
miles  in  July.  123  miles  in  August,  and  the 
remainder  in  September,  I'^OO,  "liarring  strikes 
and  causes  beyond  control."  The  Columbus 
Company,  upon  the  deliver}'  of  each  invoice  at 
the  point  by  it  designated,  was  to  pay  ".spot 
cash"  therefor,  including  a  commission  of  2i^ 
per  cent,  over  the  amount  of  the  manufacturer's 
invoice.  Shipments  were  to  be  by  car  loads, 
not  exceeding  five  spliced  joints,  the  Crane  Com- 
pany paying  freight  and  other  charges  of  trans- 
portation from  the  mills  to  the  points  of  desti- 
nation; and  it  was  agi-eed  finally  that  the  pipe 
should  not  be  construed  to  be  accepted,  by  rea- 
son of  any  payments  made  therefor,  so  as  to  re- 
lieve the  Crane  Company  from  liability  on  ac- 
count of  its  defective  character,  until  the  same 
had  been  laid  and  tested  in  line,  and  proved. 

In  pursuance  of  this  contract,  the  Crane  Com- 
pany made  contracts  with  different  companies 
for  the  manufactr.re  and  shipment  of  the  re- 
quired pipe,  and  reported  the  same  for  approval 
to  the  Columbus  Company.  The  first  shipment, 
amounting  to  about  12  miles,  was  delivered,  by 
order  of  the  Columbus  Company,  to  the  Con- 
sumers" Gas  Company,  at  Chicago,  but  was  not 
used  until  two  yeirs  later,  when  it  was  shipped 
to  Indiana,  and  laid  ia  line.  In  addition,  by 
November  3,  1890.  8-inch  pipe  had  been  deliv- 
ered at  dift'erent  stations  along  the  line,  to  the 
amount  of  95.14  miles,  of  which  5.7  miles  were 
kiid  in  or  across  the  Tollcstou  Marsh,  1  mile  was 
laid  at  the  Kankakee  Marsh,  and  12.05  miles, 
in  double  lines  of  half  that  length,  were  laid 
at  Deep  River.  Further  deliveries  were  then 
suspended  by  agreement  or  mutual  consent,  un- 
til more  adequate  appliances  for  testing  the  pipe 
in  line  could  be  obtained;  the  tests  made  in 
September.  1890,  at  Deep  River,  with  an  air 
pump  of  a  capacity  of  110  pounds  to  the  siiuai-e 
inch,  having  developed  .serious  lealdng  at  as 
many  as  10  per  cent,  of  the  joints,  and  "more 
at  the  mill  end  than  at  the  field  end."  Besides 
conflicting  views  of  the  contract  liabilities  of 
the  parties,  which  were  settled  only  by  the  de- 
cision of  this  court  refened  to.  the  agents  of 
the  parties  who  were  present  at  the  tests  dif- 
fered in  respect  to  the  nature  and  cause  of  the 
defects  in  the  joints;  it  being  claimed  on  be- 
half of  the  plaintiff  in  error  that  the  pipe  was 
all  tested  at  the  mills,  and.  without  leaking, 
stood  a  pressure  of  1,000  pounds  to  the  inch, 


AVOIDANCE  OF  CONTRACT. 


235 


-and  that  the  defec-ts  devel  pi'd  in  line  were  at- 
tributable to  rough  and  c-areless  handhnti  and 
unskillful  layiutr  of  the  pipe.  On  the  contrary, 
the  representatives  of  the  deft  ndant  in  error 
asseited  a  careful  and  skillful  niauipuUition  and 
layiujtc  of  the  pipe,  and,  in  the  first  instance, 
jittributed  the  defects  to  the  liiiht  weisht  of 
the  collars,  by  reason  of  which  they  expanded 
under  pressure,  but  the  subsetiuent  employment 
of  heavier  collars  did  not  cure  the  defects; 
jind  the  later  co  iclusion  seeius  to  have  been 
reached  that  the  threads  on  the  ends  of  the 
pipe  and  in  the  collars  did  not  have  a  full  and 
uniform  tai^er.  the  fault  beiuj:  in  the  thread  of 
the  collar.  Durinji  the  eusuinir  October,  efforts 
were  made,  by  caulkiua:  and  otherwise,  to  tight- 
en the  defective  joints,  and.  tip  to  a  pressure 
of  2(HJ  pounds,  were  perhaps  substantially  suc- 
cessful: but.  about  the  2>^th  of  that  month,  high 
pressure  ptimps  w^re  brought  into  use.  which, 
at  a  pressure  of  4(X)  pounds,  reopened  some  of 
the  old  leaks,  atid  disclosed  many  new  ones. 
Further  attempts  were  then  made,  by  caulking 
and  other  means,  to  remedy  tlie  defects,  but 
with  imsiitisfactory  results,  until  November 
l.lth.  when  wintc  set  in.  and  work  was  stopped. 
On  the  other  hand,  while  there  had  been 
delays  in  the  deliverj-  of  pipe,  the  Columbus 
Company  had  not  paid  in  full  for  the  pipe 
delivered:  and  on  September  iOth  the  short- 
age had  risen  to  $139,900.  but  by  later  pay- 
ments, the  last  of  which,  in  the  sum  of  .$1.),- 
00(">.  was  made  Noveiuber  2(;th.  the  deficiency 
was  reduced  to  .?73.S(N».  These  shortages 
were  the  subject  of  correspondence,  and  of 
complaint  by  the  Crane  Company,  in  behalf 
of  which  it  is  claimed  that,  while  various  ex- 
cuses were  offered,  it  was  never  assigned  "as 
the  reason  for  not  paying  spot  cash  that  the 
pipe  was  not  satisfactory":  that  complaint 
was  once  made  by  Mr.  Yerkes.  who.  in  Oc- 
tober, had  succeeded  ^Mr.  Heiiuembourg  as 
the  representative  of  the  Columbus  Company 
in  the  transaction,  that  some  of  the  pipe  ship- 
ped by  the  Reading  Company  had  been  for- 
warded in  a  damaged  condition,  but  that,  it 
having  been  found  on  investigation  that  some 
of  the  threads  had  been  jammed  in  transit, 
the  Crane  Company  offered  to  have  all  dam- 
aged pipe  put  in  order,  and  returned  to  the 
place  of  use.  at  its*  own  expense,  and  that 
nothing  was  said  at  any  time  about  a  de- 
ficiency in  the  weight  of  the  collars,  or  about 
any  defect  other  th'in  jammed  threads:  that 
on  December  31.  1890.  Mr.  Yerkes  offered  in 
writing  to  accept  ^he  proposition  for  repair- 
ing pipe,  and  to  pay  therefor  when  returned 
and  further  inspected,  but  upon  condition 
that  the  mills  sho.ild  commence  delivery  of 
,)i|ie.  to  fill  the  balance  of  their  contracts,  on 
February  1,  1891.  and  that  the  contract  be 
modified  so  that,  instead  of  spot  cash  for  all 
pipe  delivered.  50  per  cent,  of  the  price 
should  be  paid  on  delivery,  and  the  remain- 
der after  a  test  in  line,  under  a  pressure  of 
1.0(X)  pounds  to  the  square  inch;  that  the 
Crane  Company  refused  to  accede  to  this 
(  liaiige  in  the  terms  of  payment,   and  now 


contends  that  its  proposition  to  repair  the 
damaged  threads  was  thereby  in  effect  re- 
jected by  Yerkes.  This  difference,  it  seems, 
divided  the  parties  until  January  30,  1891, 
when  ;Mr.  Verkes  telegraphed  tlie  Crane  Com- 
pany: 

"We  are  prepared  to  receive  pipe  in  accord- 
ance with  contract,  particularly  that  part 
which  provides  for  a  test  of  1,000  pounds 
when  laid.  Although  you  have  not  complied 
with  terms  of  your  contract,  we  will  receive 
pipe  if  you  commence  immediate  delivery." 
— And.  receiving  no  response,  on  February 
12.  1890,  wrote  as  follows: 

"On  the  3ijth  ult..  I  telegraphed  you  from 
New  York  as  follows:  'We  are  prepared  to 
receive  pipe  in  accordance  with  contract,  par- 
ticularly that  part  which  provides  for  a  test 
of  one  thousand  pounds  when  laid.  Al- 
though you  have  not  complied  with  terms 
of  .vour  contract,  we  will  receive  pipe  if  you 
ccmmence  immediate  delivery.'  Up  to  the 
present  time.  I  understand,  you  have  had  no 
pipe  delivered  this  year.  I  wish  to  notify 
you  that  we  cannot  wait  longer  for  the  said 
delivery,  and  will  therefore  cancel  our  con- 
tract. In  regard  to  the  pipe  that  has  already 
been  delivered,  we  are  prepared  to  make 
some  arrangement  with  you  respecting  the 
repair  of  same,  and  adjusting  the  acctnints 
now  remaining  open. 

"[Signed]  Chas.   T.  Yerkes. 

"Vice  Prest..  C.  C.  Co." 

To  that  letter,  the  Crane  Company  on  the 
same  da.v  responded  as  follows: 

"Your  young  man  brought  in  yours  of  even 
date  a  few  minutes  ago,  and  upon  its  receipt 
it  struck  me  that  there  was  no  occasion  for 
any  reply  in  view  of  all  that  has  been  said 
and  written,  but  have  since  concluded  that 
we  had  better  make  answer,  in  order  that  we 
mn.v  keep  our  record  straight.  Would  say 
that  we  answered  yours  of  .January  30th. 
from  New  York,  to  the  effect  that  we  were 
prepared  to  go  ahead  with  your  pipe  line  con- 
tract on  the  conditions  of  .said  contract,  and 
we  are  now  prepared  to  do  so.  But  you 
have  persistently  rpquested  that  we  go  ahead 
on  the  contract  upon  terms  dilTerent  from 
The  contract,  and  this  we  have  persistently 
refused,  and  now  refuse,  to  do.  We  Have 
simply  demanded  that  you  carry  out  your 
part  of  the  contract,  and  desire  now  to  noti- 
fy you  that,  if  .vou  cancel  this  contract,  you 
do  so  at  your  peiil.  and  we  will  hold  you  re- 
sponsilde  for  the  results.  We  have  not  de- 
livered any  of  the  pipe  this  year,  because 
you  have  not  asked  us  to  deliver  it.  and  be- 
cause you  have  not  complied  with  your  part 
of  the  contract.  We  have  been,  as  we  are 
now,  awaiting  your  orders  to  go  on  with  the 
contract,  and  will  do  so  when  you  comply 
with  your  part  of  the  contract. 

"[Signed]  Crane  Company. 

"R.  T.  Crane.  Prest." 

In  the  following  March.  Mr.  He<iuembourg 
resumed  cliarge.  and  reaching  the  conclusion, 
after  some  further  tests,  that  the  collars  fur- 


2:36 


AVOIDANCE  OF  CONTRACT. 


nislipfl  by  the  Crnne  Company  weiv  too 
light,  procurod  heavier  eolhirs.  at  an  expense 
for  those  used  upon  the  Crane  Company's 
pipe  of  ifl04.(MM).  and  proceeded  to  hiy  the 
line,  usins  the  Crane  pipe  so  far  as  it  went; 
the  total  extra  expense  alleged  to  have  been 
incurred  in  making  that  pipe  available  being 
the  sum  of  .i^-JOO.fKH),  most  of  wliich  the  plain- 
tiff in  error  insists  was  inciirred  by  reason 
of  the  false  theory,  negligently  adopted  and 
pursued,  that  the  Crane  collars  were  too 
light.  The  line  v>-as  finished  and  turned  over 
to  the  Indiana  company  late  in  189:2.  The 
defective  taper  in  the  threads  of  the  collars, 
it  is  asserted  by  the  plaintiff  in  error,  was 
not  discovered  until  just  before  the  trial  of 
this  case,  which  was  commenced  December 
3,  1804.  and  therefore  could  not  have  been 
the  ground  for  the  rejection  of  the  pipe.  The 
suit  was  commenced  May  23,  1891,  the  decla- 
ration being  framed  as  "of  a  plea  of  trespass 
on  the  case  upon  promises."  and  charging,  in 
substance,  that  the  pipe  was  made  of  imper- 
fect iron,  and  was  incapable,  when  tested  in 
line,  of  standing  the  required  pressure,  and 
that  the  threads  upon  the  pipe  and  in  the  col- 
lars did  not  have  a  uniform  taper.  The 
plaintiff  in  error  tendered  the  general  issue, 
with  notice  of  special  matter.  The  trial  re- 
sulted in  a  verdict  and  judgment  in  the  sum 
of  $48,000  for  the  defendant  in  error.  Nu- 
merous error's  are  assigned,  but  the  ques- 
tions to  be  considered  are  comparatively  few. 

Evidence  of  certain  tests  made  of  the  pipe 
in  line  Avas  admissible  to  show  the  quality 
and  value  of  the  pipe  delivered  as  compared 
with  that  contracted  for:  and  if  the  tests 
were  made  without  notice  to  the  plaintiff'  in 
error,  and  not  within  a  reasonable  time  after 
delivery  of  the  pipe,  the  value,  but  not  the 
com]"»etency.  of  the  testimony,  was  att'ected 
by  those  circumstances. 

Upon  the  question  whether  the  pipe  was 
handled  carefally  and  properly  laid,  wit- 
nesses who  supervised  or  participated  in  the 
work  were  permitted  to  testify  "hat.  in  their 
opinion,  the  workmen  w'ere  skillful,  and  the 
work  well  done.  It  was  competent,  we 
think,  to  shov/  that  men  of  experience  and 
skill  were  employed  upon  the  work;  and 
doubtless,  in  such  a  case,  a  Avitness  may  be 
required  to  state  what  defect,  if  any.  he  saw 
in  the  work,  or  what  carelessness  or  lack  of 
skill  in  the  manner  of  its  execution;  but  the 
gt'ueral  question  whether  the  line  or  lines  of 
pipe  in  question  had  been  laid  with  proper 
skill  and  care  was  not  one.  we  think,  to  be 
df^termined  upon  the  opinions  of  witnesses. 
Among  the  cases  cited  to'iching  the  point  are 
Provision  Co.  v.  Baier.  20  111.  Ap]).  ^TG;  Kail- 
rond  Co.  v.  Clark.  108  111.  113:  Morris  v. 
Town  of  East  Haven.  41  Conn.  2~)2:  Turn- 
pike Co.  V.  Coover.  20  Ohio  St.  .")2(). 

.\  more  serious  question  has  arisen  upon 
the  admission  of  testimony  to  shoAv  the  cost 
of  taking  up.  repairing,  and  relaying  of  pipe 
at  Deep  Kiver.  Tolleston.  and  Kankakee. 
Proof  was  made  tliat  in  1891  aud  isiii,  after 


the  bringing  of  this  suit,  the  Columbus  Com- 
l-any,  having  determined  to  make  use  of  the 
pipe  which  had  been  delivered,  took  up  what 
had  been  laid,  removed  the  Crane  collars,  re- 
threaded  such  pipe  as  had  been  bent  or 
caulked,  put  on  heavier  collars,  and  relaid 
Ihe  pipe  where  it  had  been  before.  The  men 
employed  in  doing  this  work  were  at  the 
same  time  engaged  in  other  work,  and  no 
separate  account  v\-as  kept  of  the  labor  and 
expense  incident  to  the  changing  of  the  col- 
lars, and  rethreadiug  aud  relaying  of  the 
pipe  received  of  the  Crane  Company.  The 
excuse  offered  is  that  it  coiild  not  be  done 
with  economy.  On  direct  examination.  Mr. 
Hequembourg,  testif.ving  for  his  company, 
stated  that  the  cost  per  foot  of  taking  up  and 
relaying  the  pipe  was  .$1.50  at  Tolleston,  75 
cents  at  Deep  River,  and  at  Kankakee  $1. 
1  he  cross-examination  showed  that  these 
were  mere  estimates,  prepared  without  per- 
sonal knowledge  of  the  facts,  from  reports 
which  were  not  designed  for  the  purpose, 
and  contained  no  data  to  enable  him  to  reach 
a  definite  and  just  conclusion.  These  esti- 
mates were  clearly  incompetent.  They  were 
mere  guesses  by  a  witness  interested  to  make 
the  figures  large.  He  testified  that  it  was 
liis  "particular  business  to  ascertain  what 
was  a  fair  amount  to  charge  the  defendant 
for  changing  the  collars  and  reconstructing 
the  line";  aud.  that  being  so.  he  should  have 
kept,  or  caused  to  lie  kept,  accurate  and  dis- 
tinct accounts  of  the  labor  and  expense  as 
the  work  progressed,  and  should  not  have 
been  allowed  to  give  to  the  jur.v,  as  the  re- 
sult of  a  calculation  the  basis  of  w'nich  was 
not  shown,  the  very  large  sum  mentioned, 
and  then  to  testify,  as  he  did,  that  that  sum 
was  the  reasonable  cost  of  the  several  items 
inchided  in  the  estimate.  Such  evidence 
does  not  become  competent,  under  ordinary 
circumstances,  because  bettor  evidence  may 
not  be  at  hand. 

Error  Is  also  assigned  upon  the  exclusion 
of  evidence  offered  by  the  plaintiff  in  en-or 
for  the  purpose  of  showing  that  useless  and 
rmreasonable  expense  had  been  incurred  by 
the  defendant  in  error  in  its  efforts  to  make 
the  pipe  confonn  to  the  specifications,  fulfill 
the  conditions,  and  stand  the  tests  I'equired 
by  the  contract.  The  Columbus  Company 
was  engaged  in  laying  a  pipe  line,  not  direct- 
l.v  for  its  own  use.  but  for  the  Indiana  Com- 
pany, with  which  it  had  made  the  contract 
of  .Tune  5.  1890.  By  an  act  of  Ihe  Indiana 
legislature  apiu'oved  ilarch  4.  1891.  regulat- 
ing the  mode  of  procuring,  transporting,  and 
using  natural  gas,  the  use  of  more  than  nat- 
ural pressure  or  an  artificial  pressure  exceed- 
ins  .'UK)  pounds  to  the  s(iuare  inch  was  for- 
bidden; and  by  a  decision  of  the  supreme 
court  of  that  state,  handed  down  .Tune  20. 
1891.  the  act  had  bees  declared  constitution- 
al. Jamieson  v.  Oil  Co..  128  Ind.  .5.55.  28  N. 
E.  70.  The  defendant  in  error  and  the  Indi- 
ana Company  were  joint  parties  to  that  suit, 
and.  as  a  result  of  th(>  decision,  they  modi- 


AVOIDAXrE  OF  CONTRArT, 


237 


•fled  their  contract  so  as  to  ri  (luirt-  tlic  pipt' 
ii.nd  collar  to  be  tested  at  the  mill  luuler 
l.nCKJ  pounds  hydraulic  pressiu'e,  and.  when 
laid,  to  stand,  for  24  consecutive  hours,  a 
w'orkiu.s  pressure  of  4()0  pounds  to  the  scjuare 
inch,  without  manifest  or  material  defects, 
or  leaka^'e  exceedinj;  10  per  cent,  of  its  total 
storage  capacity;  the  ■  tests  to  be  made  in 
, five-mile  sections,  as  soon  as  each  section 
should  be  completed.  The  plaintiff  in  error 
offered  to  put  the  contract  and  the  modilica- 
tion  in  evidence,  and  asked  the  court  to  give 
to  the  jury,  at  the  proper  time,  an  instruc- 
tion which,  after  referring  to  the  Indiana 
statute  and  other  relevant  and  undisputed 
facts,  proceeded  as  follows: 

"If,  therefore,  the  jury  tind  from  the  evi- 
dence that  the  pipe  delivered  to  the  plaintiff 
by  the  defendant  under  its  contract,  prior  to 
the  commencement  of  this  action,  was  of  suffi- 
cient structural  strength  to  stand  a  working 
line  pressure  ot  three  hundred  pounds  to  the 
square  inch,  and  also  that  the  threading  and 
taper  conformed  to  the  specifications  of  the 
contract,  so  that  the  line,  when  constructed, 
was  sufficient  for  the  transportation  of  the 
gas  at  the  pressure  of  three  hundred  pounds, 
as  limited  by  law;  and  if  you  further  believe 
that,  after  the  commencement  of  tliis  action, 
the  plaintiff  unreasonably  and  unnecessarily 
expended  money  in  the  purchase  of  new  coup- 
lers, and  in  exchanging  such  new  couplers  for 
the  old.  for  the  alleged  purpose  of  construct- 
ing a  line  that  would  stand  a  pressure  of  a 
thousand  poimds  to  tht  square  inch;  and  if 
you  further  believe  from  the  evideuca  that 
such  expenditiire  was  uni'easouable  and  un- 
necessary.— then  the  court  instructs  yoti  that 
you  should  not  find  for  the  plaintiff  as  dam- 
ages the  amount  of  money  so  expended." 

We  are  of  the  oxjinion  that  the  evidence 
should  have  been  admitted  and  the  instruc- 
tion given.  By  the  general  rule  governing  the 
measure  of  damages  for  a  breach  of  warranty 
in  the  sale  of  chattels,  the  defendant  in  error, 
having  paid  the  entire  purcha.se  price,  was  en- 
titled to  reclaim  a  .sum  equal  to  the  difference 
in  value  between  the  pipe  delivered  and  pipe 
of  the  quality  warraated;  and  if,  at  the  time 
of  delivery,  it  remained  necessary  or  desir- 
able, and  was  practicable,  by  a  reasonable 
expenditure,  to  bring  the  pipe  up  to  the  re- 
quirements uf  the  contract,  it  was  the  privilege 
of  the  defendant  in  error  to  make  the  ex- 
penditure n-^cessary  for  that  purpose,  and  to 
exact  reimbursement  of  the  Crane  Company, 
instead  of  resorting  to  the  proof  of  compara- 
tive values.  But  if.  as  the  proposed  instruc- 
tion assumes,  the  pipe  met  the  requirements 
of  the  modified  contract  with  the  Indiana  Com- 
pany, and.  by  reason  of  the  Indiana  statute,  a 
pipe  capable  of  bearing  a  pressure  of  more 
than  oiM)  pounds  was  not  needed,  then,  mani- 
festly, it  was  unreasonable  to  expend  time  or 
money  in  an  eft'ort  to  impart  to  the  pipe  a 
degree  of  strength  which  could  be  of  no  prac- 
tical utility.  Under  such  circumstances,  the 
ordinary  rule  should  prevail,  and  the  recovery 


I  shoi'.ld   be  on   the   basis  of  the  difference  of 

I  value  between  the  article  delivered  and  that 
which  ought   to  have   been   delivered,— to   be 

i   determined   by   the  market  prices,   or.   if  that 

;  should  be  impracticsible.  then,  probably,  by 
the   difference   in    cost   of   proeluction    at    the 

[  mills;  certainly  not  by  the  cost  of  repair  or 
reconstruction    in    or    along    the    trenches    in 

I  which  the  pipe  was  to  be  laid,  where  neces- 
sarily the  work  would  be  more  difficult  and 

j  expensive  than  at  the  mills.  The  instruc- 
tion a.'^ked  was  hypothetical,  leaving  to  the 
jury  to  determine  whether  the  facis  were  as 
supposed,  and  whether  the  expenditures  in 
(luestion  were  reasonable,  and  if  the  nicdi- 
tied  contract  with  the  Indiana  Company  had 
been  admitted  in  evidence,  the  instruction 
would  have  been  pertinent  and  proper  to  be 
given.  The  statute  of  Indiana,  and  the  deci- 
sion of  the  supreme  court  of  that  state  where- 
by it  was  declared  coLstitutioual.  were  mat- 
ters of  judicial  cognizance,  in  respect  to  which 
formal  proof  was  unnecessary.  Among  the 
authorities  cited  touching  the  measure  of  dam- 
ages in  such  cases,  besides  the  texts  of  I'ar- 
sons,  Sedgwick.  Sutherland,  and  Addison,  are 
the  following:    Maish  v.  Mcl'herson.   105  U. 

I  S.  71G;    U.  S.  V.  Behan,  110  U.  S.  3:-!'.),  4  Sup. 

I  Ct.  SI;  Blacker  v.  Slown,  114  Ind.  :J_'2,  m  N, 
E.  021;  Smith  v.  Dunlap.  12  111.  184;  Millei 
V.  Mariners'  Chinch,  7  Me.  ol;  Le  Blanche  v. 
Railroad  Co..  1  C.  P.  Div.  280;  Hamilton  v. 
McPlierson,  28  N.  Y.  72;  Frick  Co.  v.  Falk 
(Kan.  Sup.)  32  Pac.  300:  Loomer  v.  Thomas 
(Neb.)  50  X.  W.  973;  Lake  Co.  v,  Elkius,  ^4 
Mich.  439;  Bradley  \.  Denton.  3  Wis.  557; 
Dillon  V.  Ander.son.  43  N.  Y,  231;  Muller  v. 
Eno.  14  X.  Y.  .597;  Passinger  v.  Thorljurn,  34 
X.  Y.  (j34;  King  v.  Barnes.  109  X.  Y.  207,  10 
X.  E.  332;  Fisk  v.  Tank,  12  Wis.  270;  Brown 
V.  Bigelow.  10  Allen,  242;  Medbury  v.  Wat- 
son. 0  Mete.  (Mass.)  240. 

But  the  question  which  is  most  earnestly  dis- 
puted is  whether,  in  respect  to  the  pipe  deliv- 
ered and  retained,  the  defendant  in  eiTor,  by 
reason  of  its  refusal,  in  the  letter  of  Februaiy 
12,  1890,  to  accept  further  deliveries  under  the 
contract,  is  debarred  of  the  right  to  sue  for  a 
breach  of  the  warranty  of  quality.  It  is  in- 
sisted that  the  refusal  to  accept  more  pipe 
was  justified  by  the  bad  quality  of  that  re- 
ceived, the  presumption  being  under  the  cir- 
cumstances that  further  deliveries,  coming 
from  the  same  mills,  would  be  of  the  same 
bad  quality.  That  was  a  question  of  fact, 
which,  if  the  evidence  was  sufficient,  should 
have  been  left  to  the  jury;  but  it  is  to  be  ob- 
served that  the  refusal  was  not  put  upon  that 
ground,  but  on  the  ground  that  no  pipe  had 
been  delivered  recently,  though  no  order  or 
request,  with  a  designation  of  the  place  for 
such  delivery,  had  been  made.  On  the  facts 
as  presented  in  the  briefs,  beyond  which  we 
have  not  looked,  it  does  not  appear  that  there 
was  an  adequate  excuse  for  the  refusal  to  ac- 
cept further  perf  rrmance  of  the  contract;  but, 
whether  there  was  or  not,  it  was  the  right  of 
the  plaintiff"  in  error  to  have  the  case  submit- 


J38 


AVOIDANCE  OF  CONTRACT, 


ted  to  tlu>  jury  upon  the  hypothesis  that  noth- 
ing had  been  done  to  justify  a  termination  of 
the  contract  by  the  defendant  in  error;  and 
on  tliat  basis,  whether  other  modes  of  relief 
Avere  available  or  not,  we  tliink  it  clear  that 
the  defendant  in  error  can  have  no  remedy  in 
an  action  upon  tlie  contract.  It  cannot  at  one 
and  tlie  same  time  repudiate  an  executory  con- 
tract like  this  in  respect  to  a  i^art  of  the  sub- 
ject-matter, and  in  respect  to  other  parts  in- 
sist upon  its  enforcement.  If  the  declaration 
hatl  disclosed  such  a  breach  or  unexcused  re- 
pudiation of  tlie  contract  by  the  plaintilT,  it 
would  have  been  plainly  demurrable.  Only 
upon  the  theory  that  the  Crane  Company  had 
been  guilty  of  a  breach  or  breaches  which  jus- 
tified the  other  party  in  refusing  further  per- 
formance Avas  the  action  maintainable  as 
brought;  and  yet  from  the  damages  which 
the  jm-y  Avas  directed  to  award  the  plaintiff, 
on  account  of  the  defective  quality  of  the  pipe 
delivered,  a  deduction  was  authorized  of  the 
amount  of  commission  which  that  company 
would  have  earned  if 'it  had  been  permitted 
to  deliver  the  remainder  of  the  pipe,  and  a 
further  deduction  on  account  of  a  decline  in 
the  market  price  of  pipe.  If  the  conduct  of 
the  Crane  Company  was  such  as  to  justify  a 
refusal  of  the  otlier  party  to  receive  fiu'ther 
deliveries,  it  was  entitled  to  no  profit  thereon 
by  way  of  commission  or  otherwise  (U.  S.  v. 
Behan.  110  U.  S.  339.  4  Sup.  St.  81);  and  just 
as  if  the  contract  had  been  terminated  by 
agreement,  or  as  if  the  pipe  delivered  had  been 
the  total  amount  called  for  by  the  contract, 
the  Columbus  Comnany  was  entitled  to  re- 
cover undiminished  damages,  equal  to  the  dif- 
ference in  value  between  the  pipe  delivered 
and  pipe  of  the  stipulated  quality. 

It  is  not  a  case  of  rescission.  That  re(iuires 
the  placing  of  both  parties  in  statu  quo.  and  in 
this  case  would  have  involved  a  return,  or  at 
least  a  tender  back,  of  the  pipe  which  had 
been  received.  Neither  is  it  a  case  of  i'efu.sal 
to  receive  particular  lots  of  pipe,  offered  for 
delivery,  because  the  same  was  visibly,  or, 
upon  immediate  inspection,  was  found  to  be, 
defective.  The  rejection  of  such  pipe,  before 
placing  it  in  line,  would  not  have  been  an  act 
either  of  rescission  or  repudiation,  but  rather 
of  enforcement  of  the  contract.  Barrie  v. 
Earle,  143  Mass.  1,  5,  8  N.  E.  639;  Norrington 
V.  Wright,  11.5  U.  S.  188,  6  Sup.  Ct.  12;  Pope 
V.  AUis,  115  U.  S.  363,  6  Sup.  Ct.  69.  But 
upon  the  hypothesis  of  the  proposed  instruc- 
tion, which,  together  with  the  evidence  of- 
fered in  support  of  it,  ought,  as  we  think,  to 
have  been  submitted  to  the  jury,  it  is  simply 
a  case  where,  under  a  contract  of  sale  which 
is  executory  and  entiie,  the  vendee  repudiates 
the  contract  in  respect  to  a  part  of  the  goods, 
and  in  respect  to  the  remainder  seeks  to  en- 
force it.— a  proposition  which,  we  believe,  is 
supported  neither  by  reason  nor  precedent. 
The  earlier  cases  touching  the  general  subject, 
both  English  ana  American,  are  collected  in 
the  notes  ro  Cutter  v.  Powell,  2  Smith.  Lead. 
Cas.  17-.">3;   and  while,  in  some  respects,  there 


has  been  a  contrariety  of  ruling,  no  case  lias 
been  cited  which  is  perceived  to  be  inconsist- 
ent with  our  present  conclusion.  The  case  of 
Norrington  v.  Wright,  supra,  was  not  in  fact 
a  case  of  rescission,  though  partially  so  treat- 
ed. It  Avas  a  suit  by  the  vendor,  seeking  dam- 
ages of  the  A-endees  on  account  of  their  refusal 
to  accept  consignments  of  old  T  rails,  Avliich. 
by  the  contract,  Aveie  to  be  shipped  1,000  toiis^ 
per  month,  to  the  total  number  of  5,000  tons., 
^rhe  vendees  accepted  and  paid  for  4(M3  tons, 
received  in  one  consignment,  but  afterAvards. 
learning  that  the  (piantities  sliipped  during 
three  months  did  not  correspond  Avith  the  re- 
(luireiuent  of  the  contract,  refused  to  accept 
or  pay  for  any  more.  The  court  held  the  con- 
tract to  be  entire,  and  the  specification  of  the 
quantity  to  be  delivered  each  mouth  to  be 
descriptive  of  the  goods,  a  departure  from 
which  through  three  months  "justified  the  de- 
fendants in  rescinding  the  Avhole  contract,  pro- 
Aided  they  distinctly  and  seasonably  assert- 
ed the  right  of  rescission";  and  their  retention 
of  the  400  tons  received  in  February,  it  Avas 
said,  "was  no  AA'aiA'er  of  this  right,  because 
it  took  place  Avithout  notice  or  means  of 
knoAvledge  that  the  stipulated  quantity  had 
not  been  shipped  in  February.  The  price  paid 
by  them  for  that  cargo  being  above  the  market 
value,  the  plaintiff  suffered  no  injury  by  the 
omission  of  the  defendants  to  retiu'n  the  iron; 
and  no  reliance  was  placed  on  that  omission 
in  the  coi'respondeuce  betAA'een  the  parties. "' 
To  make  that  case  like  this,  on  the  theory  of 
rescission,  it  is  necessary  to  reverse  the  par- 
ties, and  to  suppose  that  the  vendees,  after 
receiving  and  paying  for  the  400  tons  shipped 
in  February,  had  learned  at  once  that  no  more 
had  been  shipped  during  that  month,  and  hav- 
ing on  that  account  refused  to  receive  further 
consignments,  even  though  offered  in  conform- 
ity Avith  the  contract,  had  brought  suit  for 
damages  for  the  failure  of  the  vendor  to  ship 
1,000  tons  in  February,  instead  of  the  400  tons 
recelA'ed  and  retained.  If  that  had  been  the 
case,  it  would  hardly  have  been  said  that  the 
keeping  of  the  400  tons  was  not  a  waiver  of 
the  right  of  rescission.  The  case  is  expressly 
distinguished  from  Lyon  v.  Bertram,  20  Hoav. 
149;  and  the  projiosition  is  announced,  AAiiich 
alone  and  independently  of  the  doctrine  of 
rescission  was  sufficient  to  disjiose  of  the  suit, 
that  "the  plaintiff,  denying  the  defendant's 
right  to  rescind,  and  asserting  that  the  con- 
tract Avas  still  in  force,  Avas  bound  to  shoAv 
such  performance  on  his  part  as  entitled  him 
to  demand  performance  on  their  part,  and, 
having  failed  to  do  so,  cannot  maintain  this 
action."  The  principle  of  that  proposition  is 
applicable  here.  Having  repudiated  the  con- 
tract in  part,  the  defendant  in  error  had  no 
right  to  ask  its  enforcement  in  another  part. 
See  Clark  v.  Steel  AVorks,  3  C.  C.  A.  600.  53 
Fed.  494,  and  3  U.  S.  App.  358.  In  Pope  v. 
Allis,  1 15  U.  S.  3t)3,  6  Sup.  Ct.  69.  the  contract 
was  for  the  sale  of  500  tons  of  American  iron 
and  300  tons  of  Scotch  iron,  which  the  seller 
undertook  to  shii)  to  the  buyer.     The  contro- 


AVOIDANCE  OP  CONTRACT. 


2:39 


versy  was  coucerning  the  American  iiou  aloue, 
which,  after  (lelivery  at  Milwaukee,  the  pur- 
chaser refused  to  accept,  on  the  ground  that  it 
was  not  of  the  grade  called  for  by  the  con- 
tract, and,  having  notitied  the  seller  tliat  the 
iron  was  held  subject  to  his  order,  brought  suit 
to  recover  the  price  which  had  been  paid  for 
the  iron  and  the  freight  thereon.  The  point 
decided  was  that,  the  juiy  having  found  that 
the  iron  was  not  of  the  quality  which  the  con- 
tract required,  "on  that  ground  the  defendant 
in  error,  at  the  tiist  opportunity,  rejected  it,  as 
he  had  a  right  to  do."  The  syllabus  couples, 
with  the  right  to  reject,  the  right  to  '"rescind 
the  sale."'  but  that  is  taken  from  the  court's 
statement  of  a  general  proposition  of  law  in 
respect  to  sales  by  sample.  When  the  entire 
subject  of  a  contract  of  sale  is  rejected,  it 
amounts  to  a  rescission  of  the  contract;  but 
when  a  part  of  the  subject  is  accepted,  and 
another  part  rejected,  because  not  of  the  qual- 
ity contracted  for,  it  is  not  a  rescission.  In 
Pope  V.  Allis  it  does  not  appear  whether  or  not 
the  Scotch  iron  included  in  the  contract  was 
received  by  the  purchaser.  If  not.  then  the 
case  was.  as  it  seems  to  have  been  treated,  the 
same  as  if  the  American  iron  aloue  had  been 
the  subject  of  the  sale,  and  the  rejection  of 
the  iron  was  a  rescission;  but,  if  the  Scotch 
iron  was  received  and  retained,  it  was  not  a 
rescission,  but  simply  a  rejection  of  the  Ameri- 
can iron,  on  the  gmiud  stated,  that  "the  ven- 
dee cannot  be  obliged  to  receive  and  pay  for  a 
thing  different   from   that   for  which  he  con- 


1  tracted";    just  as  the  defendant  in  error  here 
j  was  not  bound  to  receive  a  shipment  of  pipe 
I  which  was  visibly  below  the  contract  stand- 
j  ard,  though  »^he  test  provided  for  was  to  be 
!  made   when   the  pipe  was  in  line.     But,   un- 
I  der  this  contract,  the  vendor  would  have  had 
the  right,   within   a   reasonable   time,   to   fui- 
nish.  in  lieu  of  pipe  so  rejected,  other  pipe  of 
the   required    cpiality;     while    in   the   case    of 
I'ope   V.   Allis  such   right  of  substitution  was 
not  contemplated,   and   probaljly  did  not   ex- 
ist.    In  (ierman  Sav.  Inst.  v.  De  La  Vergne 
Refrigerating  Macli.   Co.,  17  C.  C.  A.  34,  70 
Fed.  14(!,  the  rule  that  rescission  must  De  total 
is  strongly  stated,  and  numerous  authorities 
are  cited.     Many  cases  have  been  cited  which 
afford  little  aid   to  the  decision   of  this  one, 
because  they  grew  out  of  completed  deliveries, 
and    involved   no   question  of   partial   or   im- 
perfect  performance   by  the  party   who    was 
seeking  a  remedy  upon  the  contract.     In  Cher- 
I  ry  Valley  Iron  Co.  v.  Florence  Iron  River  Co., 
!  12   C.   C.   A.   306,   61  Fed.   509.   the  contract, 
which  was  for  the  sale  of  a  quantity  of  ore 
to  be  delivered  and  paid  for  monthly,  is  broad- 
ly distinguished  from  the  present  contract  by 
the    single    provision    that,    if    the    purchaser 
failed  to  pay  as  agreed,  the  seller  should  have 
the  right  to  cancel  the  contract  in  respect  to 
ore  not  delivered  at  the  time  of  the  default  in 
payment. 

The  judgment  below  is  reversed,  and  the 
cause  remanded,  with  instruction  to  grant  a 
new  trial. 


240 


A  \0 1  DANCE  OF  CONTRACT. 


ILLINOIS  LEATHER  CO.   v.   FLYNN. 
(Go  N.  W.  r.l').) 
Supremo  Court  of  Michigan.      Dec.  30.  ISO."). 

Error  to  circuit  court,  Wayne  county;  Jo- 
seph W.  Donovan,  Judge. 

Replevin  by  tlie  Illinois  Leather  Company 
against  William  H.  Flyun.  receiver  of  W.  A. 
Bourke  &  Co.  There  was  a  judgment  for 
defendant,  and  plaintiff  brings  error.  Affirm- 
ed. 

Willis  G.  Claik.  for  appellant.  Frank  D. 
Andrus  (John  D.  Conely,  of  counsel),  for  ap- 
l)ellee. 


MONTGOMERY.  J.  Defendant  was  appoint- 
ed receiver  of  the  property  covered  by  a  chat- 
tel mortgage  given  by  W.  A.  Bourke  &  Co.  to 
the  City  Savings  Bank  of  Detroit.  Plaintiff, 
by  permission  of  the  court,  brought  replevin 
against  the  receiver  for  1,001  bales  of  hair 
ordered  of  plaintiff  February  10,  189.5,  and 
shipped  to  Bourke  &  Co.  April  1.5,  1895.  On 
the  trial,  plaintiffs  contended  that  the  goods 
were  bought  and  sold  by  Bourke  &  Co.,  un- 
der circumstances  raising  a  presumption  that 
they  received  the  goods,  having  formed  the 
intention  of  not  paying  for  them,  or  at  least 
under  circumstances  that  show  that  a  man 
of  ordinary  prudence  would  have  known  that 
he  could  not  have  continued  the  business  un- 
til the  maturity  of  plaintiff's  claim;  and  the 
chief  contention,  as  made  in  this  court,  is 
that,  under  such  circumstances,  a  purchase 
is  to  be  deemed  fraudulent  in  law.  We  think 
the  law  is  otherwise.  It  is  not  the  law  that, 
though  a  dealer  is  insolvent,  he  is  guilty  of 
fraud  if  he  continues  to  purchase  goods,  if  he 
buys  in  good  faith,  and  in  the  expectation  of 
continuing  in  the  business.     He  is  not  bound 


to  abandon  hope.  It  is  true  there  is  a  class 
of  cases  in  which  it  has  been  held  that, 
where  the  natural  effect  of  the  acts  of  the 
party  is  to  work  a  fraud  against  another,  the 
absence  of  an  intent  to  defiaud  is  not  a 
defense;  but  it  is  not  a  fraud  i»er  se  for  a 
purchaser  of  goods  to  fail  to  make  payment, 
nor  is  it  a  fraud  per  se  for  a  dealer  to  pur- 
chase goods,  though  insolvent,  in  the  absence 
of  any  misrepresentation,  and  with  the  in- 
tention of  paying  for  them;  nor  does  the  fact 
of  a  subsequent  failure  make  the  purchase 
fraudulent  by  relation.  What  constitutes 
fraud  in  such  a  case  is  the  purpose  of  the 
buyer  not  to  pay  for  the  goods.  This  is  not 
determined  by  what  purpose  some  other  less 
hopeful  of  success  in  his  ventures  might  un- 
der like  circumstances  have  entertained;  but. 
to  constitute  the  purchase  fraudulent  on  this 
ground,  there  must  have  been  an  actual  in- 
tent on  the  part  of  the  purchaser  to  obtain 
the  goods  without  paying  for  them.  Tied. 
Sales,  §  107,  and  cases  cited;  Morris  v.  Tal- 
cott.  9G  N.  Y.  100;  Doyle  v.  Mizner,  40  Mich. 
Kil;  Edson  v.  Hudson,  83  Mich.  4,50,  47  N. 
W.  347.  The  circuit  judge  in  the  present 
case  withdrew  the  question  of  fact  from  the 
jury.  An  examination  of  the  testimony  sat- 
isfies us  that  there  was  no  error  in  this. 
While  there  was  testimony  which  might  be 
construed  as  showing  the  insolvency  of 
Bourke  &  Co.,  as  we  have  pointed  cut,  this 
fact  alone,  if  established,  would  not  have  jus- 
tified a  verdict  for  the  plaintiff.  There  was 
no  proof  of  any  misrepresentation,  nor,  as 
we  think,  was  there  any  testimony  tending 
to  show  a  preconceived  purpose  of  obtaining 
these  goods,  and  avoiding  payment  therefor. 
The  judgment  will  be  affirmed. 

McGRATH,   C.  J.,  did  not  sit.     The  other 
justices  concurred. 


AVOIDAN'CE  OF  CONTRACT. 


241 


PETERS   BOX   &    LUMBER   CO.   v.   LESH 

ot   al. 

(20  N.  E.  291,  119  Iiul.  98.) 

Supreme  Court  of  ludiuiiu.    Feb.  21,  1889. 

Appeal  from  circuit  court,  Huntington 
county;    Henry  B.  Sayles,  Judge. 

Action  of  replevin  against  the  Peters  Box 
H&  Lumber  Company  by  W.  H.  and  J.  A. 
X,esh,  to  recover  certain  lumber.  Judgment 
for  plainti£f.s,  and  defendant  appeals. 

A.  Zollars,  H.  Colerick,  and  W.  S.  Oppen- 
Ilieim,  for  appellant.  F.  W.  Rawles  and  T.  E. 
ElllSDU,  for  appellees. 

COFFEY,  J.  This  action  was  brought  by 
the  appellees  against  the  appellant  in  the 
Allen  circuit  court,  to  recover  certain  lumber 
and  logs  described  in  the  complaint.  The 
cause  was  put  at  issue  by  a  general  denial, 
.and  the  venue  was  changed  to  the  Hunting- 
ton circuit  court.  The  cause  was  tried  by  a 
jury,  who  returned  a  verdict  for  the  appel- 
lees, assessing  the  value  of  the  property  at 
$270.  Motion  for  a  new  trial  overruleil  and 
-excepted  to,  and  judgment  on  the  verdict. 

The  errors  assigned  in  this  court  are:  (1) 
That  the  Huntington  circuit  court  had  no  ju- 
risdiction over  the  cause;  (2)  that  the  court 
•erred  in  overruling  the  motion  for  a  new 
irial.  No  point  is  made  in  the  brief  of  coun- 
sel for  the  appellant  on  the  first  assignment 
•of  error,  and,  therefore,  the  same  is  waived. 
The  evidence  on  tlie  part  of  the  appellees 
tends  to  prove  that  the  appellant  is  a  cor- 
[)oration  carrying  on  a  large  saw-mill  and 
lumber  business  at  the  city  of  Fort  Wayne, 
Ind.;  that  the  appellees,  in  November,  1SS3, 
had  been  and  were  operating  a  saw-mill  at 
Sidney,  Kosciusko  county,  Ind.;  that  a  man 
calling  himself  Milliard  came  to  Sidney,  and 
represented  to  the  appellees  that  he  was  the 
agent  of  the  appellant,  to  buy  lumber  and 
logs  for  it.  The  appellant  had,  before  that, 
to  the  knowledge  of  the  appellees,  bought 
such  property  in  that  vicinitj-,  and  they  sup- 
posed he  was  such  agent.  One  of  the  appel- 
lees went  with  the  said  Milliard  to  several 
places,  where  he  bought  logs  for  the  appel- 
lant, and  they  finally  sold  him,  as  the  agent 
of  appellant,  the  property  in  question,  for 
$203.  By  their  agreement,  it  was  to  be 
measured,  put  on  the  cars,  the  measurement 
to  be  sent  to  the  appellant  and  it  to  imme- 
diately pay  the  bill  by  a  draft  on  New  York. 
The  property  was  measured,  .sold,  and  ship- 
ped on  Monday,  and  Milliard  left  Fort 
Wayne  on  Tuesday.  The  draft  not  coming, 
one  of  the  appellees  went  to  Fort  Wayne  on 
Tuesday,  where  he  met  Mr.  Papa,  the  appel- 
lant's president,  and  asked  him  to  pay  for 
said  propert}^  Papa  denied  the  authority 
of  Milliard  to  act  for  the  appellant,  and, 
■after  demand,  refused  to  deliver  the  proper- 
ty, and  also  refused  to  say  much  about  the 
contract  of  appellant  with  Milliard,  or  to 
say  how  much  he  had  been  jiaid  for  the 
■property.      The    appellant    did    in    fact    pay 

yAN  ZIIiE  SEL.CAS.S.VLES — 16 


Milliard  .'^12.5  for  the  property  in  controver- 
sy. Immediately  after  the  delivery  of  the 
property  to  it  by  Milliard,  the  appellant  com- 
menced to  saw  up  the  logs  and  mix  the  lum- 
ber with  its  own.  Up  to  this  point  there 
seems  to  be  no  disagreement  alxnit  the  facts. 
It  is  claimed  by  the  appellant  that  bills  of 
lading  were  made  out  for  the  property  In 
the  name  of  Milliard,  with  the  consent  of 
one  of  the  appellees,  but  this  fact  is  disputed 
by  the  aiipelleos,  who  claim  that  there  was 
notliing  m:ule  out  at  the  freiglit  office  from 
which  the  property  was  shipped  except  a  re- 
ceipt for  the  property. 

The  court  gave  to  the  jury  the  following 
instruction:  "Should  you  find  from  the  evi- 
dence that  the  title  and  right  to  possession 
of  the  property  in  controA'ersy  is  in  the 
plaintiffs,  and  if  j'ou  further  find  that  the 
defendant,  in  the  purchase  of  said  proi)erty, 
was  in  no  fault,  then  you  should  lind  the 
value  of  said  property  at  what  you  believe 
was  its  fair  market  value  in  the  condition 
and  place  it  was  situated  when  the  plain- 
tiffs demanded  the  same  of  the  defendant, 
if  such  demand  were  made,  exclusive  of  any 
expenses  or  labor  the  defendant  may  have 
invested  in  manufacturing  the  same  into 
lumber  up  to  the  time  said  demand  was 
made.  But  if  the  evidence  shows  defendant 
knew  or  ought  to  have  known  that  Milliard 
was  not  the  real  owner,  then  you  should  not 
take  into  consideration  any  expense  or  labor 
the  defendant  put  upon  said  logs  and  lum- 
ber, but  give  the  plaintiffs  a  verdict  for  the 
full  value  at  the  time  and  place  it  was  de- 
manded, and  in  its  condition  then."  To  the 
giving  of  this  instruction  the  appellant  ex- 
cepted. 

The  court  had  previously  instructed  the 
jiu-y,  substantially,  that  if  Milliard  had  rep- 
resented himself  to  the  appellees  as  the 
agent  of  the  appellant,  and  they,  relying  on 
such  representation,  sold  him  the  prt)perty 
in  controversy  as  such  agent,  without  any 
intention  of  vesting  the  title  in  him,  but  in- 
tending to  vest  it  in  the  appellant,  when  he 
was  in  fact  not  the  agent  of  the  appellant, 
such  sale  was  void  and  vested  no  title  in 
Milliard,  and  he  could  not  by  a  subsequent 
sale  vest  title  to  the  property  in  the  appel- 
lant. 

This  case  comes  clearly  within  the  law  as 
enunciated  in  the  case  of  Alexander  v. 
Swackhamer,  105  Ind.  81,  4  N.  B.  433,  and 
5  N.  E.  908.  It  is  there  distinctly  decided 
that  in  a  case  like  this  no  title  passes  to 
the  fraudulent  purchaser,  and  that  such  pur- 
chaser cannot  by  any  subsequent  sale  trans- 
fer title  to  another,  for  the  reason  that  he 
has  none  to  transfer.  It  must  be  true,  then, 
that  at  the  time  the  appellees  demanded  pos- 
session of  the  property  of  the  appellant,  at 
Fort  Wayne,  the  title  was  in  them,  as  well 
as  the  right  to  the  possession.  It  was  the 
duty  of  the  appellant  to  surrender  to  them 
such  possession,  and  upon  its  failure  or  re- 
fusal to  do  so,  what  were  they  entitled  to 


212 


AVOIDANCE  OP  CONTRACT. 


recover?  It  is  oarneslly  eouteiided  by  the 
learned  counsel  for  the  appellant  that,  as  the 
freight  from  Sidney  to  Fort  Wayne  was  paid 
by  the  appellant,  the  measure  of  the  appel- 
lees' damages  was  the  value  of  the  property 
at  Sidney.  But  it  must  be  remembered  that 
the  appellant  did  not  purchase  the  property 
at  Sidney.  It  was  purchased  at  Fort  Wayne; 
and  the  appellant  must  be  presumed  to  have 
taken  into  consideration  the  amount  he 
would  be  compelled  to  pay  to  obtain  pos- 
session of  the  property,  in  fixing  its  value  at 
the  time  of  the  purchase.  It  certainly  will 
not  be  contended  that  the  appellant  could 
refuse  to  deliver  the  possession,  upon  de- 
maud,  because  it  had  paid  the  freight.  Nor 
can  it  be  successfully  claimed  that  Milliard, 
the  fraudulent  purchaser,  could  claim  to 
have  tlie  freight  refunded  to  him  if  he  had 
l)een  caught  at  Fort  Wayne,  before  he  had 
disposed  of  the  property.  Section  572,  Rev. 
St.  ISSl.  provides  that  in  a<-tions  to  recover 
the  possession  of  personal  property  judg- 
ment for  the  plaintiff  may  be  for  the  deliv- 
ery of  the  property,  or  the  value  thereof  in 
case  a  delivery  cannot  be  had,  and  for  dam- 
ages for  the  detention  thereof.  It  is  not 
denied  that  at  the  time  of  the  demand  the 
appellant  had  the  property  in  controversy, 
and  that  it  could  have  delivered  it  to  the  ap- 
pellees. By  refusing  to  do  so,  we  think  it 
became  liable  to  the  appellees  for  the  value 
of  such  property  at  the  time  and  place  of 
such  demand  and  refusal,  less  any  addition- 
al value  it  may  have  had  by  reason  of  labor 
bestowed  upon  it,  in  good  faith,  before  such 
demand  was  made.  Mitchell  v.  Burch,  3G 
Ind.  529;  Wells,  Repl.  §§  549,  5(33;  Cushing 
V.  Longfellow,  26  Me.  306.  It  is  claimed 
that  in  actions  for  trover  the  rule  is  dif- 
ferent, but,  as  this  is  an  action  of  replevin, 
we  need  not,  and  in  fact  do  not,  decide  that 
question. 

It  is  earnestly  insisted  by  the  learned  coun- 
sel for  the  appellant  that  as  the  appellees 
permitted  Milliard  to  take  bills  of  lading  in 
his  name,  and  thus  enabled  him  to  sell  the 


property  to  an  innocent  purchaser  for  full 
value,  they  ai-e  now  estopped  from  claiming 
the  property  in  controversy  in  the  hands  of 
the  appellant.  Instructions  were  given  by 
the  court,  and  others  asked  by  the  appellant, 
and  refused,  which  fairly  raise  this  ques- 
tion. 

The  court  instructed  the  jury  that  if  Mil- 
liard had  the  bills  of  lading  made  out  in  his 
own  name  as  the  consignor,  to  enable  him  to 
fraudulently  sell  the  same  to  the  defendant, 
and  the  plaintiffs  knew  that  the  property 
was  so  shipped,  and  that  Milliard's  purpose 
in  so  shipping  said  property  was  that  he 
might  fraudulently  sell  the  same  to  the  de- 
fendant, then  their  verdict  should  be  for  the 
defendant.  In  the  case  of  Alexander  v. 
Swackhamer,  supra,  this  court,  by  Mitchell, 
J.,  says:  "The  appellee  was  not  estopped 
on  the  ground  of  negligence  in  delivering 
the  cattle  under  the  circumstances  disclosed. 
To  constitute  an  estoppel  the  party  sought 
to  be  estopped  must  have  designedly  done 
.some  act  or  made  some  admission  inconsist- 
ent with  the  claim  or  defense  whicli  he  pro- 
poses to  set  up.  and  another  must  have  acted 
on  such  admission  with  his  knowledge  and 
consent."  If  the  appellees  acted  under  the 
belief  that  ^lilliard  was  the  agent  of  the 
appellant,  and  that  they  were  selling  the 
property  to  the  appellant,  basing  such  belief 
on  the  representations  made  to  them  by  Mil- 
liard, we  do  not  think  that  they  would  be 
estopped  from  claiming  their  property  by 
reason  of  permitting  the  bills  of  lading  to 
be  made  out  in  the  name  of  the  supposed 
agent.  The  instructions  asked  by  the  appel- 
lant ignore  this  phase  of  the  case,  and  we 
tliinlv  the  court  properly  refused  to  give 
them.  We  are  of  the  opinion  that  the  in- 
struction given  by  the  court  properly  stated 
the  law  applicable  to  the  case  as  made  by 
the  evidence. 

We  find  no  error  in  the  record  for  wJiicIi 
the  judgment  should  be  reversed.  Judgment 
aflii'med. 

Petition  for  rehearing  overruled. 


AVOIDANCE  OF  CONTRACT. 


243 


BYRNES  V.  VOLZ  pt  al. 

(54  N   W.  042.  r>:i  Minn.  110.) 

Supreme  Court  of  Minnosota.      April  27.  1893. 

Appeal  from  distnct  court,  Kice  county; 
Bnckham,  Judge. 

Action  by  (Jeorge  W.  Byrnes,  as  receiver 
of  the  estate  of  Adolpli  F.  Schacht,  against 
John  Yolz  and  otliers  and  Charles  Thonet, 
to  declare  fraudident  a  transfer  of  a  note  to 
'xnonet  by  Schacht  pending  divorce  proceed- 
ings against  the  latter  by  his  wife,  and  apply 
the  proceeds  of  the  note  in  payment  of  the 
wife's  judgment  for  divorce  and  alimony. 
There  was  judgment  in  favor  of  plaintiff, 
and  defendant  Thonet  appeals.    Affirmed. 

Thos.  H.  Quiim.  for  appellant.  H.  S.  Gip- 
son,  for  respondent. 


DICKINSON,  J.  This  appeal  from  a  judg- 
ment of  the  district  court  brings  in  question 
the  correctness  of  the  legal  conclusions  of 
that  court  from  the  facts  found  by  it.  The 
facts  as  found  by  the  court  may  be  thus 
stated:  During  the  pendency  of  an  action 
for  divorce,  prosecuted  by  a  Mrs.  Schacht 
against  her  husband.  Adolph  F.  Schacht,  one 
of  the  defendants  in  this  action,  the  said 
Schacht  indorsed  and  transferred  to  this 
defendant.  Thonet,  a  promissory  note  for  the 
.sum  of  $500,  the  same  being  the  property  of 
Schacht.  In  consideration  thereof  Thonet 
agreed  to  pay  certain  debts  of  Schacht,  and 
to  board  the  latter  for  one  year,  the  value  of 
which  board  was  fixed  at  .$200.  Schacht  was 
also  indebted  to  Thonet  in  the  sum  of  $45, 
which  indebtedness  was  agreed  to  be  dis- 
charged by  this  transfer.  Thonet  knew  of 
the  pendency  of  the  divorce  smt,  and  this 
note  was  transferred  by  Schacht.  and  was 
received  by  Thonet,  for  the  purpose  and  with 
the  intent  of  hindering,  delaying,  and  de- 
frauding the  wife  as  to  any  alimony  which 
might  be  awarded  to  her,  and  to  render  in- 
effectual any  money  judgment  which  she 
might  recover  in  such  pending  action.  Sub- 
sequent to  the  rendition  of  judgment  in  favor 
of  the  wife,  awarding  a  divorce  with  alimonj', 
and  after  the  return  unsatisfied  of  an  ex- 
ecution against  Schacht.  and  the  institution 
of  proceedings  supplementary  to  execution, 
in  which  Thonet  had  been  required  to  appear 
and  testify  as  to  property  of  the  judgment 
debtor  in  his  hands.  Thonet  received  payment 
of  the  amoimt  then  due  on  the  note,  $425. 
Thereafter  he  paid  out  for  the  defendant 
Schacht,  for  debts  of  the  latter  justly  due, 
the  sum  of  $209.50,  aside  from  his  own  debt 
of  $45.  Schacht  is  insolvent,  and  has  no 
property  subject  to  execution.  This  plaintiff 
was  appointed  receiver  of  his  property 
in  proceedings  supplementary  to  execution. 
The  conclusion  of  the  court  was  that  the 
transfer  of  the  note  to  Thonet  was  fraud- 
ideut  as  to  the  wife  of  Schacht,  and  that  the 
proceeds  of  it  in  his  hands  were  held  by  him 
subject  to  her  right  to  enforce  payment  of 


her  iudgmont  therefrom,  and  that  the  plain- 
tiff was  entitled  to  recover  from  him  (Thonet) 
the  amount  of  her  judgment,  not  exceeding 
the  amount  received  by  him.  Judgment  was 
entered  to  this  effect,  and  Thonet  app(»als. 

For  the  purposes  of  this  decision  we  may 
assume  that  such  a  transfer  of  the  note 
would  not  be  covered  by  any  statute  having 
the  effect  to  avoid  the  same.  unles.s  it  be 
chapter  41,  §  18.  Gen.  St.  1878.  which  de- 
clares void  transfers  of  real  property  made, 
as  well  as  bonds  or  other  evidences  of  debt 
given,  with  intent  to  hinder,  delay,  or  di-fraud 
"creditors  or  other  persons  of  their  lawful 
actions,  damages,  forfeitures,  debts,  or 
demands."  It  is  said  that  the  wife  of  the 
defendant  in  the  pending  divorce  suit,  in 
whose  behalf  this  action  is  prosecuted,  was 
not  a  "creditor;"  that  she  is  not  within  the 
protection  of  the  statute;  and  that  as  to  her 
the  tran-fer  was  not  voidable.  This  statute 
is  founded  upon  that  of  13  Ehz.  c.  5,  which 
included  in  terms  "goods  and  chattels"  with 
other  property,  transfers  of  which,  with  the 
specified  fraudulent  intent,  were  declared 
void.  That  statute  has  been  held  merely 
declaratory  of  a  rule  of  the  common  law, 
and,  notwithstand'ng  the  omission  of  the 
words  "goods  and  chattels"  in  our  enact- 
ment, the  common-law  rule,  partially  ex- 
pressed therein,  remains  in  force.  The 
transfer  of  such  property  with  the  fraiidulent 
intent  specified  in  the  statute  is  voidable. 
Piper  V.  Johnston.  12  Minn.  GO,  GG,  (Gil.  27;) 
Blackman  v.  Wheaton.  13  Minn.  320.  (Gil. 
299;)  Hicks  v.  Stone.  13  M'nn.  434,  440,  (Gil. 
398;)  Benton  v.  Snyder,  22  Minn.  247;  Fox 
V.  Hills,  1  Conn.  294.  The  right  to  call  in 
question  the  validity  of  such  transfers  on  the 
ground  of  fraud  extends  to  others  than 
"creditors,"  in  the  strict  sense  of  that  term. 
Among  the  classes  of  "other  persons"  at 
whose  instance  such  transfers  may  be  avoid- 
ed, because  of  the  intent  to  defraud  them  in 
re.siiect  to  their  "lawful  actions,  damages, 
forfeitures,  debts,  or  demands."  is  that  of  the 
wife  prosecuting,  or  about  to  prosecute,  a 
suit  for  divorce  and  alimony,  when  the 
husband,  with  intent  to  render  ineffectual 
any  recovery  by  her,  transfers  his  property 
to  another  not  a  purchaser  in  good  faiih. 
Twyne's  Case,  3  Coke.  80,  82a;  Livermore  v. 
Boutelle,  11  Gray.  217;  Morrison  v.  Morrison, 
49  N.  H.  GO;  Bailey  v.  Bailey,  Gl  Me.  .".r.l; 
Feigley  v.  Feigley,  7  Md.  537;  Bouslough  v. 
Bouslough.  08  Pa.  St.  495;  Draper  v.  Draper. 
08  111.  17;  Tyler  v.  Tyler.  12G  111.  525.  21  N.  E. 
Rep.  010;  Boog  v.  Boog.  78  Iowa.  524.  4;> 
N.  W.  Rep.  515.  But.  irrespective  of  the  fact 
that  the  statute  applies  to  "other  persons" 
besides  "creditors,"  the  wife,  upon  the  rendi- 
tion of  the  judgment  in  the  pending  suit,  be- 
came an  actual  creditor;  and  even  in  this 
view  of  the  case  she  might  avoid  the  transfer 
made  with  intent  to  defraud  her,  for  a 
transfer  made  with  intent  to  defraud  even 
subseciuent  creditors  is  voidable.  Livermore 
V.  Bjutelle,  supra;    Plvmkett  v.  Plunkett,  114: 


244 


AVOIDANCE  OF  CONTRACT. 


iud.  4S-1,  IG  N.  E.  Hop.  012,  and  17  N.  E.  Rep. 
5G2. 

The  appellant  avus  an  active  party  with  tlie 
husl):uicl  in  the  accomplishment  of  the  fraud- 
ulent purpose.  The  agreement  to  board 
Schacht  for  a  j-ear,  made  with  the  intent  to 
defeat  or  render  ineffectual  the  claim  of  the 
wife  in  the  pending  action,  was  a  fraud  upon 
her.  condemned  alike  by  the  common  law  and 
by  the  statute,  and,  being  a  substantial  part  of 
the  consideration  for  the  transfer  of  the  note, 
that  alone  rendered  the  transfer  voidable, 
notwithstanding  the  further  consideration 
that  j^honet  should  pay  certain  debts  of 
Schacht,  much  less  in  amount,  as  it  seems, 
thari  the  value  of  the  property  transferred. 
Albee  v.  Webster,  16  N.  H.  302;  Morrison 
..    Morrison,   supra;    Sidensparker  v.    Sidou- 


sparker,  52  Me.  481,  490;  Twyne's  Case,  supra. 
Thonet,  having  actively  participated  in  the 
fraud,  is  not  entitled  to  protection  even  as 
to  the  amounts  paid  by  him  out  of  the  pro- 
ceeds of  the  note  which  he  collected.  The 
transfer  to  him  is  to  be  treated  as  void  in  its 
entirety,  and  he  is  answerable  for  the  pro- 
ceeds of  the  note,  without  deduction  even  on 
account  of  his  own  debt.  Thompson  v.  Bick- 
ford,  19  Minn.  17,  (Gil.  1.)  The  case  Avill  be 
seen  to  be  distinguishable  from  one  where 
the  property  of  the  debtor  is  appropriated 
wholly  in  payment  of  the  debts  of  preferred 
creditors,  there  being  reserved  no  benelit  io 
himself  from  the  transfer. 
Judgment  affirmed. 

VANDERBURGH,  J.,  took  no  part. 


AVOIDANCE  OF  CONTItACT. 


245 


RIXDSKOPF  T.  MYEHS. 

(57  N.  W.  t»(i7,  87  Wis.  80.) 

Siii)r(Mno   Court  of  Wisconsin.      Jan.   AO.   1894. 

Appeal  from  circuit  court.  Wood  (^lunty; 
Cliarles  "\'.  Banlepu.  Jurlcrp. 

Action  by  Elia.s  Rindslcopf  against  Henry 
Mj-ers.  Tiun-e  was  ju{l;.;uient  for  defendant, 
and  plaintiff  appeals.    Affirmed. 

The  other  facts  fully  appear  in  the  fol- 
lowing statement  by  PINNEY,  J.: 

This  action  was  brought  by  the  plaintiff  to 
recover  the  value  of  the  greater  portion  of  a 
stock  of  goods  sold  and  delivered  by  Hyman 
Nathan  to  the  plaintiff,  and  seized  a  few 
days  thereafter  under  writs  of  attachment 
in  the  hands  of  the  defendant,  as  sheriff  of 
Clark  cotmty,  in  favor  of  Henry  Benedict,  a 
creditor  of  Hyman  Nathan,  on  the  gi'ound 
that  the  sale  to  the  plaintiff  by  Hyman  Na- 
than was  fratidulent  and  void  as  again.st  his 
creditors.  The  record  presents  only  certain 
alleged  errors  in  the  instructions  of  the 
court  to  the  .jiu-y,  and  its  refusal  to  give  cer- 
tain others,  it  being  conceded  that  the  evi- 
dence in  the  case  to  support  a  verdict  for  the 
defendant  is  sufficient.  Facts  and  circum- 
stances were  given  in  evidence,  some  of 
which  amounted  to  badges  or  indicia  r" 
fraud,  properly  calling  for  instnictions  on  all 
the  points  hereinafter  stated.  The  court  in- 
structed the  jury,  among  other  things,  that 
"(1)  a  sale  or  assignment  of  all  a  man's  prop- 
erty, when  he  is  largely  in  debt,  natm-ally  ex- 
cites suspicion  of  fraud,  and  is  therefore  evi- 
dence of  fraud,"  and  in  this  immediate  con- 
nection added:  "Or  if  made  in  miusual  haste, 
and  not  in  the  manner  in  which  men  of  ordi- 
nary care  and  prudence  usually  transact 
their  business,  or  if  made  at  greatly  inade- 
quate price,  these  and  similar  acts  are  badges 
of  fraud.  They  are  not  fraud,  but  may  be 
considered,  when  they  are  proven  to  exist, 
by  the  jury,  as  facts  and  circumstances  tend- 
ing to  show  fi-aud.  (2)  When  a  sale  is  made 
with  intent  to  hinder,  delay,  or  defraud  cred- 
itors, it  is  void,  if  the  pai'ty  receiving  or  pur- 
chasing the  property  so  sold  had  knowledge 
of  such  intent;  but  this  knowledge  need  not 
be  actual,  positive  information  or  notice,  but 
may  be  inferred  from  the  knowledge  by  the 
purchaser  of  facts  and  circumstances  suffi- 
cient to  raise  such  suspicions  as  should  put 
him  upon  inquiry  as  to  the  real  situation, 
and  which,  if  pursued,  would  lead  him  to 
the  truth."  That,  if  the  sale  was  with  fraud- 
ulent intent  on  the  part  of  X;ithan,  the  jury 
should  inquire  if  the  plaintiff  knew  of  such 
intent,  "or  had  knowledge  or  notice  of  such 
facts  and  circumstances  as  to  put  him,  as  a 
reasonably  prudent  man,  upon  inqiiiry  in  re- 
lation thereto,  and  would  have  led  to  his  as- 
certaining the  truth."  That  if  Nathan  in- 
tendea  to  defraud  his  creditors,  and  if  "the 
circumstances,  .situation,  and  surroundings 
were  such  as  to  put  an  ordinarily  prudent 
man    on    his    guard,    and    the    plaintiff    had 


knowledge  thereof,  and  purpasely  or  negli- 
gently onntted  to  make  such  in(]uiries  as  an 
ordinarily  prudent  and  cautious  man  would 
h:ive  made  in  liis  situation,  v.iiich  inquiries, 
if  pursued,  would  have  led  to  his  ascertain- 
ing the  truth  as  to  Nathan's  intent,  then  the 
plaintiff  cannot  recover."  The  court  refused. 
lO  instruct  the  jury,  at  plaintiff's  recpiest,  (1) 
that  if  the  plaintiff  "had  no  knowledge  of  the 
intent  on  Nathan's  part,  and  did  not  partici- 
pate with  him  in  such  intent,  then  the  jury 
should  find  for  the  plaintiff;  (2)  to"  avoid 
the  .sale  the  fraudulent  intent  must  be  known 
to,  and  entertained  by,  both  biiyer  and  seller, 
and  both  must  be  connected  with  the  fraudii- 
lent  design;  (3)  the  payment  by  a  purchaser 
of  a  fair  consideration  upon  a  sale  of  prop- 
ert.v,  although  not  conclusive,  is  strong  evi- 
dence of  the  good  faith  of  the  ti-ansaction, 
and  requires  clear  evidence  of  fraudident 
intent  to  overcome  it."  On  the  cross-exam- 
ination of  Louis  Rindskopf,  a  witness  for  the 
plaintiff",  his  brother,  the  court  allowed  de- 
fendant's counsel,  against  plaintiff's  objec- 
tions, to  show  that  he  (Louis)  did  not  ask 
Nathan  any  questions  as  to  whether  he  owed 
for  his  stock  of  goods,  or  was  pressed  by 
creditors;  that  he  asked  him  no  questions 
at  all. — made  no  inquiries  as  to  his  financial 
condition.  On  the  cross-examination  of  the 
plaintiff',  it  appeared  that  he  had  a  bank 
book,  and  that  it  was  in  Milwaukee.  On 
re-examination  his  counsel  asked  him  to  state 
the  reason  he  had,  if  any.  for  not  bringing 
the  book.  The  court  nded  that  the  reason 
why  he  did  not  bring  it  was  immaterial,  un- 
less requested  to  bring  it.  and  even  then  it 
might  be  immaterial.  It  appeared  that  nO' 
such  request  was  made,  and  the  coiu't  ex- 
cluded the  inqiiu-y.  The  jury  found  for  the- 
defendant,  and  the  defendant  had  judgment, 
from  which  the  plaintiff  appealed. 

R.  J.  MacBride.  for  appellant.  James 
O'Neill,  for  respondent. 

PINNEY,  J.,  (after  stating  the  facts.)  1. 
The  instruction,  in  substance,  that  the  sale 
or  assignment  of  all  a  man's  property,  when 
he  is  largely  in  debt,  naturally  excites  sus- 
picion of  fraud,  and  is  therefore  evidence  of 
fraud,  must  be  considered  with  the  contexts 
The  com*t  had  instanced  this  with  some  other 
like  facts,  saying:  "This  and  similar  acts 
are  badges  of  fraud.  They  are  not  fraud, 
but  may  be  considered,  when  they  are 
proven  to  exist,  by  the  jury,  as  facts  and  cir- 
cumstances tending  to  show  fraud."  The 
jm-y  were  told  that  in  this  sense  the  particu- 
lar fact  or  badge  of  fraud  referretl  to  was 
evidence  to  show  fraud,  but  not  that  it  was 
sufficient  to  prove  it.  We  think  the  jury 
could  not  have  misunderstood  the  purport 
and  meaning  of  the  charge,  and  that,  as  ex- 
plained, it  was  correct,  and  is  in  accordance 
with  what  was  held  in  Bigelow  v.  Doolittle, 
3(j  Wis.  119.  and  Pilling  v.  Otis.  13  Wis.  553. 
The  charge,  in  this  and  other  respects,  ren- 


246 


AVOIDANCE  OF  CONTRACT. 


ck'i-c-d  it  unuocessary  to  instruct  the  jury  that 
they  were  not  to  infer  an  intent  to  defraud 
from  the  mere  fact  that  Nathan  sold  his  en- 
tire stock  to  the  plaintiff.  The  court  had 
said,  in  substance,  that  a  sale  of  the  entire 
stock  of  one,  when  largely  in  debt,  would  be 
evidence  or  a  bad^e  of  fraud,  and  that  a  per- 
son in  failing  circumstances  misht  notwith- 
standinj;  sell  and  convey  a  good  title  to  his 
property.  This  was  sutticiently  clear  and 
favorable  to  the  plaintiff. 

2.  The  instruction  asked  by  the  plaintiff 
that  payment  by  the  purchaser  of  a  fair  con- 
sid(-ratiou  was  strong  evidence  of  good  faith, 
and  required  clear  evidence  of  fraudulent  in- 
tent to  overcome  it,  if  given,  would  have  been 
a  clear  invasion  of  the  province  of  the  jury, 
and  was  therefore  properly  refused.  The  ef- 
fect of  evidence  of  payment  of  such  consider- 
ation, as  well  as  what  evidence  would  or 
would  not  suftice  to  overcome  it,  were  ques- 
tions depending  upon  all  the  facts  and  cir- 
cumstances in  evidence  bear  n  ;■  upon  h  >  bona 
fides  of  the  sale,  and  were  to  be  decided  by 
the  jury,  and  not  by  the  court.  Bigelow  v. 
Doolittle,  supra;  Lampe  v.  Kennedy,  GO  Wis. 
110,  18  N.  ^Y.  730. 

3.  All  other  instructions  excepted  to,  and 
the  refusal  to  give  those  relevant  to  the  case 
and  not  fairly  embraced  in  the  general 
charge,  present,  in  substance,  the  single  ques- 
tion, in  somewhat  varied  phraseology,  wheth- 
er knowledge  on  the  part  of  the  piu-chaser 
of  his  vendor's  intent,  in  making  the  sale,  to 
hinder,  delay,  or  defraud  his  creditors,  must 
be  actual,  positive  information  or  notice,  or 
belief  of  that  fact,  or  whether,  as  the  court 
instructed,  that  knowledge  or  notice  of  such 
intent  might  be  inferred  from  knowledge  on 
the  part  of  the  purchaser  of  facts  and  cir- 
cumstances sufficient  to  raise  such  suspicions 
as  to  put  him,  as  a  reasonably  prudent  man, 
upon  inquiry  in  relation  thereto,  and  would 
have  led  to  his  ascertaining  the  truth;  that  if 
the  circumstances,  situation,  and  surround- 
ings Avere  such  as  to  put  an  ordinarily  pru- 
dent man  on  his  guard,  and  he  purposely  or 
negligently  omitted  to  make  such  inquiries 
as  an  ordinarily  prudent  and  cautious  man 
would  have  made  in  his  situation,  and  which, 
if  pursued,  would  have  led  to  his  ascertain- 
ing the  truth  as  to  his  vendor's  intent,  in 
cither  case,  in  an  action  such  as  this,  it  would 
prevent  a  recovery  by  the  purchaser.  The 
rulings  of  the  court  in  the  instructions  given, 
and  in  refusing  those  asked,  are  certainly  in 
accordance  with  the  law  as  settled  in  this 
state  nearly  a  quarter  of  a  century  ago,  and 
since  then  frequently  reiterated  in  clear  and 
unmistakable  terms,  although  a  different  view 
of  the  law  has  been  and  still  is  maintained  in 
some  of  the  states,  in  cases  cited  by  the  ap 
l)ellant's  counsel.  This  conflict  of  decided 
cases   is   considered   somewhat   at   length   in 

Wait  on  Fraudulent  Conveyances,  (sections 
374^370.)  and  in  Bump  on  the  same  subject, 
(page  2CX).)  where  the  cases  on  both  sides  are 
collected,   and   the   rule  applied   by    the   cir- 


cuit  court,    and   hitherto   maintained   in   this 
state,  is  approved.     In   Avery  v.   .Johan,   27 
Wis.  24G,   247,  it  was   held  that  knowledge 
of  such  facts  and  circumstances  as  raised  a 
suspicion  in  the  mind  of  the  purchaser,  and 
did  or  ought  to  have  put  him  upon  inquiry, 
was    sufficient,    so    that    he    purchased    and 
paid  at  his  peril;    and  the  rule  in  Atwood  v. 
Impson,  20  N.  J.  E(i.  150,  in  accordance  with 
the   charge   in    this   case,   is    cited    with   ap- 
proval.    The  rule  was  laid  down  with  added 
vigor  and  clearness  in  Hopkins  v.  I.angton, 
30    Wis.    379,    381.     To    the    same    effect    is 
David   V.   Birchard,   53  Wis.   405,  400,   10   N. 
W.  557.     In  Brinkman  v.  Jones,  44  Wis.  498, 
and  Helms  v.  Chadbourne,  45  Wis.  61.  in  rela- 
tion to  sales  of  real  estate,  the  court  said: 
"We  think  the  true  rule  is  that  notice  must 
be  held    to   be  actual  when  the   subsequent 
purchaser  has  actual  knowledge  of  such  facts 
as   would   put  a  prudent   man  upon   inquiry, 
which,  if  prosecuted  with  ordinary  diligence, 
would  lead  to  actual  notice  of  the  right  or 
title  in  conflict  with  that  which  he  is  about 
to  purchase."     And  the  conflict  in  the  cases 
is  noticed  and  considered  by  Mr.  Justice  Tay- 
lor in  his  opinion  in  the  former  case.     The 
rule  thus  maintained  was  expressly  approved 
in  the  circuit  court  of  the  United  States  for 
this  circuit  by  Harlan  and  Bunn.  JJ.,  in  Bar- 
ties  V.  Gibson,  17  Fed.  293.  and  in  the  Case 
of  HoUaday,  27  Fed.  849.     The  question  was 
subse(iuently  before  this  court  in  Hooser  v. 
Hunt,  G5  Wis.  72,  20  N.  W.  442,  wlien  many 
of  the  eases  relied  on  by  the  appellant  here 
were  cited,   but  the  court  refused  to  recon- 
sider the  rule  thus  established  in  this  state, 
and  to  which  we  adhere.     We  think  the  rule 
was  fairly  expressed  in  the  general  charge, 
and  that  it  justified  the  refusal  to  give  the 
instructions  requested,  already  noticed.     It  is 
a  rule  applicable  alike  to  legal  and  equitable 
actions,  whether  the  subject  of  the  action  is 
personal  or  real  estate.     One  about  to  pur- 
chase   under    the    circumstances    stated     is 
bound  to  stay  his  hand,  and  if  he  will  not 
the   fault   is   wholly  his   own.     The  question 
of  fraud,  and  of  notice  of  the  intent  to  de- 
fraud, is  still  a  question  for  the  jury,  who, 
when  they  find  the  facts,  are  to  apply  the 
rule  and  declare  the   consequence;    and    we 
fail  to  see  in  it  anything  in  conflict  with  the 
statute  making  fraud,  in  cases  such  as  this, 
a  question  of  fact  for  the  jury. 

4.  There  was  no  evidence  in  the  case  to 
warrant  the  submission  to  the  jury  that  there 
was  any  scheme  or  conspiracy  on  the  part  of 
Stumes.  Hyman  Nathan.  Louis  Rindskopf, 
and  the  plaintiff  to  defraud  the  creditors  of 
Nathan,  or  tending  to  such  a  conclusion,  and 
there  was  no  such  suggestion  in  any  part  of 
the  general  charge,  nor  anything  to  show 
that  any  such  claim  had  been  made;  and 
therefore  the  refusal  to  instruct  the  jury  that 
there  was  no  evidence  to  warrant  such  a 
finding  was  not  prejudicial  to  the  plaintiff, 
and  the  testimony  elicited  from  Louis  Rind- 
skopf,  against   the  plaintiff's  objection,   had 


AVOIDANCE  OF  CONTRACT. 


247 


no  tendency  to  establish  any  such  conspiracy. 
We  do  not  see  any  reason  for  saying  that  the 
plaintiff  could  have  been  injuriously  affected 
by  it. 

5.  As  the  plaintiff  had  not  been  requested 
by  the  defendant  to  bring  his  bank  book  to 
the   trial,    the   covu't   properly   ruled    that    it 


was  wholly  immaterial  why  he  omitted  to  do 
so.  No  sufficient  reason  appears  for  his  en- 
tering upon  any  explanation  on  the  subject. 
It  follows  from  these  views  that  the  judg- 
ment of  the  circuit  court  is  correct,  and  must 
be  affirmed.  The  judgment  of  the  circuit 
comt  is  aifirmed. 


248 


AVOIDANCE  OF  CONTRACT. 


NICHOLS  V.  BANCROFT  et  al. 

(41  N.  W.  SOI,  74  Mich.  191.) 

Supreme  Court  of  Michigan.     Feb.  15,  1SS9. 

Appeal  from  ciivniit  court,  St.  Clair  county, 
in  cliHUCery;  Canfield,  Judge. 

Atkinnon  &  Vanoe,  for  appellants.  Charles 
K.  Dodge,  {Parker  &  Burton,  of  counsel,) 
for  appellee. 

LONG,  J.  The  bill  is  filed  in  tliis  cause  in 
aid  of  execution.  The  court  below  made  a 
decree,  substantially  as  prayed  in  the  bill, 
from  which  defendants  appeal.  The  follow- 
ing is  a  statement  of  the  facts,  which  we 
take  largely  from  brief  of  the  counsel  for 
complaiuaut:  On  ]\Iarch  6,  1883,  a  judgment 
in  favor  of  the  complainant  was  obtained  in 
tlie  St.  Clair  circuit  court,  against  \Villiam 
L.  Bancroft  and  Edgar  White,  for  the  sum 
of  .$5,141.81,  and  costs  taxed  at  .$20.  Coun- 
sel for  Mr.  Nichols,  after  iuriuiry  and  search, 
found  no  pro])erty  upon  which  to  levy,  be- 
longing L'ither  to  IJancroft  or  White ;  but,  un- 
d  isianding  that  IMr.  J3ancrott  was  to  he 
called  as  a  witness  in  another  ease,  wherein 
he  was  testifying  as  to  liis  solvency,  counsel 
for  Mr.  Nichols  attended  to  find  out  whether 
li^  would  testify  to  the  ownerliip  of  property 
subject  to  levy.  Mr.  Bancroft  in  his  testi- 
mony in  that  case  did  admit  ownership  of 
real  estate,  but  could  not  recollect  the  de- 
scription, and  while  he  was  yet  testifying 
counsel  hurried  out  to  look  up  the  descrip- 
tion, and  get  a  levy  made,  but  before  he 
could  do  so  iMr.  Bancroft  finished  his  testi- 
mony, and  put  a  deed  on  record  at  11:10  a. 
M.,  conveying  the  land  to  his  son,  Carroll  D. 
Bancroft,  for  an  alleged  consideration  of 
$400.  The  levy  was  made  after  the  tleed  was 
filed  for  iec<n\l,  and  this  bill  is  filed  in  aid  of 
the  execution.  The  defendants  claim  that 
the  deed  was  made  in  pursuance  of  an  ar- 
rangement or  bargain  between  them  in  the 
winter  of  1882  and  188">  to  repay  money  bor- 
rowed by  Mr.  Bancroft  from  his  son,  Carroll. 
It  appears  that  another  judgment  had  been 
obtained  on  notes  against  Stevvart,  Goiilden, 
and  Wiiham  L.  Bancroft  and  others,  some 
time  previous.  Stewart  was  tiie  only  respon- 
sible defendant  in  that  judgment,  and  had 
paid  it  in  full.  He  tlien  began  a  suit  in  eq- 
uity to  compel  Goulden  to  [)ay  a  moiety  of 
the  judgment.  Stewart  deceased  before  the 
hearing.  It  was  in  this  case  that  William 
L.  Bancroft  was  called  as  a  witness  to  show 
his  solvency  or  insolvency.  Counsel  for  com- 
plainant claims  that,  if  he  had  been  solvent 
at  the  time  the  suit  in  equity  was  begun  by 
Stewart  against  Goulden,  his  testimony  to 
that  effect  would  have  tended  to  defeat  the 
case,  and  that  his  testimony  in  that  case  did 
lend  to  siiow  his  solvency  at  the  time  the 
suit  was  begun,  and  at  the  time  he  was  testi- 
fying. It  was  at  this  time  that  counsel  for 
Mr.  Nichols  attended  to  find  out  whether,  in 
his  testimony,  Bancroft  would  admit  of  pres- 
ent ownership  of  property  subject  to  levy. 
Mr.  Bancroft  was  called  to  testify  in  the  case 


of  Stewart  v.  Goulden,  about  10  o'clock  a, 
M.,  March  13,  1883.  He  testified  to  present 
ownership  of  12|  acres  of  land  on  section 
1  of  the  township  of  Wales,  St.  Clair  county, 
but  could  not  recollect  tiie  description.  He 
said  he  owned  it,  and  that  the  title  was  iu 
him.  Counsel  for  Mr.  Nichols,  who  heard 
the  testimony,  immediately  left  tlie  court  to- 
get  a  levy  upon  the  laml  in  the  case  of  Nich- 
ols V.  Bancroft  and  White.  Mr.  Dodge, 
counsel  for  Mr.  Nichols,  went  some  30  rods^ 
or  a  little  more,  to  the  abstract  olHce,  to  look 
up  the  description,  and  returned  to  the  court- 
house, when  he  found  that  Mr.  Bancroft  had 
finished  his  testimony,  and  put  the  deed  on 
record  to  his  son.  Mr.  Bancroft  says  that 
this  deed  was  not  executed  until  after  he 
gave  his  testimony  in  the  Stewart  Case ;  that, 
after  giving  his  testimony,  he  went  to  his- 
office,  executed  the  deed,  and  his  son,  Car- 
loll,  took  it  to  the  register's  office,  and  put 
it  on  record.  The  testimony  shows  that  the 
distance  from  the  court-house  to  his  oifice 
and  return  was  about  one-half  a  mile.  The 
deed  was  in  iMr.  i5anjrofL's  handwriting, 
and  was  acknowledged  on  that  day.  It  is- 
admitted  that  Mr.  Bancroft  and  his  son,  Car-^ 
roll,  were  in  Port  Huron  several  days  before 
this  deeil  was  given,  and  before  Mr.  Bancroft 
gave  liis  testimony  in  the  Stewart  Case,  and 
remained  there  several  days  after  that.  Mr. 
Bancroft,  in  his  testimony  in  the  present 
case,  says  tliat  he  had  bargained  this  land 
away  to  his  son,  Carroll,  some  tiiree  months 
before  he  gave  his  testimony  in  the  Stewart 
Case,  and  for  the  consideration  of  .$400,  then 
agreed  upon,  but  that  the  deed  was  not  then 
made  out,  because  he  did  not  then  have  the 
description;  that  tliis  deed  was  to  be  made  in 
consideration  of  the  .$400,  which  he  had  be- 
fore that  time  borrowed  of  his  son,  Carroll. 
Counsel  for  complainant  now  contends  that 
the  fori'going  facts  show  beyond  question  tiiat 
the  story  of  William  L.  Bancroft  and  his  son 
about  borrowing  money,  and  an  agreement 
to  deed  the  land  in  question  in  payment 
thereof,  was  purely  an  after-thought, — a 
story  made  up  to  suit  the  circumstances  of 
the  case  as  well  as  might  be;  that  there  was 
a  concerted  action  between  the  two  defend- 
ants to  defeat  the  plaintiff's  claim,  by  con- 
veying the  property  in  such  a  way  that  it 
could  not  be  levied  upon;  and  that  this  was 
done  for  the  express  purpose  of  defrauding 
the  creditors  of  the  defendant.  There  is  nO' 
contention  but  what  the  deed  in  question 
was  placed  upon  record  before  the  levy  was 
made.  The  foregoing  circumstances,  in  sub- 
stance, are  about  all  the  claims  set  forth  by 
the  pleadings,  and  in  the  proofs  upon  which 
complainant  relies  to  set  aside  this  deed,  ex- 
cept that  William  L.  Bancroft,  as  is  shown^ 
had  an  order  on  the  bank  at  Port  Huron, 
dated  in  February  or  March,  18S3.  signed  by 
Carroll,  by  which  he  was  authorized  to  draw 
any  money  fi'om  the  bank  standing  in  Car- 
roll's name  on  a  certain  book  numbered  1,G87, 
and  that  the  testimony  of  the  defendants  is- 
not   to   be   believed.      The   two   defendants- 


AVOIDANCE  OF  CONTRACT. 


249 


were  examined  as  witnesses  on  the  hearing 
of  the  case  in  tlie  court  below. 

'i'iie  testimony  of  the  defendant  Carroll  D. 
Bancroft  was  taken  by  commissioner  at  Hot 
Spriiii^s.  Ark,  He  testilies,  in  answer  to  in- 
terro.'ations  put  to  him,  that  his  father, 
William  L.  Bancrolt,  was  indebted  to  him  in 
the  sum  of  about  8800.  The  sum  of  s600 
was  for  cash  loaned  to  his  father  on  Febru- 
ary 11,  lbS'2,  and  the  balance  for  cash  sent 
him  from  Florida,  and  that  on  March  13, 
188;J,  he  received  a  deed  from  his  faliier  of  a 
piece  of  land  in  the  town  of  Wales,  St.  Clair 
county,  known  as  the  "Railroad  Sand  Pit." 
Th  it  he  was  present  when  the  deed  was  exe- 
cuted and  acknowledired,  having  himself  re- 
quested Charles  D.  Tliompson,  a  notary  in 
and  for  said  county,  to  take  the  acknowledg- 
ment; and  that  the  deed  \.as  delivered  to 
him  by  William  L.  Bancroft.  That  lie  took 
the  deed  himself  to  the  office  of  tlie  register 
of  deeds  of  St.  Clair  county,  and  had  it  re- 
corded. That  the  consideration  for  the  deed 
was  the  money  had  of  him  by  his  father,  as 
befoie  stated;  and  that  the  deed  was  given  in 
pursuance  of  a  previous  understanding  with 
his  father  at  Hot  Springs,  Ark.,  in  the  win- 
ter of  1882  and  1883.  That  the  first  he  knew 
of  the  judgment  of  Edwin  C.  Nichols  against 
William  L.  Bancrott  and  Edgar  White  was 
when  he  was  called  upon  to  answer  the  com- 
plaint filed  in  this  cause.  On  his  cross-ex- 
am, nation  he  stated  that  on  March  13,  1883, 
at  the  tiuiethe  deed  was  executed,  his  mother 
was  at  Hot  Springs,  Ark.  That  the  money 
loaned  his  father  was  partly  money  he  re- 
ceived from  his  mother,  and  partly  from  his 
own  e.irnings.  That  he  had  money  and  prop- 
erty which,  prior  to  March  13,  1883,  he  had 
earned  paitly  in  Port  Huron  and  partly  in 
Hot  Springs,  as  a  teacher  of  languages,  as  a 
clerk,  and  in  the  {)rofession  of  music.  Wit- 
ness further  says  that  he  received  in  1880  or 
1881  a  quarter  interest  in  the  Arctic  Ice  Com- 
pany of  Jacksonville,  Fia.,  valued  at  81.000, 
as  a  gift  from  his  motlier.  That  the  deed  in 
question  has  been  in  ids  possession  ever  since 
It  was  reconled,  and  was  delivered  to  him  by 
his  father  on  tlie  day  of  its  execution,  some 
time  before  dinner,  and  tliat  he  took  it  at 
once  to  the  olfice  to  have  it  recorded,  and 
gave  it  personally  to  the  register  of  dee  Is. 
In  answer  to  a  cross-interrogatory  put  to 
him,  as  to  the  circumstances  under  wliicli  the 
deed  was  to  be  given,  the  witness  testified 
that  there  was  an  agreement  between  his  fa- 
ther and  himself  in  regard  to  deeding  him 
the  land  in  question.  Tliat  it  was  made  at 
tiieir  house,  in  Hot  Springs,  Ark.,  in  the 
winter  of  1882  and  1883;  and  it  was  that  he 
should  have  the  deed  when  they  went  north 
in  the  sprintr,  an  1  could  get  the  description. 
That  his  father  said  it  was  good  for  a  ballast 
pit,  and  would  soon  be  wortii  something,  as 
tlie  C.  &  G.  T.  liailroad  would  soon  be 
compelled  to  set  up  their  track  again,  and 
lie  thought  it  was  worth  8400.  That  it  was 
a  verbal,  but  distin  t,  agreement  between 
them,  as  to  the  matter,  and  he  believed  it 


was  woith  that  amount.  That  it  was  the 
desire  of  his  father  to  give  him  something 
for  th  '  money  he  hid  from  him,  as  he  had 
not  the  money  to  pay  him,  and  ha  agreed 
to  take  the  luni  at  that  price.  That  his 
mother  did  not  sign  the  deed,  because  she 
wjvs  not  there.  This  testimony  of  Carroll  D. 
Bancroft  is  fully  corroborated  by  the  testi- 
mony of  his  father,  William  L.  Bancroft. 
On  his  cross-examination,  Mr.  William  L. 
Bincroft  was  asked:  "Was  not  the  fact  that 
that  piece  of  property  might  be  levied  upon, 
being  the  only  one  held  in  your  name  in  this 
county,  the  re.ison  of  your  putting  tiiat  deed 
on  record  at  that  particular  timer'  A/iswcr. 
My  recollection  is  that  it  was  not  the  only 
piece  of  property  I  had.  I  think  the  record 
would  show  to-day  that  I  transferred  an  in- 
terest. I  quitclaimed  an  interest  in  a  forty- 
acre  lot  (1  would  not  be  positive  ai)out  the 
date)  since  that  time.  As  to  3'our  question, 
I  will  say,  no;  1  did  not  put  it  on  record. 
Qnestioji.  Was  not  that  the  reason  of  your 
executing  it  at  tiiat  particular  tiiiiey  A.  I 
have  not  th"  slightest  recollection  of  think- 
ing that  there  was  any  trouble  impending  to 
me  in  the  Stewart  Case  at  all,  while  in  regard 
to  the  Nichols  Case  it  had  actually  not  come 
to  my  knowledge  that  a  judgment  had  been 
taken  there.  You  see  I  was  not  here  when 
that  judgment  was  taken."  Mr.  Charles  D. 
Thompson  was  called  as  a  witness  by  defend- 
ants, and  testified  that  he  is  assistant  cash- 
ier of  the  Port  Huron  Savings  Bank,  and  that 
on  Febi  uary  11,  1882,  a  check  was  drawn  in 
favor  of  William  L.  Bancroft  on  their  bank 
for  8600  on  CD.  Bancroft's  savings  account; 
that  Mr.  W.  L.  Bancroft  at  that  time  ha  1  a 
written  order  from  Carroll  to  draw  on  that 
fund;  that  at  the  time  this  check  was  drawn 
the  fund  was  8671.88,  and  on  deposit  since 
that  in  that  fund  was  82,329.64  in  Carroll  Ban- 
croft's na:ne;  that  this  account  commenced 
back  in  1875,  with  a  deposit  of  82;  up  to 
January,  1877,  the  total  amount  of  deposit 
was  8330.96;  from  1879  to  1851  the  total  de- 
posit was  8-300;  up  to  April,  1882,  he  depos- 
ited 83.001.52;  in  April  and  May,  1882.  he 
deposited  about  81,100:  from  that  time  down 
to  October,  1885,  it  figured  up  to  89,500, 
when  the  account  closes;  and  that,  so  far  as 
the  bank  knew,  there  was  no  one  interested 
in  this  account  except  Carroll  D.  Bancroft; 
that  drafts  were  drawn  right  along  from 
time  to  time  on  this  account,  so  that  at  no 
time  was  there  a  very  large  balance;  but 
that,  as  Carroll  grewolder,  the  account  grew 
longer,  till  it  closed. 

This  testimony  stands  upon  this  record 
wholly  uncontradicted,  except  by  the  circum- 
stanct'S  befoie  set  out.  and  these  circum- 
stances counsel  for  complainant  contends 
should  outweigh  the  positive  statements  of 
Carroll,  corroborated  by  his  father  and  Mr. 
diaries  D.  Thompson.  We  find  nothinsj  in 
the  record  to  contradict  the  fact  that  on  Feo- 
ruary  11,  1882,  the  check  was  drawn  for  8600 
against  the  fund  belonging  to  Carroll,  then 
in  the  bank,  and  that  William  L.  B.mcroft  had 


250 


AVOIDANCE  OF  CONTRACT. 


tlie  money.  Mr.  Thompson  testified  to  this. 
The  bank-books  show  the  fact.  Carroll  s  wears 
that  it  was  paid,  and  that  it  was  his  money; 
■and  he  gives  an  exphmation  as  to  how  he  be- 
came possessed  of  it.  Carroll  further  testi- 
iies  tiiat  it  was  in  consideration  of  tiiis  that 
his  father  agreed  to  deed  liim  this  land;  and 
that  on  ^laroli  13,  1883,  in  pursuance  of  such 
agreement,  the  deed  was  so  m  ide  and  deliv- 
ered Lo  him,  and  he  placed  it  on  recorii.  To 
meet  this  testimony  the  complainant  says 
tliat  William  L.  Bancroft,  having  in  tiie  fore- 
noon of  March  13, 1883,  testified  in  the  Stew- 
art Case  tliat  he  was  then  the  owner  of  the 
identical  piece  of  property,  and  having  at 
once,  after  giving  his  testimony,  gone  to  Ills 
oflice,  and  made  and  delivered  tliis  deed  to 
Oirroll,  it  is  evidence  of  an  intent  to  defraud 
the  complainant  and  his  other  creditors.  If 
this  fact  were  conceded,  it  would  not,  stand- 
ing alone,  destroy  the  validity  of  this  deed. 
Something  further  must  be  found.  The  court 
must  not  onlv  be  satisfied  tliat  the  deed  was 


made  with  intent  to  hinder,  delay,  or  to  de- 
fraud creditors,  but  that  the  deed  was  not 
actually  made  to  pay  a  debt  justly  due.  The 
burden  was  upon  the  complainant  to  pi'ove 
tills  fact.  It  not  only  is  not  [iroven,  but  the 
testimony,  we  think,  shows  very  clearly  that 
William  Ij.  Bancroft  was  indebted  to  CarroU 
m  the  amount  claimed.  ^Vilere  property  goes 
to  pay  an  honest  debt,  that  use  oi  it  is  law- 
ful, although  it  may  cut  off  tlie  redress  of  all 
others,  anil  although  intended  to  do  so.  We 
think  the  testimony  upon  the  part  of  the  com- 
plainant falls  far  short  of  making  a  case 
upon  which  a  court  of  equity  would  be  justi- 
fied in  setting  aside  this  deed,  and,  when  we 
take  the  case  made  by  the  defendants' proofs, 
we  are  satisfied  that  Carroll  took  this  deed  in 
payment  of  a  bona  fide  debt  then  due  him 
from  his  fatlier.  Tlie  decree  of  the  court  be- 
low must  l)e  set  aside,  and  decree  entered  in 
this  court  dismissing  complainant's  bill,  with 
costs  of  both  courts.  The  other  justices  con- 
curred. 


AVOIDANCE  OF  COXTIIACT. 


251 


WILSON  V.  SrEAR  et  ux. 

(34  Atl.  429.) 

Supreme   Court  of   Vermont.      Windsor.     Sept. 
20,  1895. 

Appeal  in  ebancery,  Windsor  county;  Thomp- 
son. Chancellor. 

Bill  by  .James  J.  Wilson  ajrainst  George  J. 
Spear  and  wife  to  have  a  voluntary  convey- 
.anee  by  him  to  the  wife  set  aside  as  in  fi-aud 
of  creditors.  JFi'om  a  decree  for  plaintiff, 
defendants  appeal.     Reversed. 

French  &  Southgate.  for  appellants.  J.  J. 
Wilson,  pro  se. 

MUNSON.  J.  On  the  liSth  of  November, 
1SS.J.  the  defendant  George  .1.  Spear  received 
from  one  Parkhurst  a  deed  of  one  undivided 
half  of  his  farm.  In  the  fall  of  1SS7  said 
Spear  purchased  the  other  undivided  half  of 
the  farm,  and  had  Parkhurst  convey  it  to 
his  wife,  the  defendant  Eva  B.  Spear.  The 
consideration  for  both  conveyances  was  paid 
by  ( Jeorge  .J.  Spear  from  his  own  means.  On 
the  31st  day  of  December,  18S7,  George  J. 
Sptar  executed  to  one  Beach  a  deed  of  the 
undivided  half  conveyed  him  by  Parkhurst, 
and  on  the  16th  day  of  January,  ISSS,  Beach 
conveyed  the  same  to  Eva  B.  Spear.  The 
master  finds  that  the  defendant  George  had 
this  property  conveyed  to  his  wife,  the  de- 
fendant Eva,  "for  the  reason  that  he  thought 
the  same  would  be  safer  in  her  hands  than 
in  his  own.  from  attachment  by  his  credit- 
ors," of  whom  the  orator  was  one.  This  is 
a  sufficient  finding  that  the  transfer  was 
made  with  intent  to  defraud  the  orator. 
There  is  no  finding  that  connects  the  de- 
fendant Eva  with  the  fraudulent  pui-pose 
of  her  husband.  Upon  the  question  of  con- 
sideration, the  master  says  he  is  "'unable  to 
find"  that  the  defendant  Eva  paid  anything 
for  the  farm, — which  cannot,  of  itself,  be 
treated  as  an  affirmative  finding  that  nothing 
was  paid.  But,  as  the  master  says  in  this 
connection  that  the  defendant  husband  had 
the  same  conveyed  to  his  wife  to  keep  it 
fi-om  his  creditors,  it  is  thought  by  a  majori- 
ty of  the  court  that  the  payment  of  a  con- 
sideration is  fairly  negatived.  The  master 
also  reports  certain  facts  in  regard  to  the 
grantor's  Indebtedness  and  unconveyed  prop 
erty  which  it  will  not  be  necessary  to  con- 
sider. It  appears  that  a  part  of  the  orator's 
account  accrued  after  the  conveyances  were 
made,  but  the  case  will  first  be  considered 
as  if  the  entire  demand  were  pre-existing. 
We  have,  then,  the  case  of  a  voluntary  con- 
veyance, executed  with  an  actual  intent  to 
defraud  an  existing  creditor,  to  be  passed 
upon  without  reference  to  the  amount  and 
availability  of  the  property  retained. 

In  disposing  of  the  question  stated,  it 
seems  desirable  to  make  some  reference  to 
the  cases,  in  view  of  the  frequent  failure  to 
distinguish  carefully  between  fraudulent 
conveyances  upon  consideration,  and  convey- 
ances without  consideration,  and,  in  the  case 
of    voluntary    conveyances,    between    those 


which  rest  upon  a  legal  inference  of  fraud, 
and  those  where  an  actual  fraudulent  in- 
tent is  shown.  When  the  conveyance  is 
without  valuable  consideration,  the  creditor 
may  avoid  it  for  the  fraud  of  the  grantor 
alone.  Poster  v.  Foster,  5(3  Vt.  TAO.  54S.  It 
is  only  when  there  is  a  valuable  considera- 
tion that  fraud  on  the  part  of  the  grantee 
is  essential.  Such  were  the  cases  of  Root 
V.  Reynolds,  32  Vt.  139;  Leach  v.  Francis, 
41  Vt.  070;  Nichols  v.  Nichols,  01  Vt.  426, 
IS  Atl.  153.  The  fraud  of  a  voluntary  gran- 
tor may  be  an  actual  fraudulent  purpose,  or 
the  fraud  which  the  law  imputes  to  him  from 
the  condition  of  his  estate  and  the  neces- 
sary consequence  of  his  act.  AVhen  the  gran- 
tor is  foimd  to  have  c-onveyed  for  the  ex- 
press purpose  of  defrauding  his  creditors, 
the  condition  of  his  estate  is  immaterial. 
Wadsworth  v.  Williams.  100  Mass.  120;  Ha- 
ger  V.  Shindler,  29  Cal.  47;  Westerman  v. 
Westerman,  25  Ohio  St.  .500;  Gormley  v. 
Potter,  29  Ohio  St.  597;  Vasser  v.  Hender- 
son, 40  Miss.  519;  Edmunds  v.  Mister,  5S 
Miss.  765.  It  is  only  in  cases  where  no 
actual  fraud  appears  that  the  conveyance 
can  be  sustained  on  the  ground  that  the 
grantor  retained  sufficient  property  to  satis- 
fy his  debts.  Of  this  character  were  the 
cases  of  Brackett  v.  Wait,  4  Vt.  389;  Dewey 
V.  Long,  25  Vt.  564;  Church  v.  Chapin,  35 
Vt.  223;  Wilbur  v.  Nichols,  61  Vt.  432,  18 
Atl.  1.54.  It  appears,  then,  that  the  orator, 
as  an  antecedent  creditor,  can  avoid  these 
conveyances  without  other  findings  than  that 
they  were  designed  by  the  grantor  to  de- 
fi-aud  his  creditors,  and  were  without  con- 
sideration. 

Upon  the  facts  reported,  the  disposition  of 
the  case  is  not  affected  by  the  finding  that  a 
part  of  the  account  was  for  services  rendered 
after  the  conveyances  were  made.  The  char- 
ges were  for  the  orator's  services  and  dis- 
bursements as  attorney  in  a  single  suit.  If 
the  conveyance  was  designed  to  defraud  the 
orator,  it  was  an  attempt  to  defeat  the  col- 
lection of  his  compensation  for  a  continuing 
sei-vice,  rendered  and  to  be  rendered  under 
an  employment  already  given.  It  is  iwssible 
that  in  a  case  of  this  character  the  entire  ac- 
count should  be  treated  as  pre-existing.  If 
this  would  not  be  permissible,  there  is  au- 
thority for  saying  that  the  orator  could  have 
relief,  to  the  extent  of  the  pre-existing  char- 
ges, notwithstanding  the  judgment  was  for 
more.  Henderson  v.  Hendei-son,  133  Pa.  St. 
399,  19  Atl.  424.  It  has  been  held,  how- 
ever, that  one  who  takes  a  judgment  cov- 
ering both  antecedent  and  subsequent  claims 
must  be  treated  as  a  subsequent  creditor  as 
to  all.  Usher  v.  Hazeltine,  5  Greenl.  471. 
But,  if  enough  appears  to  avoid  the  convej-- 
ance  as  to  subsequent  creditors,  it  will  not 
be  necessary  to  consider  the  questions  sug- 
gested. It  is  said  in  McLane  v.  Johnson.  43 
Vt.  48,  that  a  conveyance  without  considera- 
tion, and  with  fraudulent  intent,  is  invalid  as 
to  both  existing  and  subsequent  creditors. 
But  that  was  a  case  in  which  the  fraudulent 


252 


AVOIDANCE  OF  CONTRACT. 


intent  existed  in  both  grantor  ami  grantee. 
It  is  by  no  means  iniiversally  coneedod  that 
a  volnntary  conveyance  to  an  innocent  gran- 
toe,  void  as  to  existing  creditors,  is  neces- 
sarily void  as  to  all  subsequent  creditors. 
Hagernian  v.  Buchanan  (N.  J.  Eit.  &  App.) 
14  Am.  St.  Rep.  750,  note,  17  Atl.  94G.  But  a 
consideration  of  this  question  will  be  uuneces- 
saiy,  if  it  suthciently  appears  that  there  was 
an  actual  intent  to  prevent  the  collection  of 
the  grantor's  subsequent  account.  In  view 
of  the  character  of  the  claim,  the  finding  of 
an  intent  to  defraud  the  orator  must  be  held 
to  apply  to  both  parts  of  his  demaiad.  We  have, 
then,  a  finding  of  an  intent  to  defraud  the 
orator  as  a  subsequent  creditor.  A  voluntary 
conveyance,  made  with  an  intent  on  the  part 
of  the  gi-antor  to  defraud  subsequent  creditors, 
is  void  as  to  such  creditors,  without  proof  of 
fraud  on  the  part  of  the  grantee.  Laughton 
V.  Harden,  68  Me.  208.  And,  there  having 
been  this  actual  intent  to  defraud  the  orator 
of  his  claim  for  the  services  to  be  thereaft- 
er rendered,  the  deed  would  be  void  as 
against  such  claim,  notwithstanding  the  pos- 
session of  other  property.  Nor  is  a  different 
disposition  of  the  case  required  by  the  fact 
that  the  conveyance  w-as  to  the  grantor's 
wife.  It  is  true  that  a  voluntary  conveyance 
to  wife  or  child,  which  does  not  impair  the 
grantor's  ability  to  pay  his  existing  debts, 
and  is  without  fraudulent  design,  will  be  sus- 
tained. Brackett  v.  Wait,  4  Vt.  380;  Jones 
V.  Clifton,  101  U.  S.  225.  But  a  deed  execut- 
ed in  actual  fraud  cannot  be  sustained  on 
the  ground  that  the  grantee  is  one  whom  it 
is  the  grantor's  dutj'  to  provide  for.  These 
conveyances  were  not  designed  to  effect  a 
settlement,  but  to  perpetrate  a  fraud.  The 
findings  are  inconsistent  with  the  theory  of 
a  gift  to  the  wife.  The  property  was  trans- 
ferred to  the  wife  because  the  husband 
thought  it  would  be  safer  in  her  name.  The 
actual  fraudulent  purpose  vitiates  the  con- 
veyance, notwithstanding  the  grantor's  pos- 
session of  other  property,  the  innocence  of 
the  grantee,  and  the  consideration  of  affec- 
tion. 

The  finding  that  George  J.  Spear  had  the 
farm  conveyed  to  his  wife  is  regarded  by  a 
majority  of  the  court  as  being,  in  effect,  a 
finding  that  Beach  took  his  deed  of  an  undi- 
vided half  merelj'  to  enable  Spear  to  trans- 
fer it  to  his  wife,  and  that  in  coiiveying  to 
Mrs.  Spear  he  passed  the  title  as  it  was  re- 
ceived. This  being  so,  Beach  is  not  a  neces- 
sary party  to  a  proceeding  to  set  aside  his 
deed  from  Spear,  and  the  half  which  Mrs. 
Spear  obtained  through  him  can  be  reached 
as  the  case  stands.  Day  v.  Cummings,  19 
Vt.  4S>6.  But  the  orator  can  have  no  relief 
as  regards  the  half  which  Mrs.  Spear  receiv- 
ed by  and  from  Parkhurst,  in  a  proceeding 
to  which  Parkhurst  is  not  a  party.  An 
avoidance  of  her  deed  of  this  half  would 
leave  the  property  in  Parkhurst,  and  the 
orator  cannot  avoid  her  title  to  a  share 
which  he  is  not  in  a  position  to  obtain.  This 
will  require  a  reversal  of  the  decree. 


The  orator's  proceedings  at  law  are  clear- 
Ij'  sutticient  to  entitle  him  to  equitable  relief. 
The  levy  of  execution  is  not  defective  iu  the 
particulars  complained  of.  The  officer's  re- 
turn shows  a  compliance  with  the  require- 
ments of  the  statute  regarding  notice  and 
adjournment  of  sale.  The  return  is  evidence 
that  the  newspaper  in  which  the  notice  was 
published  was  one  of  general  circulation  in 
the  vicinity.  We  think  counsel  are  incorrect 
in  saying  that  this  is  not  within  the  rule 
laid  down  iu  Swift  v.  Cobb,  10  Vt.  282.  It 
was  the  otRcer's  duty  to  publish  the  notice 
in  a  uewsi  aper  of  a  certain  description.  Hi& 
return  is  evidence,  not  only  that  he  published 
it  in  the  paper  named,  but  that  the  paper 
was  such  as  the  statute  prescribed. 

The  failure  of  the  officer  to  deliver  a  deed 
of  the  property  until  long  after  the  expira- 
tion of  the  time  limited  for  redemption,  and 
until  after  the  bringing  of  this  bill,  is  not 
a  bar  to  the  orator's  relief.  The  deed  is  to 
be  given  effect  from  the  time  when  it  should 
have  been  delivered.  It  is  well  settled  that 
the  doctrine  of  relation  will  be  applied  to 
sustain  the  title  of  the  purchaser  at  an  exe- 
cution sale.  Jackson  v.  Ramsay.  3  Cow.  75. 
15  Am.  Dec.  242,  and  note.  The  case  cited 
was  an  ejectment  suit,  in  which  the  defend- 
ant relied  upon  a  sheriff's  deed  executed  aft- 
er the  action  was  commenced  and  issue  join- 
ed therein;  and  it  was  held  that  the  deed 
had  relation  to  the  time  of  sale,  and  that 
the  defendant  could  avail  himself  of  it  with- 
out pleading  it  as  a  matter  of  defense  aris- 
ing after  issue  joined. 

The  fact  that  the  term  of  office  during 
which  the  sale  was  made  expired  before  the 
deed  was  executed  does  not  render  it  invalid. 
Counsel  have  not  referred  to  R.  L.  §  800,  and 
its  application  to  this  question  need  not  be 
considered.  It  is  certain  that  an  express 
statutory  provision  is  not  necessary  to  se- 
cure the  complete  execution  of  process  which 
is  being  served  by  an  officer  when  his  term 
expires.  In  the  case  of  a  levy  upon  personal 
property,  it  is  universally  held  that  the 
service  is  to  be  completed  by  the  officer  who 
made  the  levy,  notwithstanding  the  close  of 
his  term.  It  is  generally  considered  that 
this  rule  of  the  common  law  is  applicable  to 
the  service  of  executions  under  statutory 
provisions  for  the  sale  of  real  estate,  but 
some  authorities  hold  that  in  the  case  of  real 
estate  the  service  must  be  completed  by  the 
new  incumbent.  Tukey  v.  Smith,  36  Am. 
Dec.  705.  note.  The  giving  of  a  deed  for 
land  sold  while  in  office  is  a  part  of  the  exe- 
cution of  the  process,  which  may  be  done 
after  the  expiration  of  the  term.  Allen  v. 
Trimble,  4  Bibb.  21.  It  is  not  necessary  to 
determine  here  whether  the  acts  required 
after  the  expii-ation  of  the  term  should  be 
done  by  the  former  officer,  or  by  his  suc- 
cessor; for  in  this  case  the  deed  was  given 
by  the  same  person  who  made  the  sale, 
while  he  was  filling  the  same  office  by  virtue 
of  a  reappointment.  Decree  reversed,  and 
cause  remanded,  with  mandate. 


AVOIDANCE  OF  COXTKACT. 


BRESNAHAN  v.   NUGENT. 

(52  N.  W.  735,  92  Mich.  7G.) 

Supreme   Coui't    of    Miuliigan.    June    10,   1892. 

Ei'i'or  to  circuit  court,  Kent  county;  Allen 
•C.   Adsit,   Juclj;e. 

Action  by  John  Bresnaljan,  atluiiuistrator  of 
llie  estate  of  Daniel  Nugent,  deceased,  against 
Emanuel  Nugent,  under  How.  St.  §§  58S4, 
5885,  to  recover  for  the  benefit  of  decedent's 
creditors  for  certain  personal  property  fraudu- 
lently transferred  by  decedent  to  defendant. 
i'"roin  a  judgment  for  plaintili',  defendant  ap- 
l)eals.      Reversed. 

Taggait,  Wolcott  &  Gnnson,  foi-  appellant. 
J.  H.  Tatem  and  James  Nugent,  for  appellee. 

M()NT(j;OMEIlY,  J.  On  the  2'Jth  of  April, 
187U,  Daniel  Nugent,  by  bill  of  sale,  trans- 
foried  all  liis  personal  property  to  his  brother 
Emanuel  Nugent,  the  defendant,  and  imme- 
diately left  the  state.  Daniel  was  last  heard 
from  in  September,  1S79,  and  after  the  lapse 
of  seven  years  from  that  time  letters  of  ad- 
ministration were  issued  to  the  i^laintiff. 
.Fames  Nugent  presented  claims  which  were 
allowed  against  the  estate,  as  follows:  First, 
a  joint  note  made  by  James  and  Daniel  Nu- 
gent to  John  Nugent,  dated  April  S,  1S7G,  and 
payable  one  year  from  date,  for  $191,  less  in- 
dorsements; second,  two  notes  for  $150  and 
$;iUO.  respectively,  each  bearing  date  Sep- 
tember 11,  1878,  and  payable  to  Mary  Nu- 
gent or  bearer,  and  due  three  years  from  date 
Avith  interest;  third,  one  note  for  $400,  given 
to  Mary  Nugent,  of  the  same  date,  and  pay- 
able live  years  from  date,  with  interesi; 
fourth,  a  claim  for  support  of  Mary  Nugent 
iind  Cecelia  Nugent,  mother  and  sister  of 
Daniel  Nugent,  amounting  to  $094.58,  with 
interest,  which  support  Daniel  Nugent  had 
agreed  to  furnish  by  contract  with  Mary  Nu- 
gent, which  contract  was  by  her  assigned  to 
James.  No  property  came  into  the  hands  of 
the  administrator,  and  this  suit  is  brought  un- 
der sections  5884  and  5885  of  Howell's  Stjit- 
utes,  under  a  claim  that  the  personal  prop- 
erty transferred  to  Emanuel  was  so  trans- 
ferred in  fraud  of  creditors.  The  plaintiff  re- 
covered a  judgment  of  $;i. 052.29.  and  defend- 
ant Inings  error. 

1.  The  plaintiff  described,  in  the  first  count 
of  his  declaration,  the  personal  property 
claimed  to  have  been  transferred,  including  in 
tlie  description  953  bushels  of  wheat.  He 
also  appended  the  common  counts  for  goods 
sold  and  delivered  and  the  money  counts,  but 
nowhere  alleged  any  transfer  of  real  prop- 
erty. The  plaintiff  was  permitted  to  show 
that  at  about  the  same  date  as  the  transfer 
of  the  personalty  a  deed  of  lands  upon  which 
wheat  was  standing  growing  was  made,  and 
that  it  afterwards  harvested  and  threshed  out 
9.53  bushels  or  thereabouts.  This  was  error. 
The  conveyance  of  the  land  was  confessedly 
good  as  against  Daniel,  and  the  wheat  grow- 
ing upon  the  land  passed  by  the  conveyance. 
The  pleadings  in  this  case  did  not  apprise  the 


dufcniiant  of  any  attcnu't  to  attack  such  con- 
ve.\-ance,  even  if  it  were  possible  to  treat  the 
wheat  as  perscjnal  property  belonging  to  Dan- 
iel, without  first  setting  aside  the  convey- 
ance,—a  question  not  involved,  and  which  we 
do  not  decide.  But  if  the  product  of  the 
land  could  be  thus  treated  for  this  year  it 
might  with  equal  propriety  be  open  to  the 
plaintiff;  to  reap  the  benefit  of  all  crops  since 
grown  upon  the  land,  without  regard  to  the 
labor  invohed  in  producing  them. 

2.  A  ]iortion  of  the  property  transferred 
was  exemijt.  The  recovery  did  not  exclude 
this.  This  is  error.  It  has  been  fre<iuei!tly 
held  that  a  creditor  cannot  complain  of  any 
disposition  which  a  debtor  sees  fit  to  make 
of  exempt  proi)erty.  Buckley  v.  ^Vheeler,  52 
Mich.  1,  17  N.  W.  210;  Fischer  v.  Mclntyre.  00 
Mich.  081.  33  N.  Vv'.  702;  Freehliug  v.  B.es- 
nahan,  01  Mich.  540,  28  N.  W:  531. 

3.  Complaint  is  justly  made  of  testimony 
which  related  to  family  jars  subsiMjuent  to 
the  purchase,  and  of  testimony  relating  to  de- 
fendant's treatment  of  his  sistei-s.  These 
transactions  had  no  beai'ing  upon  the  issue 
here  involved.  Without  referring  to  the  nu- 
merous objections  in  detaii,  one  may  be  staled 
by  way  of  illustration.  Joseph  Nugent,  who 
resides  in  Iowa,  came  to  Michigan  in  March, 
1880,  and  was  peimitted  to  testify  that  he 
■•found  all  the  coimections  were  in  a  hostile 
camp;  Emanuel  on  one  side  alone,  and  the 
family  and  all  the  connections  on  the  other 
side."  This  was  not  only  irrelevant,  but  well 
calculated  to  prejudice  the  jury. 

4.  Mary  Nugent,  in  her  lifetime,  brought 
suit  against  Daniel,  and  attached  a  portion  of 
the  personal  property  transferred.  Emanuel 
brought  replevin  against  the  sheriff,  and 
.James,  as  assignee  of  his  mother,  defended 
the  suit  on  the  ground  that  the  bill  of  sale,  as 
against  Daniel's  creditors,  was  fraudulent. 
This  defense  prevailed,  and  the  jury  found 
specially  that  such  transfer  was  fraudulent  as 
against  the  creditors  of  Daniel.  The  circuit 
judge  charged  the  jury,  in  effect,  that  this 
judgment,  rendered  between  privies  of  the 
parties  to  this  suit,  was  conclusive  as  to  the 
fact  of  the  fraudulent  character  of  the  trans- 
fer. Complaint  is  made  of  this  ruling,  but  we 
think  it  right.  The  question  is  not  whether 
defendant  would  be  concluded  as  to  all  ques- 
tions which  might  have  been  tried,  as  was 
contended  in  Jacobson  v.  Miller,  41  Mich.  90, 
1  N.  W.  1013,  but  in  this  case  the  question 
of  fraud  was  in  fact  tried,  and  it  was  precise- 
ly the  same  question  as  is  here  involved,  and 
between  the  privies  of  the  parties  here  before 
the  court.     Barker  v.  Cleveland,  If)  .Mich.  230. 

5.  The  defendant  also  relied  on  the  statute 
of  limitations,  but  tiie  circuit  judge  disalloweil 
the  defense.  The  question,  as  it  arises  on 
this  record,  is  novel.  Any  action  of  Daniel 
against  Emanuel  would,  of  course,  be  barred; 
but  does  it  follow  that  an  action  by  or  for 
the  use  of  the  creditors  is  likewise  barred? 
In  this  case  to  so  hold  would  be  to  exclude 
the   creditor   from   all   remedy.     The   right   of 


254 


AVOIDANCE  OF  CONTRACT. 


action  in  favor  of  tlie  crtHlilor  does  not  accine 
until  the  maturity  of  tlie  obligatious  aj^aiiist 
Daniel,  wliieli,  in  the  case  of  one  of  the  notes, 
was  nut  until  18So,  and,  iu  case  of  the  as- 
signed claim  for  support,  until  1884;  but  not 
only  is  this  true,  but  it  is  also  true  that  the 
creditor  could  not  by  the  ordinary  process  at- 
tack such  tran;-*fer  until  a  judgment  had  beeu 
obtained  against  Daniel,  so  that  to  hold  that 
this  right  of  action  is  barred  is  to  hold  that 
the  action  may  be  barred  before  the  statute 
begins  to  run.  It  is  suggested  that  tlie  de- 
fendant might  have  been  charged  as  a  gar- 
nishee in  a  suit  against  Daniel.  This,  it  is 
true,  might  have  beeu  done  after  the  maturity 
of  the  claims  if  the  plaintiff  was  able  to 
make  the  statutory  affidavit,  but,  so  far  as 
the  relation  of  defendant  is  concerned,  he 
would  in  no  sense  be  a  defendant  iu  an  action 
of  trover,  on  the  case,  or  in  assumpsit,  and 
therefore  not  within  the  protection  of  the 
statute,  (section  8713.)  The  fact  that  in  such 
action  by  ancillary  proceedings  an  attempt 
might  be  made  to  charge  the  defendant  as  a 
trustee,  and  his  oath  taken,  and  proceedings 
had  upon  them,  does  not  consruute  such  suit 
an  action  of  assumpsit,  replevin,  or  trover 
against  him  within  the  meaning  of  this  stat- 
ute. 

G.  In  ISSo.  Mary  Nugent  joined  with  others 
iu  filing  a  bill  against  Emanuel,  alleging  that 
this  property  was  conveyed  by  Dariel  in  trust 
for  his  creditors.  This  bill  was  demurred  to, 
and  dismissed  without  prejudice.  It  is  now 
claimed  that  this  estops  James,  who  is  iu  priv- 
ity with  Mary,  from  attacking  Ihe  convey- 
ance as  fraudulent,  but  we  think  this  position 
is  not  tenable.  There  was  no  declared  trust, 
and  none  recognized  by  Emanuel,  and,  as  it 
now  appears  that  the  transfer  was  fraudulent 
as  to  creditors,  it  is  conclusive  also  that  there 
was  no  trust  which  could  be  enforced  by  a 
bill  in  equity  by  those  who  are  not  judgment 
creditors.  It  is  suggested  that,  as  this  claim 
of  estoppel  does  not  appear  to  have  been  liti- 
gated in  the  replevin  suit.  tliC  estojjpel  of  that 
judgment  as  to  this  question  extends  only  to 
the  subject-matter  therein  involved;  but  this 
contention  ignores  the  fact  that  the  finding  in 
that  case  established  conclusively  that  the 
transfer  of  this  personal  property  was  fraudu- 
.  lent,  and  made  under  such  circumstances  that 
one  not  a  judgment  creditor  could  have  no 
remedy  by  a  bill  in  equity.  An  ineffectual 
attempt  to  enforce  a  claim  which  has  no  legal 
e.xistence  does  not  estop  a  party  from  there- 
after asserting  one  which  is  valid.  Rodman 
v.  Railioad  Co..  .59  Mich.  395,  26  N.  W.  6")!; 
Detroit  v.  Houghton,  42  Mich.  459,  4  N.  W. 
371,  287.  For  the  errors  pointed  out  the  judg- 
ment below  should  be  reversed,  and  a  new 
trial  ordered. 

LONG,  J.,  concurred  with  MONTCIOM- 
KRY.  .T. 

Mc(iUATH.  J.  In  April.  1879.  Daniel  Nu- 
gent conveyed  to  the  defendant,  his  lirother.  a 
farm  of  2(X)  acres  of  land,  with  growing  crops. 


and  the  stock,  farm  implements,  and  other 
personal  property  thereon,  and  soon  after  left 
the  state,  and  never  returned.  Daniel  was  in- 
debted at  the  time  of  his  departure,  upon  three 
notes,  amounting  to  .$850,  dated  September  11,. 

1878,  two  of  them  running  three  years,  and 
one  payable  in  live  years;  and  upon  one  note, 
amounting  to  .$191,  dated  April  6,  187G,  pay- 
able one  year  from  date,  upon  which  .$45  had 
been  paid  September  15,  1877.  He  was  under 
other  obligations  for  the  care  and  support  of 
his  mother  and  sister.  These  notes  and  obli- 
gatious were  subsequently,  in  August,  1884. 
assigned  to  .James  Nugent.  Daniel  was  heard 
from  after  his  departure,  but  a  period  of  seven 
yean;  elapsed  after  he  was  last  heard  from, 
and  in  May,  1888,  letters  of  administration 
were  taken  out  upon  his  estate.  Commission- 
ers on  claims  were  appointed,  and  James  Nu- 
gent present'^d  and  had  allowed  claims  aggre- 
gating nearly  $2,.5(X>  on  the  notes  and  obliga- 
tions aforesaid.  The  administrator  was  ap- 
pointed in  1886  or  1887,  and  in  October,  1890. 
he  brought  assumpsit  under  How.  Ann.  St. 
§  5884,  alleging  the  sale,  transfer,  and  deliv- 
ery in  April,  1879,  of  the  personal  property  by 
Daniel  Nugent  to  defendant,  its  disposition, 
a  deficiency  of  assets,  and  that  the  sale  made 
to  defendant  was  without  consideration,  and 
was  made  with  intent  to  defratid  creditors. 

Defendant  set  up  the  statute  of  liniil:ations. 
How.  Ann.  St.  §  5884,  is  as  follows:  "When 
there  shall  be  a  deficiency  of  assets  in  the 
hands  of  an  executor  or  administrator,  and 
when  the  deceased  shall,  in  his  lifetime,  have 
conveyed  any  real  estate,  or  any  right  or  in- 
terest therein,  with  the  intent  to  defraud  his 
creditors,  or  to  avoid  any  right,  debt,  or  duty 
of  any  person,  or  shall  have  so  conveyed 
such  estate  that  by  law  the  deeds  or  convey- 
ances are  void  as  against  creditors,  the  ex- 
ecutor or  administrator  may,  and  it  shall  be 
his  duty  to,  commence  and  prosecute  to  final 
judgment  any  proper  action  or  suit,  at  law 
or  in  chancery,  for  the  recoA-ery  of  the  same, 
and  may  recover,  for  the  benefit  of  the  cred- 
itors, all  such  real  estate  so  fraudulently  con- 
veyed; and  may  also,  for  the  benefit  of  tlu^ 
creditors,  sue  and  recover  for  all  goods,  chat- 
tels, rights,  or  credits  which  may  have  been 
so  fraudulently  conveyed  by  the  deceased  in 
his  lifetime,  whatever  may  have  been  the 
manner  of  such  fraudulent  conveyance."  The 
statute  provides  that  all  actions  of  assumpsit, 
all  actions  of  replevin  or  trover,  and  all  other 
actions  for  taking  and  detaining  goods  and 
chattels,  shall  be  commenced  within  six  years 
after  the  cause  of  action  shall  accme.  and  not 
afterwards.  Id.  §  8713.  The  present  action 
is  predicated  upon  a  fraudulent  conveyance 
of  the  personal  property  to  defendant  in  April, 

1879.  It  is  to  recover  the  amount  of  four 
notes,  one  of  which  matured  in  1877,  eleven 
years  before  Daniel  Nugent's  deatli.  and  thir- 
teen years  before  the  commencement  of  this 
suit;  two  of  which  matured  in  1881,  seven 
years  before  Daniel's  death,  and  nine  yeai-s 
before  this  suit  was  commenced;    and  one  ot 


AVOIDANCE  OF  CONTRACT. 


wliicli  matured  in  1883,  five  j'ears  before  Dan- 
iel's death,  and  seven  years  before  this  suit 
was  commenced;  and  also  upon  a  claim  for 
the  care  and  support  of  the  mother  and  sister, 
tlie  last  item  of  which  is  dated  Autiiist  l(i, 
1884.  It  is  unnecessary,  in  the  present  case, 
to  determine  whether  or  not  the  statute  com- 
menced to  run  in  favor  of  defendant  from  the 
time  of  the  conveyance  or  conversion,  for  here 
moi'e  than  six  years  elai)sed  after  all  the 
claims  against  Daniel  matured  before  this  suit 
was  brought.  The  statute  makes  convey- 
ances with  intent  to  defraud  creditors  voida- 
l)le  at  the  instance  of  creditors.  For  more 
than  six  years  no  attack  was  made  upon  the 
conveyance  of  the  property,  the  recoveiy  of 
the  value  of  which  is  here  sought.  It  is  im- 
material whether  a  promise  or  trust  be  im- 
plied. The  statute  runs  against  an  implied, 
as  well  as  an  express,  promise;  and  where  a 
trust  is  created  by  implication  of  law  the  stat- 
ute commences  to  i-un  from  the  repudiation 
of  the  trust.  The  statute  certainly  commen- 
ced to  lun  in  favor  of  defendant  and  against 
the  creditors  at  the  time  that  the  maturity  of 
their  debts  placed  them  in  a  position  to  fol- 
low the  property.  The  absence  or  death  of 
Daniel  Nugent  did  not  intermpt  tlie  running 
of  the  statute  in  favor  of  defendant.  A  cause 
of  action  may  accrue  against  one  absent  from 
the  state,  but  by  virtue  of  express  provisions 
the  statute  does  not  operate  until  his  return. 
A  cause  of  action  may  accrue  after  the  death 
of  either  partj-,  but  because  the  statute  so  pro- 
vides the  time  does  not  begin  to  run  until  the 
appointment  of  an  administrator.  Suits  may 
be  commenced  in  such  cases,  not  because  the 
cause  of  action  did  not  accrue  imtil  the  dis- 
ability was  removed,  but  because  the  period 
is  expressly  extended  beyond  the  disal)ility. 
7  Am;  (fc  Eng.  Euc.  Law.  p.  oT(j.  and  cases 
cited.  Here,  Daniel's  absence  and  death  kept 
alive  the  claim  of  the  creditors  as  against 'him 
and  his  estate,  but  the  al)sence  of  Daniel  did 
not  defer  the  accrual  of  the  right  of  action  in 
favor  of  the  creditors,  and  the  death  of  Dan- 
iel did  not  toll  the  statute  as  against  defend- 
ant, becaiLse  such  a  case  is  not  within  the 
statute.  The  statute,  being  general,  must 
operate  upon  all  cases  wliicli  are  not  exempt- 
ed by  express  exemption.  4  Bac.  Abr.  47.j. 
After  the  right  of  action  once  attached,  and 
the  statute  had  commenced  to  run  against  the 
creditors,  if  the  death  of  Daniel  Nugent  in  any 
wise  affected  their  ability  to  pursue  their  rem- 
edy, that  was  a  disability  not  within  the  con- 
templation of  the  statute,  and  tlie  statute  con- 
tinued to  ran  notwithstanding.  Ten  Eyck  v. 
Wing.  1  Mich.  40-46. 

Section  .j884  provides  for  the  bringing  of 
any  proper  action  or  suit.  It  cannot  be  con- 
tended that  it  was  the  intention  of  the  legis- 
lature to  revive  rights  of  action  in  favor  of 
creditors,  which  have  been  barred  by  the 
statute  of  limitations.  The  creditors  might 
have  proceeded  under  chapter  277,  How.  Ann. 
St.  §§  8087-8089;  in  trover  or  assumpsit  for 
the    jiropertj'    in   question.     This   statute,    like 


all  others  empowering  e.vecutors  or  adminis- 
trators to  bring  .suits,  must  be  construed  with 
reference  to  otlier  statutes  relating  to  actions, 
riglits  of  action,  and  remedies.  The  construc- 
tion contended  for  would  defeat  the  very  i)ar- 
pose  of  statutes  of  repose  by  enabling  an  ad- 
ministrator to  revive  actions  against  which 
the  statute  had  run,  and  to  bring  trover  for  a 
conversion  happening  half  a  century  before 
the  commencement  of  suit.  Certain  rights  uf 
action  .survive  to  executors  and  administra- 
tors in  favor  of  the  estate,  but  only  those 
against  which  the  statute  had  not  run.  Thi.>? 
statute  gives  to  them  certain  riglits  of  action 
in  favor  of  creditors,  but  it  cannot  be  con- 
strued as  giving  them  a  right  of  action  in 
favor  of  a  creditor  where  the  full  period  of 
the  statute  has  run  in  favor  of  the  person 
sought  to  be  cliarged  and  against  the  creditor. 
As  is  said  by  Campbell,  .1.,  in  Blake  v.  Hub- 
bard, 45  Mich.  1,  4,  7  N.  W.  204:  "The  deci- 
sions on  the  subject  of  frauds  against  cred- 
itors do  not  hold  fraudulent  assignments  sc 
absolutely  void  that  the  parties  may  not  lose 
their  right  of  complaint  by  waiver  or  acfpii- 
esceuce."  In  Fearey  v.  Cummings.  41  Mich. 
.370-384,  1  N.  W.  040,  it  is  said  that  section 
8091  1  is  contined  to  titles  and  conveyances 
of  such  property  as  the  garnishees  have  iu 
possession  at  the  time  of  making  the  affidavit. 
Upon  examination  of  the  record  in  that  ca.se 
it  appears  That  the  garuishtes  had  taken  a 
chattel  mortgage  upon  a  stock  of  goods,  but 
had  not  filed  it  until  the  day  upon  whicli 
they  took  possession;  but  they  claimed  that 
the  possession  which  they  took  was  not,  in 
fact,  under  the  mortgage,  but  by  virtue  of  a 
parol  understanding  under  which  the  debtor 
voluntarily  turned  over  the  goods  to  them  to 
enable  them  to  make  their  debt.  They  insist- 
ed that  such  voluntaiy  delivery  of  the  goods 
was  but  a  preference.  In  the  brief  of  comisel 
for  garnishees  the  point  is  made  that,  in  order 
to  bring  the  case  under  the  section  named, 
the  garnishees  must  be  holding  under  the 
void  title  at  the  time  of  the  garnishment. 
Fpon  the  second  trial  a  recovery  was  had 
against  the  garnishees,  and  the  judgment  was 
affirmed,  (44  Mich.  39,  6  N.  W.  98.)  althougli 
at  the  time  of  the  commencement  of  the  gar- 
nishee proceedings  the  stock  of  goods  had 
been  sold,  and  was  not  in  the  possession  of 
the  garnishees;  Graves.  .1.,  who  wrote  this 
opinion  in  the  first  case,  dissenting. 

It  appears  that  in  1883  Mary  Nugent  com- 
menced suit  on  certain  of  the  notes  by  at- 
tachment running  against  the  real  estate,  and 
recovered  judgment  in  February,  1883;  that 
che  then  filed  her  bill  against  Daniel  Nugent 
and    defendant    in    aid    of    this    levy,    but    in 

1  How.  Ann.  St.  §  8091.  provides  that,  "if 
nny  person  iraniisliod  shall  liavo  in  his  posst's- 
siou  any  of  the  property  aforesaid  of  the  prin- 
cipal defendant,  which  he  holds  by  a  convey- 
ance or  titfe  that  is  void  as  to  the  creditors  of 
the  defendant,  he  may  be  adjudged  liable  as 
frariiishee  on  account  of  such  property,  although 
the  principal  defendant  could  not  have  luain- 
tainod  an  action  therefor  against  him." 


256 


AVOIDANCE  OF  CONTRACT. 


April,  1S8S,  the  proceedings  were  held  defect- 
ive, :iud  were  set  aside.  In  May,  18S8,  ap- 
plication was  made  for  the  appointment  of  an 
administrator,  and  it  is  insisted  that  under 
How.  St.  §  8723,  this  right  of  action  has  been 
thereby  kept  alive.  That  was  a  proceeding  to 
subject  the  real  estate  to  the  payment  of  a 
claim  by  virtue  of  an  attachment.  This  is  an 
iiction  for  the  recovery  of  the  value  of  per- 
sonal property.  Not  only  is  the  form  of  ac- 
tion distinct,  but  the  subject-matter  is  dif- 
ferent. The  plea  of  tlie  statute  should  be  held 
good,  and  the  judgment  reversed,  with  costs 
of  both  courts  to  defendant. 

GRANT,  J.,  concurred  witli  McGRATH,  J. 

MORSE,  C.  J.  In  this  case  I  do  not  fully 
agree  with  either  of  the  opinions  filed  by  Jus- 
tices McGRATH  and  :\IONTGOMERY.  As  to 
the  note  of  .?191,  dated  April  8,  1876,  made  by 
James  and  Daniel  Nugent  to  John  Nugent, 
and  due  in  one  year,  the  statute  of  limitations 
had  begun  to  run  against  Daniel  before  he 
left  the  state,  and  it  was  therefore  in  a  shape 
to  take  proceedings  against  Daniel  when  the 
transfer  was  made  to  Emanuel.  Neither  in 
law  nor  equity  is  there  any  reason  why  Eman- 
uel, who  has  never  been  out  of  the  jurisdiction 
of  the  courts  of  this  state,  should  now  be  pro- 
ceeded against  for  the  amount  of  this  note, 
11  years  after  his  alleged  fraudulent  dealings 
v."ith  Daniel.  And  I  agree  with  Justice  Mc- 
GRATH that  the  notes  maturing  in  1881— 
seven  years  before  Daniel's  death — a  re  covered 
by  the  statute  of  limitations,  hut  as  to  the  note 
maturing  in  1883,  and  the  claim  for  support, 
which  accrued  in  1884,  the  statute  of  limita- 
tions, as  against  Daniel,  was  postponed  for  a 
peiif^d  until  the  appointment  of  an  adminis- 
trator, and  two  years  thereafter;  and  I  think 
also  as  against  Emanuel.  How.  Ann.  St.  § 
8722.  Bresnahan  was  appointed  administra- 
tor July  19,  1888,  but  appeal  was  taken  to 
the  circuit  court  by  Emanuel,  and  in  that 
court  the  order  of  the  probate  court  appoint- 
ing an  administrator  was  set  aside.  James 
appealed  the  matter  to  this  court,  where  the 
order  of  the  probate  court  was  affirmed  No- 
vember 8.  1889.  The  administrator  was 
therefore  not  appointed  until  the  decision  of 
this  court,  and  the  suit  was  commenced 
against  Emanuel  within  two  years  from  that 
date.     While    Daniel    was    living    and    absent 


from  the  state  Emanuel  could  have  been  pro- 
ceeded against  as  garnishee  of  Daniel  under 
sections  8087-8091,  How.  Ann.  St.,  and  the 
action  in  such  case  as  against  Emanuel,  the 
garnishee  defendant,  would  have  been  in  as- 
sumpsit or  trover.  Therefore,  if  the  creditor 
allowed  his  claim  against  Daniel,  upon  which 
he  bases  his  action  against  luuanuel,  to  sleep 
for  six  years  after  its  maturity,  he  has  lost 
such  right  of  action  because  of  the  statute  of 
limitations.  But  he  would  have  the  right  to 
commence  his  action  at  any  time  within  six 
years;  and  as,  in  order  to  reach  Emanuel,  he 
must  make  Daniel  a  party  to  the  suit  or  gar- 
nishee proceedings,  it  follows  that,  as  to  the 
notes  and  claims  which  had  not  rim  six  years 
from  matiu'ity  before  Daniel's  death,  the  cred- 
itors could  not  proceed  until  an  administrator 
was  appointed,  and  then  I  think  they  would 
be  entitled  to  the  two  additional  years  provid- 
ed by  statute  against  Emanuel  as  well  as  Dan- 
iel's estate. 

It  was  said  by  Justice  Graves  in  Fearey  v. 
Cummings,  at  page  384,  41  Mich.,  and  page 
80,  1  N.  W.,  that  the  right  given  by  section 
8091,  How.  Ann.  St.,  to  assail  conveyances 
set  up  by  garnishees  on  the  ground  of  being 
fraudulent  as  against  creditors,  is  confined  to 
conveyances  of  propertj-  then  in  the  hands  of 
the  garnishee  at  the  time  of  commencement 
of  the  garnishee  suit,  and  did  not  apply  where 
the  property  had  been  fi-auduleutly  received 
by  such  garnishee,  but  disposed  of  before 
suit.  I  think  this  language  evidently  refers  to 
property  passing  into  the  hands  of  the  gar- 
nishee, and  then  being  disposed  of,  passing 
out  to  another  or  to  the  original  owner,  and 
not  to  a  case  where  it  is  shown  that,  although 
the  garnishee  has  disposed  of  the  property  be- 
fore action  commenced  against  him,  he  still 
has  the  avails  of  such  propertj'  in  his  own 
hands,  or  has  converted  the  proceeds  of  the 
sale  of  It  to  his  own  use.  In  such  case  he 
has  money  and  effects  in  his  hands  belonging 
to  the  creditors  of  the  principal  defendant,  and 
the  words  "any  of  the  property  aforesaid," 
used  in  section  8091,  refer  not  simply  to  prop- 
erty- in  its  restricted  sense  of  goods  and  chat- 
tels, but  to  money  as  well,  which  is  pn)i)erty 
in  the  largest  and  proper  sense  of  the  word. 
In  my  opinion,  the  statute  of  limitations  has 
run  against  the  notes  falling  due  over  six 
years  before  the  death  of  Daniel.  I  therefore 
concur  iu  the  reversal  of  the  judgment. 


AV(tII>AXrE  OF  CUNTltACT. 


257 


NAvSH  V.  STEVENS  ot  ux. 
(65  N.  W.  825.) 
Supreme  Court  of  lowu.    Jan.  22.   IS'.fij. 
Appeal    frou'    district    court,    Sac    couuty: 
Charles  D.  Goldsiuith,  Judge. 

Action  in  equity  to  subject  land  to  the  pay- 
ment of  a  judgment.  There  was  a  hearing 
on  the  merits,  and  a  decree  for  the  defend- 
ants.    The  plaintiff  appeals.     Athrmed. 

R.  M.  Hunter,  for  appellant.  S.  M.  Ehvood, 
for  appellees. 

ROBINSON,  J.  On  and  before  the  1st  day 
of  June,  1875,  tht-  defendant  Benjamin  Ste- 
vens was  indebted  to  the  plaintiff  in  the  sum 
of  .?2UU.  In  August,  1875,  the  plaintiff  com- 
menced in  the  district  court  of  Tama  county 
an  action  ou  the  indebtedness,  to  recover  the 
amount  due,  and  in  February,  1877.  he  re- 
covered against  Stevens  judgment  for  $2(X) 
and  costs.  On  the  19th  day  of  June,  1875. 
Stevens  purchased  an  improved  farm,  of  ItJO 
acres,  situated  in  Tama  county,  for  the 
agreed  consideration  of  .?2.4(X>.  In  payment 
he  gave  a  note  for  .^(UX*  made  by  himself  and 
a  surety,  and  notes  for  the  aggregate  sum 
of  .SI, 800,  secured  by  a  mortgage  on  the 
land.  Three  days  after  the  action  against 
Steven.*!  on  the  indebtedness  stated  was  com- 
menced, and  before  he  had  paid  any  ^art  of 
the  purchase  price  of  the  laud,  he  conveyed 
it  to  his  wife  and  codefendaut.  Maggie  Ste- 
vens, by  a  deed  which  was  duly  recorded  on 
the  following  day.  The  deed  recited  a  con 
sideration  of  $000,  and  was  subject  to  the 
mortgage  of  .$1.<S<X).  Mrs.  Stevens  paid  noth- 
ing for  the  land  at  that  time,  but  assumed 
the  payment  of  the  notes  her  husband  had 
given  for  it.  In  the  year  1870  she  sold  the 
north  half  of  the  quarter  section  for  .$l,OlXi, 
which  she  applied  on  the  mortgage  debt.  In 
the  year  1882  she  sold  the  remainder  of  the 
land,  and  purchased  a  farm  of  120  acres  in 
Sac  county,  of  which  40  acres  were  broken. 
Improvements  have  been  made  on  that,  and 
it  has  been  occupied  by  the  defendants  as  a 
home  since  the  spring  of  1883.  The  judg- 
ment rendered  agitinst  Stevens  in  February, 
1877,  is  unpaid,  and  this  action  was  com- 
menced in  September,  1891,  to  subject  the 
Sac  county  land  to  the  payment  of  the  judg- 
ment. 

The  plaintiff  contends  that  the  considera- 
tion for  the  Tama  county  land  was  really  fur- 
nished by  Stevens,  and  that  his  conveyance 
to  his  wife  was  made  to  hinder  and  delay 
his  creditors,  and  was  therefore  fraudulent, 
and  that  the  title  to  the  Sac  county  land  was 
taken  in  the  name  of  the  wife  for  the  same 
purpose,  but  that  it  was  purchased  with  the 
proceeds  of  the  Tama  county  land,  and 
should  be  subjet'ed  to  the  payment  of  the 
plaintiff's  judgment,  and  a  decree  to  that  ef- 
fect is  asked.  The  defendants  claim  that  the 
Avile  paid  for  the  Tama  county  land  its  full 
value,  that  there  is  no  ground  for  granting 

VAN  ZILE  SEL. CAS. SALES — 17 


f  the  relief  for  which  the  plaintiff  asks,  and 
that  the  action  is  barred  by  the  statute  of 
limitations.  The  defense  Last  stated  is  the 
OTJly   one   v.-e   find    it   neces^sary   to    consider. 

1  The  plaintiff  insists  that  it  was  not  suttiiicul- 
ly  pleaded,  but  we  are  of  the  opinion  that  it 
was,  especially  in  the  absence  of  objection 
made  in  the  district  court.  Actions  in  equity 
for  relief  on  the  ground  of  fraud  are  barred 
in  five  years  after  the  fraud  is  discovered. 
Code,  §§  2.529(-l).  2.5;J0.  The  law  does  not  con- 
template actual  knowleilge  of  the  fiaud  b?- 
fore  the  statute  shall  begin  to  run,  but  such 
knowledge  or  notice  as  would  lead  a  man 
of  reasonable  prudence  to  make  inquiries 
which  would  disclose  the  fraud.  Hawley  v. 
Page,  77  Iowa,  240,  42  N.  W.  193.  The  re- 
cording of  the  deed  imparts  constructive  no- 
tice of  its  contents  If  the  facts  thus  shown, 
takefl  with  other  facts  known  to  the  cred- 
itors, are  of  a  character  to  suggest  fraud  as 
to  them,  they  must  be  charged  with  the 
knowledge  which  inquiry  made  with  reas  n- 
able  diligence  would  disclose.  Laird  v.  Kil- 
bourne,  70  Iowa,  83.  30  N.  W.  9;  Hawley  v. 
Page,  supra;  Sims  v.  Gray  (Iowa)  Gl  N.  W. 
171.  In  this  case  the  Tama  county  land  was 
situated  in  the  county  in  which  the  action 
against  the  husband  was  pending,  and  was 
conveyed  tu  the  wife  three  daj's  after  the  ac- 
tion was  commenced,  and  w'.thin  three 
months  of  its  purchase  Dy  the  husband. 
They  had  but  little  propeii:y,  the  wife  having 
not  more  than  $300.  They  continued  to  re- 
side on  the  farm,  and  there  was  no  apparent 
reason  for  the  change  in  the  title  thereto,  un- 
less to  protect  it  from  the  plaintiff.  It  is 
not  shown  that  he  was  in  ary  manner  de- 
ceived m  regard  to  the  property  of  the  wife. 
Certainly  the  facts  recited  were  sufficient  to 
cause  a  man  of  ordinary  prudence,  situated 
as  the  plaintiff  was,  to  make  inquiries  which 
would  have  shown  the  fraud,  if  any,  in  the 
oouveyance.  Aid  this  is  true  with  re.>pect 
to  the  subsequent  acquiring  of  title  to  the 
Sac  county  land.  Both  these  transactions 
occurred  more  than  five  years  before  the  com- 
mencement of  this  action.  It  is  said,  how- 
ever, that  the  fraud  alleged  was  continuous, 
for  that  the  earnings  of  the  husband  wcra 
placed  in  the  name  of  th.?  wife  from  the 
time  the  conveyances  were  made  until  this 
action  was  commenced.  But  the  earnings  of 
the  husband  were  exempt  from  execution, 
and  it  was  his  right  to  give  them  to  his  wife 
free  from  tht  (.laims  of  his  creditors.  Jami- 
son V.  Weaver.  87  Iowa,  79.  .53  N.  W.  1076. 
We  do  not  hold  that  fraud  in  the  transaction 
in  question  has  been  shown.  There  is  much 
support  in  the  record  for  the  claim  that  Mrs. 
Stevens  agreed  to  pay  for  the  U'ama  county 
land  its  fair  value  at  that  time,  and  that  the 
property  she  now  owns  was  derived  in  part 
from  money  which  she  had  when  she  was 
married,  in  part  from  the  increase  of  the 
value  of  the  land  in  both  Tama  and  Sac  coun- 
ties after  it  was  purchased  by  her,  in  part 


258 

from  the  labor  of  her  husband,  and  in  part 
from  her  own  personal  exertions.  But  we  need 
not  determine  the  facts  in  regard  to  this. 
The  plaintiff  has  failed  to  use  the  diligence 


AVOIDANCE  OF  CONTRACT. 


in  prosecuting  his  claim  which  the  law  re- 
quires, and  it  is  now  barred  by  the  lapse  of 
time.  The  decree  of  t.b,e  diatiict  court  is  af- 
firm e<i. 


DELIVERY  AND  CONTINUED  POSSESSION. 


253 


Kirr  V.  LAMORF  W-X, 

(45  N.  W.  1002.  81  Mich.  299.) 

Supreme  Court  of  Michigan.    June  G,  1890. 

Error  to  circuit  court,  Kent  county; 
William  E.  (iuovic,  Judge. 

1U)\\.  St.  Midi.  §  (iliK),  provifles  that 
every  sale  by  a  vendor  of  goods  and  chat- 
tels in  liis  i)oss('ssion  or  under  his  control, 
unless  the  same  be  acccjnipanied  by  im- 
mediate delivei'y,and  to  be  followed  by  an 
actual  and  continued  changeof  possession 
of  the  things  sold,  sliall  be  presumed  to  be 
fraudulent  and  void,  as  against  creditors 
of  the  vendor,  and  shall  be  conclusive  evi- 
dence of  fraud,  unless  it  shall  be  made  to 
appear,  on  the  part  of  the  persons  claim- 
ing under  the  sale,  that  the  same  was 
made  in  good  faith,  and  without  any  in- 
tent to  defraud  such  creditors. 

Tiij^-fiHrt,  Wokott  &  (ianson,  for  appel- 
lant.    Frank  G.  Holmes,  for  appellee. 

CHAMPLIX.C.J.  Sarah  B.K'pp  brought 
replevin  against  Lamoreaux,  who  is  an 
under-sheriff  of  Kent  county,  to  recover 
possession  of  certain  horses  and  other 
proi)erty  which  he  had  levied  upon  as  the 
property  of  her  husband,  Harrison  T. 
Kipp.  The  plaintiff  claimed  that  she  had 
purchased  this  property  from  her  husband, 
who  was  engaged  in  the  livery  stable  busi- 
ness. Defendant  claimed  upon  the  trial 
that  the  sale  was  fraudulent,  and  made  to 
delay,  defeat,  and  defraud  the  creditors  of 
Harrison  T.  Kij)p.  The  defendant  claimed 
that  there  had  been  no  change  of  posses- 
sion, and  that,  therefore,  the  burden  of 
l)roof  was  upon  the  plaintiff  to  show  that 
the  sale  was  made  in  good  faith,  and  with- 
out any  intent  to  defraud  creditors.  The 
errors  relied  upon  in  this  court  relate  e.K- 
clnsively  to  the  charge  of  the  court.  This 
charge  is  couched  in  the  following  lan- 
guage: 

"Gentlemen  of  the  Jury:  This  is  an  ac- 
tion of  rei)leviii.  It  involves  the  ouestion 
of  who  is  entitled  to  the  possession  of  this 
property  at  the  time  of  the  commence- 
ment of  suit.  The  plaintiff  claims  that 
she  was  entitled  to  the  possession  as 
owner  of  the  property,  and  she  claims  to 
have  acquired  title  to  the  property  from 
Mr.  Kipp,  now  her  husband,  about  the  2d 
day  of  October,  1S88,  I  believe,  by  pur- 
chase from  him  in  payment  of  moneys 
which  she  claimsshe  had  loaned  him.  The 
defendant,  who  is  under-sheriff  of  this 
county,  claims  that  at  the  time  of  the  com- 
mencement of  this  suit  he  was  entitled  to 
the  i)ossession  of  the  property  by  virtue  of 
a  levy  which  he  had  made  upon  an 
execution  against  the  i)laintiff's  husband. 
The  question  of  fact  foi"  you  to  determine 
is  who  was  the  owner  of  this  jjropeity, — 
whether  Mr.  Kipj)  was  the  owner  at  the 
time  the  levy  was  made,  or  whether  the 
plaintiff  Mrs.  Kipp  was  the  owner.  As 
you  tind  the  fact  to  be  in  regard  to  the 
claim  of  the  purchase  by  the  plaintiff,  so 
will  your  verdict  be.  To  entitle  the  plain- 
tiff to  recover  in  this  suit,  she  must  satisfy 
you  by  a  fair  preponderance  of  the  evi- 
dence that  the  sale  to  her,  which  she 
claims  was  made,  was  in  fact  made  in  good 
faith,  and  for  full  value.    If  you  believe  her 


testimony,  and  that  of  Mr.  Kipp,  then 
there  was  at  different  times  loans  made  in 
different  amounts, aggregating  more  than 
$700,  which  were  mipaid  at  the  time  this 
bill  of  sale  was  made,  and  .$700  which  con- 
stituted theconsideration  forthis  purchase. 
Now,  it  is  a  genei-al  rule  that  where  there 
is  no  change  in  the  possession,  where  the 
pos.session  of  the  proi)erty  remains  with 
the  seller,  that  it  is  evidence  moi-e  or  less 
conclusive  of  fi-aud.  Jt  \h  prima  facie  evi- 
d  nee  of  fraud,  casting  the  burden  upon 
the  i)arty  claiming  under  the  sale  to  prove 
by  convincing  jjroof  that  the  sale  was 
made  in  good  faitii  and  for  value.  Our 
sui)reme  court  have  held  that  where  the 
relation  of  husband  and  wife  exists,  and 
they  ax'e  the  parties  to  the  alleged  si  !e,  this 
rule  cannot  be  applied  strictly,  altlunigh 
the  circumstance  is  one  to  be  considered  ; 
that  oi)en  or  visible  change  of  possession, 
under  such  circumstances,  cannot  be  ex- 
pected where  the  pai  ties  in  the  allej^ed  sale 
are  husband  and  wife,  and  living  together. 
Here  the  parties  were  not  married,  but  it 
is  claimed  on  the  part  of  the  plaintiff  that 
a  contract  of  marriage  existed  between 
them,  and  that  the  day  for  the  wedding 
was  i)ractically  fixed  to  occur  within  some 
thing  in  the  neighborhood  of  two  months 
following  the  sale;  and  that  in  the  mean 
time  she  was  to  go,  and  did  go,  to  the 
home  of  her  parents,  in  another  part  of 
the  state,  to  prepare  for  the  approaching 
marriage,  and  that  on  her  return  they 
were  married,  on  the  11th  day  of  Decem- 
ber. 

"Now,  under  all  of  those  circumstances, 
if  you  believe  those  to  be  the  facts  from  the 
evidence —  I  have  concluded  not  to  give 
you  the  general  rule  which  I  have  stated, 
as  applicable  to  the  facts  in  this  case,  if 
you  tind  those  to  be  the  facts,  but  to  say 
to  you  that  you  should  consider  those  cir- 
cumstances, of  the  relation  between  the 
parties,  their  marriage  engagement,  and 
all  of  the  facts  devel<Ji)ed  by  the  testimony 
in  connection  therewith,  and  also  the  facil- 
ity with  which  frauds  may  be  accom- 
plish, d  between  parties  bearing  such  rela- 
tions to  each  other,  undei-  i)reten.se  of 
sales;  and  that  you  should  carefully  weigh 
all  the  testimony  bearing  upon  the  ques- 
tion as  to  whether  there  was  a  sale  in  fact 
made;  and  that  the  proof  should  be  clear 
and  convincing,  more  so  than  if  the  par- 
ties were  strangers  to  each  other;  that 
alleged  sales  between  parties  occupying 
such  relations  should  beclosely  scrutinized 
in  weighing  the  testimony.  And  if  you 
tind  the  fact  to  be,  from  all  the  evidence, 
giving  it  the  weight  that  should  be  given 
to  it  under  these  instructions,  that  the 
sale  was  as  claimed,— that  is  the  conti-oll- 
ing  question  in  the  case, — if  you  find  that 
the  sale  was  made  in  consideration  of 
money  U)aned,  then  your  verdict  should 
be  for  the  [)laintiff;  otherwise  it  should 
not.  Now,  in  considering  the  facts  and 
circumstances  connected  with  this  alleged 
sale,  it  is  proper  to  take  into  considera- 
tion the  fact,  if  you  find  from  the  evidence 
that  it  is  a  fact,  that  Mr.  Kipp  believed 
that  the  debt  upon  which  this  execution 
issued  was  outlawed,  as  bearing  upon  the 
question  of  whether  he  would  have  an  in- 
tent  to  defraud.     Also   any  other  fact  de- 


:60 


DELIVKItV  AND  CONTINUED  POSSESSION. 


vi'lupt'd  by  the  tcstiinoiiy  that  niny  aid 
you  in  (letcriiiinins-  the  (]iiesti()n  whether 
or  not  tlie  sale  was  made  in  j^ood  faith. 
It  is  chiinied  that  Mr.  Kii)])  had  tiie  fraud- 
ulent intent,  in  disposing,-  of  this  projierty, 
to  Innder,  delay,  or  defraud  his  creditoi's. 
If  you  lind  that  to  he  the  fact,  it  woidd 
not  be  suHicient  of  itself  t(j  entitle  the  de- 
fendant to  a  verdict  in  this  case,  bec^ause 
it  would  be  necessai-y  for  you  to  still  fur- 
ther find  that  the  plaintiff  in  someway 
participated  in  that  fraud,  if  you  tind  the 
other  facts  that  I  have  told  you  necessary 
to  be  found,  that  she  purchased  the  pi-op- 
(M'ty  for  value.  Unless  she  participated  in 
the  fraud,  ami  made  the  i)nrchase  with 
the  intent  to  help  him,  if  he  had  himself  the 
intent,  it  would  not  be  such  a  fraud  as 
would  dei)rive  her  of  the  benefit  of  the  sale 
Avhich  she  claims  was  made  to  her,  if  she 
did  in  fact  purchase  the  i)roperty  for  full 
value.  Fraud  can  never  be  presumed  with- 
out proof.  It  is  not  to  be  li^'htly  inferred, 
but  must  be  ])roved  by  preponderance  of 
evidence  by  the  party  alleging  it.  Where 
an  honest  intent  can  be  as  clearly  Inferred  as 
a  dishonest  one,  the  jury  should  infer  that 
the  intent  was  honest,  because  the  pre- 
sumption is  in  favor  of  innocence,  tiaud 
cannot  be  i)i-esumed  from  slight  circum- 
stances. Proof  uf  fraud  should  be  such  as 
to  convince  your  n)inds  as  to  itse.xistence; 
and,  if  not  so  i)roved,  your  verdict  should 
be  for  the  plaintiff.  The  form  of  the  ver- 
dict, if  you  find  for  the  plaintiff,  will  be, 
'We  find  for  the  plaintiff,  and  assess  the 
damn<»es  at  six  cents.'  If  yon  find  for  the 
defendant,  then,  the  defendant  havin.i^' 
waived  a  return  of  the  property  rei)levie(l, 
your  verdict  should  be  foi'  the  amount  of 
the  value  of  the  property  as  shown  by  the 
evidence.  What  you  find  the  value  of  the 
proi)erty  to  be,  would  be  the  amount  that 
thedefendant  would  be  entitled  tor;.'COver, 
if  you  find  for  the  defendant. "' 

C(junsel  for  defendant  ctjutends  that  the 
<lefen<laiit  was  entitled  to  have  a  chai-ft'^ 
(•'>vering  the  g'eneral  rule,  where  creditors 
Contest  a  sale  of  personal  property  on  the 
j;round  of  fraud  as  to  them,  and  that  the 
<'.ourt  erred  in  refusing;  to  give  it,  and  in 
giving  a  modified  rule  as  to  parties  stand- 
ing in  the  relation  of  husband  and  wife. 
We  think  the  defendant  was  entitled  to  a 
charge  covering  his  thecjry  of  the  case, 
and  to  tne  general  rule  laid  down  in  the 
statute  respecting  sales  of  personal  prop- 
erty, where  the  same  is  not  accompanied 
by  an  immediatedelivery,  and  folhnved  by 
an  actual  ami  continued  change  of  i)osses- 
sion.  At  the  time  the  bill  of  sale  was  ex- 
ecuted the  plaintiff  and  Mr.  Kipp  were  not 
''husl)and  and  wife.  That  was  dated  Oc- 
tober 2,  Isss.  and  they  were  not  mari-ied 
until  in  Dee^-einber  following.  A  marriage 
engagement  existed,  and  after  the  bill  of 
sale  was  executed  she  went  to  .Milan  to 
prepare  for  her  wedding.  lie  continued  to 
carry  on  the  livery  business  in  the  city  of 
(Jrand  Rai>ids.  The  levy  was  not  made 
until  after  the  marriage.  The  (iuesti(jn  of 
change  of  possession  must  in  all  cases  be 
considered  in  connection  with  the  other 
facts  in  the  case.  The  relation  of  husband 
and  wife  foi-ms  no  exception  to   the  rule. 


The  situation  of  the  parties,  and  their  i-e- 
lation  to  each  other,  the  kin  1  of  pi-operty, 
itssu.soeptibility  of  an  actual  change,  must 
all  be  considered,  and  that  must  be  done 
which  will  indicate  an  a-tual  and  con- 
tinned  cha.nge  of  possession  ;  and  where 
this  is  not  the  case  the  iyurden  of  proof  is 
uixm  the  ])urchaser  to  show  that  the  sale 
was  made  in  good  faith,  and  without  any 
intent  to  deframl  creditors.  From  this 
burden  the  wife  or  husband  wIkj  is  a  pur- 
chaser from  the  other  is  not  exempt.  It  is 
a  ujistake  to  sui)pose  that  the  case  of 
Davis  v.  Zimmerman,  40  Mich.  24,  counte- 
nances a  different  doctrine.  That  case  holds 
that  the  wife  must  establish  her  i-ight  to 
the  property  (in  that  case  an  executed 
gift)  by  a  fair  preponderance  of  evidence. 
This  right  includes  the  hona  fides  of  the 
transaction,  and  the  non-existence  of  the 
intent  to  defraud  creditor-,  when  therehas 
been  no  actual  and  continiu'd  change  of 
possession.  The  court,  in  modifying  the 
general  rule  upon  this  branch  of  the  case, 
told  the  jury  that  the  controlling rjuestion 
was,  if  the  jui'y  should  find  that  the  sale 
was  made  in  consideration  of  money 
loaned,  then  their  verdict  should  be  for 
the  plaintiff;  otherwise  it  should  not. 
This  omitted  the  important  element  con- 
tained in  the  statute  relative  to  intent. 
Under  this  section  of  the  statute  it  is  not 
enough  that  the  purchase  .was  ma<le  in 
good  faith, — that  is,  for  a  vahmble  consid- 
eration, with  intent  to  pass  the  title  abso- 
lutely;  but  it  is  conclusive  evidence  of 
fraud,  miless  the  purchasershall  also  make 
it  ai)pear  that  the  sale  was  made  without 
any  inteni  to  defraud  creditors.  Under 
this  statute,  a  fraudulent  intent  on  the 
part  of  the  seller,  although  not  i)artici- 
pated  in  by  the  buyer,  will  avoid  the  sale 
as  to  creditors.  In  this  respect  it  differs 
from  sales  attacked  as  fraudulent  as  to 
creditors,  wliei-e  there  has  been  an  actual 
and  c(jntinued  change  of  ijosse.ssion.  The 
assignment  of  error,  based  upoii  the  con- 
cluding portion  of  the  charge  re.-pecting 
the  i)urden  of  proof,  we  tlnnk  is  not  well 
fouiided.  The  defendant  claimed  that  the 
sale  was  fraudulent,  because  it  was  with- 
out consideration,  and  made  with  intent 
to  defraud  Mr.  Kipp's  creditors.  This 
was  in  addition  to  the  claim  that  there 
had  been  no  change  of  ])ossession.  It  was 
to  this  claim  of  fraud  that  this  pcjrtion  of 
the  charge  refers,  and  it  is  correct  as  ap- 
plied to  that  branch  of  the  defense.  The 
ciicuit  jxidge  should  have  submitted  the 
(luestion  to  the  jury  whether  there  had 
been  an  immediate  delivery,  and.  if  so, 
whether  there  had  been  an  actual  and 
continued  change  of  possession,  unless  it 
was  conceded  tliat  there  had  not  been; 
and  that,  if  the  jury  find  that  there  had 
not  been  an  actual  and  continued  change 
of  pi^ssession,  then  they  should  find 
whether  the  sale  was  made  in  good  faith, 
and  without  any  intent  to  defraud  the 
creditors  of  Harrison  T.  Kipp.  The  judg- 
ment must  be  reversed,  and  a  new  trial 
ordered. 

LONd,  .1.,    did    not  sit.     The  other  jus- 
tices concurred. 


DELIVERY  AM)  ('((.XTIXIEI)    IM  tSSESSIOX. 


2GI 


-MAUKELLAR  v.   TILLSIK  ItY  et  :il. 
(BOOTH.  IntorvoiuH). 

SAME  V.  BOOTH. 

(.j1  N.  W.  222,  48  Minn.  :i!!(;.) 

Siiproinc    Court  of   Minnesota.      Fuli.   10,    1S'.)'J. 

.\l)l)cals  from  district  court,  lltMUU'iiiii  coun- 
ty:   I'oiid,  .Iu(l;ii'. 

Action  l»y  Tlionias  .Maclvcilar  :ij,'ainst 
Cliarles  A.  I'illsbiiry  and  others.  S.  A.  Hootli 
intervened.  .Jud.i;nient  for  plaintiff.  Tlie  in- 
tervener appeals.     Atllrnietl. 

Ripley.  Brennan  iV:  llooth.  for  api»ellant. 
Emery.  Hall  t\:  J-'letc  her,  for  respontlent. 

MITCH EIJ..  .1.  In  these  cases  the  appel- 
lant. Booth,  as  a.ssi.ynee  of  C.  E.  Cottrell, 
as.sails  the  validity  of  the  sale  of  certain  per- 
sonal property  by  his  assignor  to  the  plain- 
tiff Mackellar  on  two  jrrounris,  to  wit:  First, 
that  it  was  void  ntider  the  insolvent  law  of 
18S1.  because  made  in  contemplation  of  in- 
solvency with  a  view  of  sivinir  a  preference 
to  one  creditor  over  others;  and.  sec(  nd.  tiiat 
it  was  void,  ou  common-law  principles,  lie- 
cause  made  with  intent  to  hinder,  delay,  and 
defraud  creditors.  A  mere  preference  by  a 
debtor  of  one  creditor  to  another  is  not 
fraudulent  or  void  at  connnon  law.  though  the 
jirefereuce  may  have  the  iuciilental  effect  of 
hindering  the  latter  from  the  collection  of  his 
debt.  Such  preferences  are  not  imlawfiil 
except  as  forbidden  by  the  insolvent  law  of 
1.S81.  and  they  are  voidable  only  in  favor  of 
])roceedin.ss  under  and  in  aid  of  that  act. 
Outside  of  such  proceedings  preferences  are 
not  per  se  objectionable.  Vose  v.  Sticlcney,  VJ 
Minn.  otiT  (Gil.  ol2);  Smith  v.  Deidrick.  ;JU 
Miuu.  (iO,  14  X.  \\'.  2()2;  Berry  v.  O'Connor, 
[iS  Minn.  2'J.  21  X.  W.  S40.  It  therefore  be- 
comes impoitant  to  ascertain  the  status  of 
appellant,  and  Ihe  character  of  the  assign- 
ment under  which  he  claims,  in  order  to  tle- 
terniine  whether  he  is  in  position  to  make 
this  attack  ou  the  sale  in  question,  it  is  coii- 
ceded  that  the  assignment  from  Cottrell  to 
appellant  was  not  exectited  under  the  insol- 
vent law  of  ISSl,  but  was  merely  a  common- 
law  assignment  for  the  benelit  of  creditors,  as 
regulated  by  chaiJter  44,  Eaws  lS7(i.  But  it 
appears  that  after  the  assignment  was  ex- 
ecuti  tl.  and  the  assignee  had  accepted  the 
trust,  the  assignor  and  assignee  made  an  ex 
parte  application  to  the  court,  alleging  that 
the  intention  was  to  execute  an  assignment 
imder  the  insolvent  law  of  ISSl,  but  that  a 
mistake  was  made  through  the  use  of  a 
wrong  l)lank  in  drafting  the  instrument,  and 
that  upon  this  ex  parte  application  the  court 
assumed  to  make  a  decree  amending  and  re- 
forming the  assignment  so  as  to  conform  to 
the  intentions  of  the  assignor  and  assignee  by 
inserting  therein  the  necessary  jirovisions  to 
leake  it  an  assignment  mider  the  insolvent 
law  of  1S81.  We  had  suppos(>d  that,  if  any- 
thing was  settled  in  the  law.  it  was  that  an 
assignment  for  the  lienitit  of  creditors,  when 


executed  by  Iho  assignor  and  accepted  by 
the  assignee,  creates  a  valid  trust,  which  can- 
not be  changed  or  revoked  by  the  assignor,  or 
by  the  .joint  act  of  both  assignor  and  as- 
signee; and  what  the  assignor  and  assignee 
lannot  do.  certainly  the  court  cannot  do  for 
them.  Inileed,  the  appellant  admits  this; 
but  his  contention  is  that  it  is  only  the  ben- 
eliciaries  under  the  assignn;ent— the  creil- 
itor.s— who  can  object,  and  that  the  plaintiff 
is  not  in  position  to  raise  the  (luestion.  or 
assail  collaterally  the  action  of  the  court. 
We  cannot  assent  to  this  proposition.  The 
issue  lure  is  one  of  title  to  the  ])roperty,  and 
the  question  is,  what  is  the  nature  and  ex- 
tent of  the  assignees  title,  and  what,  if  any, 
objections  is  he  in  pi.sition  to  make  to  i)Iain- 
tifl's  claim  of  title?  The  assignee's  title,  if 
any,  rests  exclusively  upon  the  deed  of  as- 
signment. The  action  of  the  court  in  assum- 
ing to  change  the  luiture  of  ;'.  vested  trust 
Mas  an  absolute  nullity,  and  this  the  plain- 
till  had  a  right  to  assert  as  against  an  at- 
tempt of  the  assignee  to  set  up  the  void  de- 
cree for  the  purpose  of  assailing  his  title. 
The  appellant,  therefore,  v.as  not  in  posi- 
tion to  attack  the  sale  .-is  being  an  unlaw- 
ful preference  under  the  ins  ilvent  law  of 
1S81,  and  that  (luestion  is  wholly  out  of  the 
case. 

2.  It  was  open,  however,  for  Ihe  as.signee 
to  avoid  the  sale  as  frauilulent  on  any 
grounds  upon  which  creditors  of  the  assignor 
might  avoid  it.  Oeu.  St.  1878,  c.  41,  §  27  ((ien. 
St.  1S!)4.  S  42:j3).  The  principal  ground  upon 
Vhicli  it  is  claimed  that  the  sale  was  fraud- 
ulent and  void  as  against  creditors  is  that  it 
was  not  accompanied  by  an  immediate  deliv- 
ery, or  followed  by  an  actual  and  contiinied 
change  of  possession.  Gen.  .^t.  1878.  c.  41.  § 
l.">  (<;en.  St.  181)4.  §  421<J».  Assuming  that 
this  was  so.  yet  the  effect  of  it  woulil  be 
mertly  to  raise  the  presumption  that  the  .sale 
was  fraudulent.  11  would  still  be  competent 
for  the  veiulee  to  overcome  this  presumption 
liy  proof  of  facts  showing  that  the  sale  was  in 
fact  made  in  good  faith,  and  withotit  any  in- 
tent to  hinder,  delay,  and  defraud  the  ven- 
dor's creditors:  and  under  the  statute  the 
(luestions  of  good  or  bad  faith  and  fraud- 
ulent intent  are  (piestions  of  fact  for  the  jury 
cr  trial  court.  Gen.  St.  1878,  c.  41,  5  20  ((Jen. 
St.  1804,  §  ^224);  Vese  v,  Stickney,  10  Minn. 
8()7  ((Jil.  ;n2(;  Molm  v.  Barton.  27  Minn. 
530,  8  -N.  W.  7(J.">.  The  court  has  expressly 
found  that  the  sale  was  made  in  good  faith, 
and  without  any  intent  on  the  part  of  said 
Cottre:i  or  plaintiff'  to  hinder,  delay,  or  de- 
fraud creditors.  I'pon  an  examination  of  the 
entire  record  we  are  clearly  of  opinion  that, 
even  assuming  that  there  was  not  an  actual 
and  continued  change  of  possession  of  the 
property,  the  question  whether  i)laiutiff'  had 
satisfactorily  rebutted  the  presumption  of 
fraud  arising  from  that  fact  was,  tipon  the 
evidence,  (me  of  fact  for  the  trial  court,  and 
that  his  linding  cannot  be  disturbed.  In 
dis;i;tsi!!g  this  branch  of  the  case,  counsel  for 


262 


DELIVERY  AND  CONTINUED  POSSESSION. 


the  assignee  lay  much  stress  upon  the  evi- 
dence tending  to  show  that  the  sale  was  in- 
tended to  secure  a  preference  over  other 
creditors  to  the  Twenty-Third  Ward  Bank  of 
New  York,  of  which  plaintiff  was  president. 
The  evidence  to  that  effect  was  quite  per- 
suasive. But.  as  already  suggested,  that 
IKtint  was  not  in  the  case,  and  the  evidence 
referred  to  had  no  legitimate  tendency  to 
prove  the  second  point,  viz.,  that  the  sale  was 
made  with  intent  to  hinder,  delay,  or  de- 
fraud creditors.  There  is  a  point  in  the  sec- 
ond, or  "Pillshury,"  case  which  is  not  in  the 
first.  Some  two  or  three  weeks  after  tbe 
sale  already  considered,  it  was  found  that 
an  error  had  l)een  made  in  computing  the 
quantity  of  property  sold.  Cottrell  liad  then 
on  hand  in  his  warehouse  between  13,0UU  and 
ir),0()0  Brazilian  barrels,  and,  to  make  good 
the  shortage  referred  to,  he  executed  to 
plaintiff  a  bill  of  sale  of  12.384  of  tliese  bar- 
rels, bur  no  specific  barrels  out  of  the  entire 
lot  were  ever  set  apart  or  designated  as 
those  covered  by  this  supplemental  bill  of 
sale.  Cottrell  sold  all  the  barrels  indiscrim- 
inately to  the  Pillsbnrys  in  the  usual  course 
of  business  in  his  own  name.  When  Cot- 
trell made  the  assignment  to  appellant  there 
was  still  due  from  the  Pillsburys  somewhat 
more  than  enough  to  pay  for  the  12,384  bar- 
rels covered  by  the  bill  of  sale.  Plaintiff 
brought  suit  against  the  Pillsburys  to  recov- 
er the  amount  which  he  claimed  he  was  en- 
titled to.  Thereupon  the  appellant  interven- 
ed, claiming  tliat  he,  as  assignee,  was  en- 
titled to  the  money.  The  point  is  made 
that,  as  no  specific  barrels  were  ever  set 
apart  out  of  the  whole  lot  and  appropriated 
to  this  bill  of  sale,  therefore  the  title  to 
none  of  the  barrels  ever  passed  from  Cottrell 
to  plaintiff.  We  imderstand  the  fact  to  be 
that  all  the  barrels  were  of  exactly  .the  same 


kind  and  value.  The  evidence  was  sufficient 
to  warrant  tlie  conclusion  that  the  intention 
of  the  parties  was  that  the  title  to  the  bar- 
rels should  presently  pass  by  the  bill  of 
sale,  and  that  thereafter  plaintiff  should  be 
the  owner  of  12,384  barrels  out  of  the  whole 
lot,  and  that  they  sliould  be  under  the  ex- 
clusive control  of  Kern,  plaintiff's  agent,  who 
had  the  riglit  and  power  at  any  time  to  malie 
the  separation,  and  take  that  number  of  bar- 
rels out  of  the  lot.  While  there  is  some  con- 
fusion and  conflict  among  the  authorities  on 
the  subject,  yet  it  is  settled  in  this  state  tliat 
where  a  certain  number  of  articles  are  sold 
out  of  a  greater  number  of  exactly  the  same 
kind  and  quality,  with  the  intention  that  the 
title  should  presently  pass,  and  where  the 
vendee  has  the  absolute  right  at  any  time  to 
take  the  amount  or  number  out  of  the  whole 
mass  or  quantity,  this  is  sufficient  to  pass  the 
title,  although  the  specific  articles  are  not  ac- 
tually designated  or  separated  from  the  re- 
mainder. Under  such  circumstances,  until 
the  separation  is  made  the  vendor  and  vendee 
are  tenants  in  common  of  the  whole  accord- 
ing to  their  respective  interests.  Nash  v. 
Brewster,  39  Minn.  r)30,  41  N.  W.  105;  Benj. 
Sales,  c.  4,  and  American  note.  The  evi- 
dence was  sufficient  to  justify  the  finding  that 
plaintiff"  was  the  owner  of  these  barrels.  If, 
under  the  particular  facts  of  this  case,  there 
was  any  objection  to  plaintift''s  suing  the 
Pillsburys  alone  for  the  amount  to  which  he 
was  entitled,  it  was  obviated  by  the  inter- 
vention of  the  appellant  as  assignee,  for 
thereafter  all  the  parties  interested  in  the 
whole  sum  due  from  the  Pillsburys  were  be- 
fore the  court,  which  could  award  to  each 
the  amount  to  which  he  was  entitled.  Order 
affirmed. 

DICKINSON,  .7.,  absent,  took  no  part. 


DELIVERY  AND  CONTINUED  POSSESSION. 


263 


HOPKINS    V.    BISHOP. 
(51  N.  W.  902,  91  Mich.  328.) 
Supreme    Court    of    Micliigau.    April    8,    1892. 
Error  to  circuit  court,  Kent  couut}-;    Allen 
€.  Adsit,  Jucljj:e. 

Keplevin  by  Thomas  J.  Hopkins  against 
Loomis  K.  Bishop.  Judgment  for  plaintiff. 
Defendant  brings  error.     Reversed. 

C.  O.  Smedley,  for  appellant.  D.  C.  Lyle 
and  Stuart  &  Knappen,  for  appellee. 

MORSE,  C.  J.  The  defendant,  as  sheriff  of 
Kent  county,  represents  in  this  litigation  at- 
taching creditors  of  Clinton  H.  Hopkins,  a 
.son  of  the  plaintiff.  The  plaintiff  brought 
replevin  for  the  goods  attached,  and  recov- 
ered judgment  in  the  Kent  county  circuit 
court.  It  was  shown  by  the  plaintiff  on  the 
trial  that  his  son,  who  was  in  the  mercantile 
business  at  Cedar  Springs,  was  unable  to 
meet  his  obligations;  and  that  plaintiff"  was 
signer  of  two  notes,  with  his  son,  to  one  Mc- 
Bryer,  for  the  means  with  which  to  engage 
in  business.  These  notes  were  for  .$1,000  and 
.$800,  and  there  was  due  upon  them,  Decem- 
ber 15,  1890,  $1,898.  On  that  day  plaintiff 
took  up  the.se  notes  and  gave  his  individual 
note  in  their  stead,  and  his  son  gave  him  a 
bill  of  sale  of  the  stock  and  fixtures  in  his 
store,  estimated  to  be  worth  .$1,.jOO.  The 
book-accounts,  amounting  to  about  $700,  and 
what  cash  there  was  on  hand,  were  retained 
by  the  son.  Plaintiff"  then  went  to  the  store 
with  his  son,  who  delivered  the  key  to  him, 
ivnd  Informed  the  clerk  that  plaintiff  was 
thereafter  to  be  proprietor.  Plaintiff  then 
hired  the  clerk  and  his  son  to  run  the  busi- 
ness for  him.  Two  days  tnereafter  the  at- 
taclunent  levies  were  made.  December  23, 
1890,  plaintiff'  replevied  without  making  any 
demand  for  the  goods.  It  is  contended  that 
a  demand  should  have  been  made,  as  the 
goods  were  found  in  the  possession  of  the 
son,  Clinton  H.  Hopkins,  against  whom  the 
writs  of  attachment  ran.  Authorities  are 
cited  to  the  effect  that,  where  property  seized 
on  attachment  or  execution  is  found  by  the 
officer  in  the  actual  custody  of  the  person 
named  in  the  writ,  the  possession  under  the 
levy  is  lawful,  and  a  demand  is  necessary  be- 
fore I'epievin  can  be  brought.  In  this  state. 
a  demand  before  suit  is  not  requisite  if,  at 
the  time  of  the  levy,  the  goods  seized  are  the 
property  of  the  person  suing  in  replevin. 
The  fact  that  such  goods  are  in  the  lawful 
possession  of  the  person  named  in  the  writ 
of  attachment  or  execution  does  not  affect 
the  right  of  the  owner  as  against  one  taking 
possession  of  tliem  in  hostility  to  him.  The 
question  of  demand  before  suit  by  the  owner 
to  regain  possession  of  his  property  depends 
upon  whether  the  taking  was  lawful  as 
against  him.  If  the  plaintiff  in  this  case 
had  a  right  to  recover  this  property  from  the 
sheriff,  no  demand  was  necessary.  The 
sheriff  may  have,  in  good  faith,  levied  upon 
these  goods,  believing  them  to  be  the  prop- 


erty of  Clinton  H.  Hopkins;  but,  as  the  right 
of  plaintiff  to  regain  possession  of  them  does 
not  at  all  depend  upon  the  good  faith  of  the 
officer  in  taking  them,  there  is  no  good  rea- 
son, as  shown  in  Trudo  v.  Anderson,  10  Mich. 
oo7.  for  a  demand  before  suit.  The  taking, 
if  the  plaintiff  was  owner,  was  a  trespass, 
and  would  itself  have  constituted  a  conver- 
sion in  trover  without  proof  of  a  demand  and 
refusal. 

There  are  several  assignments  of  error  to 
the  refusal  of  the  circuit  judge  to  give  de- 
fendant's requests  to  charge.  These  re- 
quests are  not  set  out  in  the  bill  of  excep- 
tions, nor  in  the  printed  record,  except  as 
they  apx)ear  in'  the  assignments  of  error. 
These  assignments  form  no  part  of  the  bill 
of  exceptions,  and  we  cannot  presume  against 
the  validity  of  a  jutlgment  that  a  request  to 
charge,  not  found  in  the  bill  of  exceptions, 
was  presented  to  the  circuit  judge,  from  the 
mere  fact  that  such  request  is  set  out  in  the 
assignments  of  error.  The  assignments, 
therefore,  as  to  the  requests  not  given  by  the 
court,  will  not  be  considered.  Lindner  v. 
Hine,  84  Mich.  512,  48  N.  W.  43. 

It  is  assigned  as  error  that  the  circuit  judge 
modified  the  tenth  request  of  defendant, 
which  was  as  follows:  '"The  sale  must  be 
accompanied  by  an  actual  and  continued 
change  of  possession  as  Avell  as  a  nominal 
and  constructive  change,  or  the  transaction 
will  be  deemed  fraudulent  as  against  cred- 
itors; and  a  constriictiou  which  would  allow 
the  vendor  or  assignor  of  a  stock  of  goods 
to  continue  in  possession  thereof,  and  to  sell 
them  out  as  the  agent  of  the  piirchaser  or  as- 
signee, woidd  render  the  statutory  provision 
for  the  prevention  and  detection  of  frauds  a 
mere  nullity,"— by  adding  to  the  same:  "That 
is,  if  you  shoidd  find  that  Clinton  H.  Hopkins 
was  left  there  in  charge  of  the  goods  as  a 
mere  figure-head,  and  there  was  not  an  hon- 
est and  open  transfer."  It  is  claimed  that 
this  request,  as  presented,  was  good  law. 
and  applicable  to  the  case  under  the  ruling 
of  this  court  in  Doyle  v.  Stevens,  4  INIich.  93; 
citing  with  approval  the  language  of  the 
court  in  Butler  v.  Stoddard.  7  Paige.  IGG. 
But  it  was  held  in  Doyle  v.  Stevens  that,  if 
there  was  any  evidence  tending  to  show  an 
open,  outward  change  of  possession  and  a 
continuation  of  it,  it  woifid  be  a  (luestion  of 
fact  for  a  jury.  In  this  case  the  transac- 
tion between  the  plaintiff"  and  his  son  was 
not  concealed  from  any  one.  The  day  the 
alleged  sale  took  place  the  fact  was  made 
known  to  McBryer.  who  Avas  a  creditor  to 
the  extent  of  over  $1.8(iO.  and  the  clerk  in  the 
store  Avas  made  acquainted  with  the  change. 
All  the  possession  that  could  have  been  tak- 
en was  taken,  except  the  putting  out  of  the 
son  as  an  employe,  and  the  going  in  of  the 
plaintiff'  to  manage  the  store  personally.  The 
plaintiff"  was  not  a  merchant,  and,  unless  he 
was  precluded,  as  a  matter  of  law,  from 
hiring  the  son  to  manage  the  business  for 
him,  the  question  whether  or  not  there  was 


2G4 


l>ELlVElfV  AND  CONTINUED  POSSESSION 


such  a  clijui.^e  of  possession  as  satisliod  the 
statute  was  one  for  the  jury  to  determine. 
We  do  not  think  tlie  defendant  was  entitled 
to  the  re<iu(st  as  worded,  as  it  left  out  an 
important  element,  to-wit,  that,  even  where 
tliere  is  not  such  a  change  of  possession  as 
will  remove  the  presumption  that  the  sale  is 
fraudulent,  it  is  still  open  to  the  purchaser 
to  sliow  tliat  the  sale  was  made  in  good  faith, 
and  witliout  any  intent  to  defraud  creditors. 
But  it  is  further  contended  that  this  modifi- 
c.'ition  of  the  reipiest  placed  the  burden  of 
l)roof  upon  the  defendant  to  show  that  the 
transfer  was  fraudulent  as  against  creditors, 
when  the  fact  appearing,  as  it  did,  that  the 
son  was  left  in  the  full  management  of  the 
business,  negatived  the  idea  of  an  actual  ancl 
continued  change  of  possession,  and  there- 
fore put  the  burden,  under  the  sratute,  (How. 
Ann.  St.  §  G190,)  upon  the  plaintiff.  And  in 
this  connection  complaint  is  made  of  the 
charge  of  the  court,  as  follows:  "And,  in- 
deed, in  order  to  constitute  a  valid  delivery 
and  change  of  possession,  it  is  not  necessaiy 
tliat  the  buyer  himself  should  actually  have 
ever  been  present  at  the  store  or  Vv^here  the 
property  is,  but,  if  you  believe  that  an  actual 
sale  was  made  to  the  plaintiff,  he  could  au- 
thorize his  son  or  any  other  person  to  take 
possession  for  him  and  hold  possession." 
And  it  is  also  averred  that  the  court,  m  say- 
ing, as  he  did,  once  or  more,  in  the  charge, 
that  the  burden  of  proof  is  upon  the  defend- 
ant to  show  fraud  in  this  case,  also  tended  to 
lead  the  jury  to  believe  that  it  was  for  the 
defendant,  under  the  circumstances  of  the 
case,  to  prove  that  the  transfer  was  a  rraudu- 
lent  one.  A  careful  examination  or  the 
charge  of  the  court  shoAvs  that  the  burden  of 
proof  was  put  upon  the  defendant  to  rihow 
that  this  sale  was  fraudulent  as  against 
creditors,  witliout  anv  reference  to  wnat  the 


jury  might  find  as  a  fad  its  to  an  actual  and 
continued  change  of  po.ssessiou  or  lue  gut)a^. 
This  was  error.  There  is  no  doubt  but  what 
there  v/as  in  law  a  sufficient  immediate  de- 
livery; and  if,  upon  the  delivery  of  the  key 
to  plaintiff,  he  had  gone  into  the  store,  and 
assumed  the  management  of  it.  the  mere- fact 
of  liis  hiring  his  son  to  help  him  in  tne  busi- 
ness or  the  management  of  it  would  not  have 
militated  against  his  "actual  and  continued 
possession'"  under  the  statute;  but  there  was 
testimony  tending  to  show  that  the  key  was 
returned  to  the  son  a  few  days  arterwards, 
and  that,  as  far  as  ;niy  outward  evidence 
was  concerned,  the  son  was  running  the  busi- 
ness after  the  sale  the  same  as  before.  The 
jury  should  have  been  instructed  that,  if  they 
found  that  the  possession  of  these  goods  was 
not  actually  and  continually  in  the  plaintiff 
from  the  delivery  up  to  the  time  of  the  levy, 
tlien  it  was  for  him  to  show  that  the  sale  was 
an  lionest  one.  It  would  not  be  necessary 
tliat  the  plaintiff  himself  should  remain  at 
the  store  and  personally  manage  the  busi- 
ness. He  had  the  right  to  select  an  agent 
to  do  this  for  him.  But  he  could  not  select 
a  vendor  of  the  goods  as  such  agent,  unless 
something  was  done  to  give  the  public  to 
understand  that  the  possession  of  the  vendor 
was  the  possession  of  the  plaintiff;  that 
there  had  been  a  change  in  the  ownersnip  of 
the  goods.  This  change  must  be  an  -open, 
visible,  substantial"  one.  Clariv  v.  Lee,  7S 
ISIich.  231,  44  N.  W.  2G0. 

The  court  had  no  right  to  send  an  answer 
to  the  jury-room  to  a  question  propounded 
in  writing  to  him  by  the  juri)rs,  after  thej' 
had  retired  to  deliberate  upon  their  verdici. 
witiiout  the  consent  of  counsel  in  the  case. 
The  judgment  is  reversed,  and  a  new  trial 
granted,  with  costs  of  this  court  to  defend- 
ant.    The  other  justices  concurred. 


COXYEYAXCE  AND  ASSIGNMENT    FOR  BENEFIT  OF  CREDITORS. 


265 


WHITE  ot  al.  V.  COTZHAUSEN. 

(9  Sup.  Ct.  809.  129  U.  S.  329.) 

Snpronu'  Court  of  llic  United  Stutcs.     .Tan.  28, 
18S9. 

Apppiil  from  the  circuit  ciMirt  of  the  United 
States  for  the  Northern  district  of  Illinois. 

This  is  an  appeal  from  a  liecree  ileelaring 
two  conveyances  of  real  property  in  Illinois,  a 
bill  of  sale  of  numerous  pictures,  a  jud<?nieiit 
by  confession  in  one  of  the  coai-ts  of  that 
state  pursuant  to  a  warrant  of  attorney  given 
for  tliat  purpose,  and  certain  transfers  of 
property  accompanying  that  warrant,  to  be 
void  as  ajj;ainst  the  appellee,  Cotzliauscn,  a 
jiuigment  creditor  of  Alexander  White,  Jr. 
It  is  a-ssigned  for  ei-ror  that  the  decree  is  not 
supported  by  tlie  evidence.  Jiesitles  contro- 
verting this  position,  the  appellee  contends 
that  the  conveyaiices,  jud.nnent  l)y  confes- 
sion, and  transfers  were  illegal  and  void  un- 
der tiie  provisions  of  the  act  of  the  general 
assembly  of  Illinois  in  force  July  1,  1877, 
concerning  voluntary  assignments  for  the 
benelit  of  creditors.  1  Starr  &  C.  St.  1303. 
The  record  contains  a  large  amount  of  testi- 
mony, oral  and  written,  but  the  principal 
facts  are  as  follows:  Alexander  Wliite,  Sr., 
died  intestate  in  the  year  1872;  his  wife,  Ann 
White,  four  daughters.  Margaret,  Elsie,  Mary 
S.,  and  Annie,  and  two  sons,  Alexander  and 
James  B.,  surviving  him.  Each  of  the  chil- 
dren, except  James,  was  of  full  age  when  the 
father  died.  At  the  request  of  the  mother, 
and  with  the  assent  of  liis  sisters,  Alexander 
White,  Jr.,  qualihed  as  administrator,  and  in 
that  capacity  received  peisonal  assets  of  con- 
siderable value.  With  their  approval,  if  not 
by  their  express  direction,  he  undertook  the 
management  of  the  real  estate  of  which  his 
father  died  possessed :  making  improvements, 
collecting  rents,  paying  taxes,  and  causing 
repairs  to  be  made.  He  received  realty  in 
exchange  for  stock  in  a  manufacturing  com- 
l)any,  and  in  part  exchange  for  the  home- 
stead, taking  the  title  in  his  own  name. 
After  the  death  of  the  father,  the  widow  and 
children  remaineil  together  as  one  household, 
the  expenses  of  the  fan)ily,  and  of  each  mem- 
ber of  it,  being  met  with  money  furnished 
by  Alexander  White,  Jr.,  out  of  funds  he  re- 
ceived from  time  to  time,  and  deposited  in 
bank  to  his  credit  as  administrator.  But  no 
regular  account  was  kept  showing  tl)e  amount 
paid  to  or  for  iuiiividual  m^udjers  of  the 
family.  In  1878  it  was  determined  by  the 
widow  and  children  to  have  an  assigjiment  of 
dower  and  a  partition  of  llie  real  property, 
and  proceedings  to  that  end  were  instituted 
in  the  ciicuit  court  of  Cook  county.  111.  Be- 
fore the  close  of  that  year,  or  in  the  spring  or 
siunmer  of  1879,  having  failed  to  obtain 
from  the  administrator  a  satisfactory  account 
of  the  condition  of  the  estate,  they  consulted 
an  attorney,  who,  upon  investigation,  ascer- 
tained ( using  here  the  words  of  the  appellants' 
counsel)  that  Alexander  "W.nte,  .jr.,  "had 
lost  tiie  entire  personal  estate,  and  had  noth- 
ing except  his  interest  as  an  heir  in  certain 


of  tlie  real  estate  with  which  to  make  good 
his  losses."  It  appeared,  as  is  further  stated, 
that  he  had  mortgaged  some  of  the  real  prop- 
erty the  title  to  which  had  been  taken  in  his 
name;  had  anticipated  rents  on  other  proper- 
ty; iiad  exchanged  lands  for  stock  in  a  lieat- 
ing  and  ventilating  company;  liad  allowed 
taxes  to  accumulate;  and  liad,  besides,  in- 
duced some  members  of  the  family  to  guar- 
anty his  notes  to  a  large  amount.  Upon 
these  disclosures  being  made,  the  projierty 
was  put  under  tiie  immeiliate  diarge  of  the 
younger  son,  and  the  attorney  with  whom 
the  mother  and  sisters  had  advised  was  di- 
rected to  collect  the  amount  due  from  Alex- 
ander White,  Jr.  Thereupon  a  friendly  ac- 
counting was  had,  which  resulted  in  a  report 
bv  iiim  to  tlie  i)robate  court,  on  the  18th  of 
July,  1879,  of  his  acts  and  doings  as  admin- 
istrator during  the  whole  period  from  the 
date  of  his  appointment.  April  9,  1872,  to 
July  21,  1879.  The  report  admits  a  balance 
due  from  iiim  as  a  Iministrator  of  .SS9,t34(i.0.5, 
and  charges  him,  "by  virtue  of  t!ie  statute," 
(Rev.  St.  111.  1874,  c.  3,  §  113,)  with  .$40,- 
123.80,  being  interest  on  tliat  sum  from  Jan- 
uary 21,  187.5,  to  July  21,  1879,  at  the  rate 
of  10  percent,  per  annum;  in  all,  the  sum  of 
.f  129,769.85.  He  does  not  seem  to  have  as- 
serted any  claim  whatever  for  his  services  as 
administrator,  or  for  managing  the  real  piop- 
erty.  That  report  was  api)roved  by  the  pro- 
bate court,  which  made  an  ortler,  July  22, 
1879,  directing  the  said  sum  of  8129,769.85 
to  be  distributed  and  paid  by  the  administra- 
tor as  follows:  To  the  widow,  .Sl:3,256.61, 
and  to  each  of  the  other  children.  .514,418.87. 
It  should  be  stated  in  tiiis  connection,  that 
on  the  16th  of  July,  1879.  two  days  before 
the  report  to  the  probate  court,  the  proceed- 
ings in  the  partition  suit  were  brought  to  a 
conclusion  by  a  decree  assigningtlower  to  tlie 
widow,  and  setiitig  off  spec, lie  parcels  of  land 
to  Margaret  and  Alexander,  respectively,  and 
other  parcels  to  the  remaining  heirs  jointly. 
On  the  same  day,  Alexander  While,  Jr.,  ex- 
ecuted two  conveyances, — one  to  his  sisters 
(except  Margaret)  and  his  brother  James, 
jointly,  for  part  of  the  lands  assigned  to  him 
by  the  decree  of  partition,  and  the  other  to 
his  s.ster  ^largaret  for  the  remaining  part; 
the  former  ilei  d  reciting  a  consideration  of 
656,859.20,  which  is  about  the  aggregate  of 
the  several  amounts  subsequently  directed  to 
be  paid  by  the  administrator  to  his  brother 
and  sisters,  (except  Margaret,)  while  the  lat- 
ter deeti  recited  a  consideration  of  .514,214.80, 
which  is  about  the  sum  directed  to  be  paid  to 
his  sister  Margaret.  Two  days  later,  July 
18,  1879,  Alexander  White,  Jr.,  executed  to 
liis  mother,  brother,  and  sisters  (except  Mar- 
garet) a  bill  of  sale  of  his  interest  in  certain 
pictures  wliich  had  come  to  his  hands  as  ad- 
ministrator; and  three  days  thereafter,  -luly 
21,  1879,  he  executed  to  his  mother  a  note, 
accompanied  by  a  warrant  of  attorney  to  con- 
fess judgment,  and  by  a  conveyance  and 
transfer  of  certain  real  and  personal  property 
as  collateral  security  for  the  note.  Subse- 
quently, September  4,  1879,  pursuant  to  that 


.266 


CONVEYANCE  AND  ASSIGNMENT  FOR  BENEFIT  OF  CREDITORS. 


warrant  of  attornev.  judgment  was  entered 
against  Alexander  Vviiite.  Jr.,  for  $43,807.50, 
in  the  circuit  court  of  Cooi<  county.  It  is  not 
claimed  that  any  money  was  pa:d  to  him  in 
these  transactions,  and  it  is  admitted  that  the 
sole  consideration  for  his  transfers  of  prop- 
erty to  the  members  of  his  family  was  his  al- 
leged indebtedness  to  them,  respectively. 

JJv  the  final  decree  in  tiiese  consolidated 
<.'auses,  it  was  adjudged  that  tiie  two  coiivey- 
iinces  of  July  16,  lb79,  the  bill  of  sale  of  July 
18,  1879,  and  the  judgment  l)y  confession  of 
September  -i,  1879,  and  the  transfers  accom- 
panying the  warrant  of  attorney  of  July  21, 
1879,  were  made  without  adequate  considera- 
tion, and  with  intent  to  hinder,  delay,  and 
defraud  the  appellee,  Cotzliausen,  who  was 
found  by  the  decree  to  be  a  creditt)r  of  Alex- 
ander White,  Jr.,  in  the  sum  of  827,842.22, 
the  aggregate  principal  and  interest  of  four 
several  judgments  obtained  by  him  against 
White,  in  1881  and  1882.  The  debts  for 
which  these  judgments  were  rendered  orig- 
inated in  the  early  part  of  1878,  in  a  pur- 
chase frimi  Cotzliausen  of  nearly  all  the  stock 
of  the  American  Oleograph  Company,  whose 
principal  place  of  business  was  ^Milwaukee, 
Wis.  In  this  purchase  Alexander  \Vhite, 
Jr.,  was  interested.  It  is  to  be  inferred  from 
the  evidence  that  the  principal  object  he  iiad 
in  making  it  was  to  transfer  the  office  of  the 
company  to  one  of  the  buildings  owned  by 
the  family  in  Chicago,  and  to  start  or  estab- 
lish his  younger  brother  in  business.  His 
mother  and  sisters  were  evidently  aware  of 
his  purchase,  and  approved  the  object  for 
whi(,-h  it  was  made.  It  may  be  here  stated 
that  Margaret  White  died  unmarried  and  in- 
testate before  the  decree  in  this  cause  was 
entered,  but  the  fact  of  her  death  was  not 
previously  entered  of  record.  The  parties  to 
the  present  appeal,  however,  have,  by  writ- 
ten stipulation  liled  in  this  cause,  waived  all 
objections  they  might  otherwise  iu;ike  by 
reason  of  that  fact.  It  is  further  stipulated 
that  the  appellants  are  the  only  heirs  at  law 
of  Margaret  White.  The  appellee  waives  all 
objections  to  the  present  appeal  on  the  ground 
that  Alexander  White,  Jr.,  did  not  join  in  it. 
Ira  \V.  liiiell  and  C.  31.  Usboiii,  for  ap- 
pellants. Ew'Ch  Tutten  and  F.  W.  Cutzliau- 
sen,  for  appellee. 

Mr.  Justice  HAKLAX,  after  stating  the 
facts  in  the  foregoing  language,  delivered 
the  opinion  of  the  court. 

Too  much  stress  is  laiil  by  the  appellee  upon 
the  fact  that  Alexander  White,  Jr.,  after  quali- 
fying as  administrator,  was  authorized  by  his 
mother  and  sisters  to  control,  in  histliscretion, 
both  the  real  and  personal  estate  of  which  his 
father  died  possessed.  The  granting  of  such 
authority  cannot  be  held  to  have  created  any 
lien  in  favor  of  his  creditors  upon  their  re- 
si>ect:ve  interests.  Nor  can  it  be  said  that 
they  surrendered  their  right  to  demand  from 
him  an  accounting  in  respect  to  his  manage- 
ment of  tlie  property.  Upon  such  account- 
ing he  might  b'come  indebted  to  them;  and, 
to  the  extent  that  he  was  justly  so  indebted, 


tliey  would  be  his  creditors,  with  the  same 
riglit  that  other  unsecured  creditors  had  to 
obtain  satisfaction  of  their  claims.  The 
mode  adopted  by  them  to  that  end,  with  full 
knowledge  as  well  of  his  linancial  condition 
as  of  the  fact  that  he  was  being  pressed  by 
Cotzliausen,  was  to  take  property  on  account 
of  tlieir  respective  claims.  After  he  had 
executetl  the  conveyances,  bill  of  sale,  war- 
rant of  attorney,  and  transfers,  to  which 
reference  has  been  made,  he  was  left  with- 
out anything  that  could  be  readied  by  Cotz- 
liausen. So  completely  was  he  stripped  by 
these  transactions  of  all  prop^-rty  that  subse- 
quently, when  liis  deposition  was  taken,  he 
admitted  that  he  owned  notliing  except  the 
clothing  he  wore.  He  recognized  his  lio[)e- 
lessly  insolvent  condition,  and  formed  the 
purpose  of  yielding  to  creditors  the  dominion 
of  his  entire  estate;  and  it  is  too  plain  to  ad- 
mit of  dispute  that  in  executing  to  his  motii- 
er,  sisters,  and  brother  th:'  conveyances,  bill 
of  sale,  warrant  of  attorney,  and  transfeis  in 
question  his  intention  was  to  give  them,  and 
their  intention  was  to  obtain,  a  preference 
over  all  other  creditors.  What  was  done 
was  in  execution  of  a  scheme  for  the  appro- 
priation of  his  entire  estate  by  his  family,  to 
the  exclusion  of  other  cred  tors,  thereby 
avoiding  the  effect  of  a  formal  assignment. 
The  first  question,  therefore,  to  be  consid- 
ered is  whether  the  several  writings  executed 
by  Alexander  White,  Jr.,  for  tiie  purpose  of 
effecting  that  ivsiilt,  may  be  regarded  as,  in 
legal  effect,  one  instrument,  design •  d  to  evade 
or  defeat  the  provisions  of  the  statute  of  Illi- 
nois known  as  the  "Voluntary  Assignment 
Act,"  in  force  .July  1,  1877. 

The  first  section  of  tliat  statute  provides 
"that,  in  all  cases  of  voluntary  assignments 
hereafter  made  for  the  benelit  of  creditor  or 
creditors,  the  debtor  or  debtors  shall  annex 
to  such  assignment  an  inventory,  under  oalh 
or  affirmation,  of  his,  her,  or  tiieir  estate, 
real  and  personal,  according  to  the  best  of 
his,  her,  or  their  knowledge;  and  also  a  list 
of  his,  her,  or  their  creditors,  their  residence 
and  place  of  business,  if  known,  and  the 
amount  of  tiieir  respective  demands;  but 
such  inventory  shall  not  be  conclusive  as  to 
the  amount  of  the  debtor's  estate,  but  such 
assignment  shall  vest  in  the  assignee  or  as- 
signees the  title  to  any  other  projierty,  not 
exempt  by  law,  belonging  to  the  debtor  or 
debtors  at  the  time  of  making  the  assign- 
ment, and  comprehended  within  the  general 
terms  of  the  same.  Every  assignment  shall 
be  duly  acknowledged  and  recorded  in  the 
county  where  the  person  or  persons  making 
the  same  reside,  or  where  ihe  business  in  re- 
spect of  which  the  same  is  made  has  been 
carried  on;  and  in  case  said  assignment  shall 
embrace  lands,  or  any  interest  Iherein,  then 
the  same  shall  also  be  recorded  in  the  county 
or  counties  in  which  said  land  may  be  situ- 
ated." Other  sections  provide  for  publica- 
tion of  notices  to  creditors;  for  the  execution 
by  the  ass.gnee  of  a  bond  and  the  tiling  of 
an  inventory  in  the  county  court;  for  the  re- 
port of  a  list  of  all  creditors  of  the  assignor; 


CONVEYANCE  AND  ASSIGNMENT   FOR  BENEFIT  OF  CREDITORS. 


:67 


and  for  exception  by  any  person  interested 
to  the  claim  or  demand  of  anyotlier  creditor. 
'IMie  sixth  section  provides  "that  at  tiie  lirst 
term  of  the  said  county  court,  after  the  ex- 
piration of  tlie  three  n)ontiis,  as  aforesaid, 
should  no  exception  be  made  to  the  claim  of 
any  creditor,  or  if  exceptions  have  l)een  ma  le. 
and  tlie  same  have  been  adjudicated  and 
settl  'd  by  the  CO  I  rt,  the  said  court  sliall  order 
the  assignee  or  assignees  to  make,  from  time 
to  time,  fair  and  equal  dividends  (among  the 
creditors)  of  the  assets  in  his  or  their  hands, 
in.  proportion  to  their  claims,"  etc.  Tlie 
eighth  section  declar;s  that  "no  assignment 
shall  be  declared  fraudulent  or  void  for  \v;int 
of  any  list  or  inventory  as  provided  in  tiie 
first  section."  The  thirteenth  section  is  in 
thi'se  words:  "Every  provision  in  any  as- 
signment hereafter  made  in  this  state  pro- 
viding for  the  payment  of  one  debt  or  liabil- 
ity in  preference  to  another  shall  be  voiil, 
an  I  i',11  debts  and  liabilities  within  the  pro- 
visions of  the  assignment  shall  be  paid  p/'o 
Tata  from  the  assets  thereof." 

The  main  object  of  this  legislation  is  mani- 
fest. It  is  to  secure  equality  of  right  among 
the  creditors  of  a  debtor  who  makes  a  volun- 
tary assignment  of  his  property.  It  annuls 
every  provision  in  any  assignment  giving  a 
preference  of  one  creditor  over  another.  Xo 
creditor  is  to  be  excluded  from  participation 
in  the  proceeds  of  the  assigned  property  be- 
cause of  the  failure  of  the  debtor  to  make  and 
file  the  required  inventory  of  his  estate  and 
tlie  list  of  his  creditors;  nor,  it  such  a  list  is 
filed,  is  any  creditor  to  be  denied  iiis  ]jro  rata 
part  of  sucii  proceeds  because  his  name  is 
omitted,  either  by  design  or  mistake  u[)on  the 
part  of  the  debtor.  The  dittiiulty  with  tlie 
courts  has  not  been  in  recognizing  the  benef- 
icent objects  of  this  legislation,  but  in  de- 
termining whether,  in  view  of  the  special 
circumstances  attending  their  execution,  par- 
ticular instruments  are  to  be  treated  as  part 
of  an  assignment,  within  the  meaning  of  tiie 
statute.  The  leading  case  upon  this  subject 
in  the  supreme  court  of  Illinois  is  Preston  v. 
Spaulding,  120  111.  208,  10  N.  E.  Kep.  903. 
In  tiiatcase  the  members  of  an  insolvent  firm, 
in  anticipation  of  bankruptcy,  made,  within 
a  period  of  less  than  thirty  days,  lour  convey- 
ances of  tiieir  indiviilual  estate  to  near  rel- 
atives, and  various  payments  of  money  to  oth- 
er relatives,  on  alleged  debts;  after  these  con- 
veyances and  payments,  and  with  full  knowl- 
edge of  impending  failure,  the  members  ol  the 
lirm  held  a  conference  with  their  legal  ad- 
visers before  the  ex[)i ration  of  said  thirty  days, 
respecting  the  measures  to  be  adopted  by 
thein,  and  the  shape  their  failure  was  to  as- 
sume. It  was  determinetl  that  they  should 
m.ike  a  voluntary  assignment,  but  that  pref- 
erence be  given  to  certain  creditors  by  execut- 
ingtothein  whatare called  "judLjinent  notes." 
The  assignment  in  form  was  male,  but  on  the 
same  day,  and  before  it  was  executed,  the 
creditors  to  whom  tiie  notes  were  given 
caused  judgment  by  confession  to  be  entered 
th  -leon,  and  immediately,  and  before  the  deed 
of  assignment  was  or  could  be  tiled,  caused 


execution  to  be  issued  and  levied,  whereby 
they  took  to  thciii-ielves  the  great  bulk  of  the 
debtor's  estate.  The  trustee  named  in  the 
assignment  having  refused  to  attack  the 
inefeieuces  thus  secured,  a  creditor  brought 
suit  in  equity,  upon  the  theory  that  the  giv- 
ing of  the  judgment  notes  and  the  making  of 
the  deed  of  assignment  were  parts  of  one 
transaction,  and  consequently  the  j)reference3 
attempted  were  illegal  and  void  under  tin- stat- 
ute. The  supremecouit  of  Illinois,  consider- 
ingthequestion  whether  the  preferential  judg- 
ments obtained  in  that  case  were  within  the 
proliibitions  of  the  act  of  1877,  said:  "The 
statute  is  silent  as  to  the  form  of  the  instru- 
ment or  instruments  by  which  an  insolvent 
debtor  may  effect  an  assignment  *  *  * 
If,  then,  these  preferences  are  to  be  held  to  be 
witiiin  the  '  provisions  '  of  the  assignment  or 
♦  couiprehended  within  its  general  terms,'  it 
must  be  because  th.ey  fall  within  the  intent 
and  spirit  of  the  act.  It  will  be  observed 
this  act  does  not  assume  to  interfere,  in  the 
sli  .litest  degree,  with  ttie  action  of  a  debtor, 
while  he  retains  the  dominion  of  his  prop- 
erty. Notwithstanding  this  act,  he  may  now, 
as  lieretofore,  in  good  faith  sell  his  property, 
mortgage  or  pledge  it  to  secnie  a  bona  Jide 
debt,  or  create  a  lien  upon  it  by  operation  of 
law,  as  by  confessing  a  judgment  in  favor  of 
a  bona  fide  creditor.  But  when  lie  reaches 
the  point  where  he  is  ready,  and  determines, 
to  yield  the  dominion  of  his  property,  and 
makes  an  assignment  for  the  benefit  of  his 
creditors,  under  the  statute,  this  act  declares 
that  the  effect  of  such  assisrninent  shall  be  the 
surrender  and  conveyance  of  all  his  estate, 
not  exempt  by  law,  to  his  assignee, — render- 
ing void  all  preferences,  and  brmjiing  about 
the  distribution  of  his  whole  estate  equally 
among  his  buna  fide  creditors;  and  we  hold 
tliat  it  IS  within  the  spirit  and  intent  of  the 
statute  that  when  the  debtor  lias  formed  a 
determination  to  voluntarily  dispose  of  his 
whole  estate,  and  has  entered  upon  that  de- 
termination, it  is  iminateri;il  into  how  many 
parts  tlie  perlormance  or  execution  of  his 
determination  may  be  broken, — the  law  will 
regard  all  his  acts  having  for  their  object  and 
effect  the  disposition  of  his  estate  as  parts  of 
a  single  transaction,  and,  on  the  execution 
of  the  formal  assignm  nt,  it  will,  under  the 
statute,  draw  to  it,  and  the  law  will  regard 
as  embraced  witiiin  its  p'rovisions,  all  prior 
acts  of  the  debtor  having  for  ther  object 
and  purpose  the  voluntary  transferor  disposi- 
tion of  his  estate  to  or  for  creditors;  an  I,  if 
any  preferences  are  shown  to  have  been  made 
or  given  by  the  debtor  to  one  creditor  over 
another  in  such  disposition  of  his  estate,  full 
effect  will  be  given  the  assignment,  and  such 
preferen:-es  will,  in  a  court  of  equity,  be  de- 
clared void,  and  set  aside  as  in  fraud  of  the 
statute."  After  setting  out  the  details  of 
the  plan  devised  to  secure  certain  creditors 
a  pre.erence  in  advance  of  the  filing  of  the 
deed  of  assignment,  the  court  further  said: 
"It  will  be  observed  that  all  this  was  strictly 
in  accordiince  with  the  forms  of  law;  but  will 
anyone  deny  that  a  most  palpable  fraud  was 


268 


CONVEYANCE   AND  ASSIGNMENT      OK   RENEFIT  OF  CKEDITOIIS. 


in  fact  perpetrated  upon  llieaj)neilee,  .Spauld- 
ing,  by  the  debtois,  or  that  tlie  acts  of  the 
debtors  were  in  fraud  of  tliestatiiteV  *  *  * 
Tliis  voluntary  assij^nnient  act  is  in  its  cliai- 
acter  reni'dial,  and  niustthereforel)elil)eraliy 
construed,  and  no  insolvent  debtor  liaving 
in  view  the  disposition  of  his  estate  can  be 
permitted  to  defeat  its  operation  by  effeLt- 
ing  unequal  distribution  of  his  esta'.e  by 
means  of  an  assignm  nt,  and  any  other  shift 
or  artitice  nmler  the  forms  of  law;  and,  what- 
ever obstacles  iniijjht  be  encountered  in  other 
courts  of  tills  state,  a  court  of  equity,  when 
properly  invoked,  was  bouiul  to  look  tinough 
and  beyond  the  form,  and  have  regard  to  tlie 
substance,  and,  having  done  so,  to  lind  and 
declare  these  preferential  judgments  void  un- 
der the  statute,  and  to  set  them  asule."  8ee. 
also,  Hank's  Apneal,  57  Pa.  St.  19^.  h)\); 
Winner  v.  Ilovt,  G6  Wis.  227,  239.  28  N.  W, 
Rep.  380;  Wilks  v.  Walker,  22  S.  C.  108,  111, 
\\'e  agree  with  tlie  supreme  court  of  Illi- 
nois that  this  statute,  being  remedial  in  its 
character,  must  be  iiberaily  construed ;  that 
is,  construed  "largely  and  benelicially,  so  as 
to  suppress  the  mischief  and  advance  the 
remedy."  That  court  saiJ  in  liailroad  Co.  v. 
Dunn,  52  111.  2G0,  263:  "Tiie  rule  in  con- 
struing remedial  statutes,  though  it  may  be 
in  derogation  of  the  common  law,  is,  that  ev- 
erything is  to  be  done  in  advancement  of  the 
remedy  that  can  be  done  consistently  with 
any  fair  construction  that  can  be  i)ut  upon 
it."  See,  also,  Johnes  v.  Johnes,  3  Dow,  15. 
If,  then,  we  avoid  over-strict  construction, 
and  regard  substance  rather  than  form;  if 
effect  be  given  to  this  legislation,  as  against 
mere  devices  th.it  will  defeat  the  object  of 
its  enactment, — the  several  writings  executed 
by  Alexander  White,  .Jr.,  all  about  the  same 
time,  to  his  mother,  sisters,  and  brother, 
wiiereby,  in  contemplation  of  his  banki  upt- 
cy,  and  according  to  a  plan  previously 
formed,  he  surrendered  his  entire  estate  lor 
their  benefit,  to  the  exclusion  of  all  other 
creditors,  must  be  deemed  a  single  instru- 
ment, expressing  the  pur()oses  of  the  [larties 
in  consummating  one  transaction,  and  oper- 
ating as  an  assignment  or  transfer  under 
which  the  appellee,  Cotzhausen,  may  claim 
equally  of  right  with  the  creditors  so  pre- 
ferred. It  is  true  there  was  not  here,  as  in 
Preston  v.  Spiulding,  a  formal  deed  of  as- 
signment by  the  3ebtor  under  the  statute. 
IJut  of  what  avail  will  the  statute  be  in  se- 
curing equality  among  the  creditors  of  a 
debtor  who,  b6ing  insolvent,  has  determined 
to  yield  the  dominion  of  his  entire  estate,  and 
surrender  it  for  the  benelit  of  creditors,  if 
some  of  them  can  be  preferred  by  the  simple 
device  of  not  making  a  formal  assignment, 
and  permitting  them,  under  the  cover  or  by 
means  of  conveyances,  bills  of  sale,  or  writ- 
ten transfers,  to  take  his  whole  estate  on  ac- 
count of  their  respective  debts,  to  the  exclu- 
sion of  other  creditors?  If  Alexander  White, 
Jr.,  intending  to  surrender  all  liis  property 
for  the  benelit  of  his  creditors,  and  to  stop 
business,  had  excepted  from  the  conveyances, 
bill   of   sale,  and   Iraiisleis  executed  to  his 


mother,  sisters,  and  brother  a  relatively  small 
amount  of  property,  and  had  shortly  there- 
after made  a  general  assignment  under  the 
statute,  it  could  not  be  doubted,  under  the 
decision  in  Preston  v.  Spaulding,  and  in  view 
of  the  facts  here  disclosed,  that  such  convey- 
ances, bill  of  sale,  and  transfers  would  have 
been  held  void  as  giving  forbidden  prefer- 
ences to  particular  creditors;  and  his  assii^n- 
meiit  would  have  been  heid,  at  the  suit  of 
other  creditors,  to  embrace,  not  simjily  the 
property  owned  by  him  when  it  was  made, 
but  all  that  he  previously  conveyed,  soM,{Mid 
transferred  to  his  mother,  sisters. and  biother. 
But  can  he,  having  the  intention  to  quit  bus- 
iness and  surrender  his  entire  estate  to  cred- 
itors, be  permitted  to  defeat  any  such  result 
by  simply  omitting  to  make  a  formal  assign- 
ment, and  by  including  the  whole  of  his 
property  in  conveyances,  bills  of  stile,  and 
transfers  to  the  particular  creditors  whom  he 
desires  to  prefer  y  Shall  a  failing  debtor  be 
allowed  to  employ  indirect  means  to  accom- 
plish that  which  the  law  prohibits  to  be  done 
directly?  These  questions  must  be  answered 
in  the  neirative.  They  could  not  beanswered 
otlierwise  without  siigiresting  an  easy  mode 
by  which  the  entire  oljject  of  this  legislation 
may  be  defeated. 

We  would  not  be  understood  as  contraven- 
ing the  general  principle,  so  distinctly  an- 
nounced by  the  tiiprerae  court  of  Illinois, 
that  a  debtor,  even  when  linancially  embar- 
lassed,  may  in  good  faith  compromise  his 
liabilities,  sell  or  transfer  property  in  pay- 
ment of  debts,  or  mortgage  or  pledge  it  as 
security  for  debts,  or  create  a  lien  upon  it  by 
means  even  of  a  judgment  confessed  in  favor 
of  ills  creditor.  Preston  v.  Spauliling;  Field 
V.  Gtohegan,  125  III.  70,  16  N.  E.  Rep.  912. 
Such  transactions  often  take  place  in  the  or- 
dinary course  of  business,  when  the  debtor 
has  no  purpose,  in  the  near  future,  of  dis- 
continuing business,  or  of  going  into  bank- 
ruptcy and  surrendering  control  of  all  his 
property.  A  debtor  is  not  bound  to  succumb 
under  temporary  reverses  in  his  affairs,  and 
has  tiie  right,  acting  in  good  faith,  to  use  his 
{uofierty  in  any  mode  he  chooses,  in  order  to 
avoid  a  general  assignment  for  the  benelit  of 
his  creditors.  W'e  only  me;in  by  what  has  been 
said  that  when  an  insolvent  debtor  recognizes 
the  fact  that  he  can  no  longer  go  on  in  busi- 
ness, and  determines  to  yield  the  dominion  of 
his  entire  estate,  and  in  execution  of  that  pur- 
pose, or  with  an  intent  to  evade  the  statute, 
transfers  all,  or  substantially  all,  his  proper- 
ty to  a  part  of  his  creditors,  in  order  to  pro- 
vide for  tlieni  in  preference  to  other  cred- 
itors, the  instrument  or  instruments  by  which 
such  transfers  are  made,  and  that  result  is 
jea'died,  whatever  their  form,  will  be  iield  to 
oji  rate  as  an  assignment,  the  benefits  of 
which  may  be  claimed  by  any  creditor  not  so 
preferred,  who  will  take  appropriate  steps  in 
a  court  of  equity  to  enforce  the  equality  con- 
templated by  tiie  statute.  Such,  we  think, 
is  the  necessary  result  of  the  decisions  in  the 
highest  court  of  the  state. 

Tiie  views  we   have  expressed   find  some 


CONVEYANCE  AND  ASSIGNMENT  FOR  BENEFIT  OF  CREDITORS. 


269 


support  in  adjudged  cases  in  tlie  Eighth  cir- 
cuit, wliere  the  courts  have  construed  tlie 
statute  of  Missouri  providing  that  "every 
assignment  of  hinds,  tenements,  goods,  chat- 
tels, el'tVcts,  and  creilils,  made  l)y  a  debtor  to 
any  pt-rson  in  trust  for  his  creditors,  shall  be 
for  the  benefit  of  all  the  creditors  of  the 
assignor  in  proportion  to  th' ir  respective 
claims."  lieferring  to  that  statute,  Kukkkl, 
J.,  said,  in  Keilog  v.  llichardson,  19  Fed. 
Rep.  70,  11,  following  tlie  previous  case  of 
Martin  v.  Hausman,  14  Fed.  Hep.  160:  "A 
niei  chant  may  eive  a  moitgage  or  a  deed  of 
trust  "1  oart  or  all  of  his  j)roperty,  to  set-ure 
one  or  m  >r»^  of  iiis  cre.iitors,  thus  preferring 
them,  but  he  cannot  convey  the  whole  of  his 
jir.'p^'rty  to  one  or  more  creditors  and  stv^p  do- 
ing bu-^iness.  Such  turning  over  and  virtual- 
ly declaiing  insolvency  brings  the  instrument 
or  act  by  which  it  is  done  within  the  assign- 
ment law  of  ^lissonri,  which  requirt'S  a  dis- 
tribution of  tlie  pro])eity  of  the  failing  debtor 
foi-  the  l)enelit  of  all  the  creditors  in  propor- 
tion to  tlieir  res[)eftive  claims.  Such  is  the 
declared  policy  of  the  law;  it  places  all  cred- 
itors upon  an  etjual  footing."  So  in  Kerbs 
v.  Ewing,  22  Fed.  Rep.  6"j;l,  where  Judge 
Ml  CuAUV,  referring  to  the  Missouri  statute, 
said:  "Xo  matter  what  the  form  of  the  in- 
strument, where  a  debtor,  being  insolvent, 
conveys  all  his  property  to  a  third  party,  to 
pay  one  or  more  creditors,  to  the  exclusion 
of  otlieis,  such  a  conveyance  will  be  con- 
strued to  b?  an  assignment  for  the  benefit  of 
all  the  ere  litors:  the  preference  being  in  C(jn- 
travention  of  the  assignment  laws  of  tliis 
state."  Again,  in  Freiind  v.  Yaetrerinan, 
26  Fed.  Rep.  812,  814,  it  was  said  by^TuEAX, 
J.,  that  the  conclusion  reached  by  Mr.  Jus- 
tice MiLLEK,  and  Judges  McCn.\it\',  Kke- 
KKi.,  and  himself,  was  "that,  under  the  stat- 
ute of  tiie  state  of  Missouri  concerning  vol- 
untary assignments,  when  propi-rty  w;is  dis- 
posed of  in  entirety  or  subslanti;dly — that  is, 
the  entire  property  of  the  debtor,  he  being 
insolvent — it  fell  within  the  provisions  of  the 
assignment  law.  The  very  purpose  of  the 
law  was  that  no  preference  should  be  given. 
Xo  matter  by  what  name  the  end  is  sought  to 
be  effected,  it  is  in  violation  of  that  statute. 
You  may  call  it  a  mort;^age,  or  you  may  make 
a  confession  of  judgment,  or  use  any  other 
contrivance,  by  wiiatever  name  known  if 
th"  purpose  is  to  dispose  of  an  insolvent 
debtor's  estate,  whereby  a  preference  is  to  be 
effected,  it  is  in  violation  of  the  statute." 
See,  also.  Perry  v.  Corby,  21  Fed.  Rep.  737; 
Clapp  V.  Dittman,  Id.  1.5;  Clapp  v.  Xord- 
meyer,  25  Fed.  Rep.  71. 

If  Alexander  W'i.ite,  Jr.,  had  made  a  form- 
al assignment  of  liis  entire  property-  in 
trust  for  the  benefit,  primarily  or  exclusively, 
of  his  mother,  sisters,  and  brother,  as  cred- 
itors, its  illegality  would  have  been  so  ap- 
parent that  other  creditors  would  have  been 
allowed  to  participate  in  the  proceeds  of  sale. 
13y  the  conveyances,  bill  of  sale,  confession 
of  judgment,  and  transfers,  all  made  about 
the  same  time,  and  pursuant  to  an   under- 


stan  ling  previ(jusly  reached,  he  has  effected 
precisely  the  same  result  as  would  have  been 
reached  by  a  formal  assignment  to  a  trustee 
for  the  exclusi\e  bt^nefit  of  his  mother, 
brother,  and  sisters.  The  latter  is  forbidden 
by  the  letter  (;f  tlie  statute,  and  tlie  former 
is  eijually  forbidden  by  its  spirit.  Surely, 
the  mere  name  of  the  particular  iiistrum''nts 
by  which  the  illegal  result  is  reached  ought 
not  to  be  peimitted  to  stand  in  the  way  of 
giving  the  relief  contemplated  by  the  st  itiite. 
Courts  of  equity  are  not  to  be  misled  by  mere 
devices,  nor  batHed  by  mere  forms. 

It  remains  only  to  consider  the  effect  of 
these  views  upon  tlie  decree  below.  We  liave 
already  seen  that  the  circuit  court  ju-ocecded 
upon  the  ground  that  the  conveyances,  bill 
of  sale,  confession  of  judgment,  and  trans- 
fers by  Alexander  White,  Jr.,  were  made 
without  adequate  consideration,  and  with  in- 
tent, to  hinder,  delay,  and  defraud  tlie  appel- 
lee. Upon  these  grounds  it  gave  him  a  prior 
right  in  the  distribution  of  the  property. 
We  are  not  able  to  assent  to  this  determina- 
tion of  tlie  rights  of  the  parties,  for  the 
nii'ther,  sisters,  and  brother  of  Alexand  r 
Whit>',  Jr.,  were  his  creditors,  and,  so  far  as 
the  record  disclo-ies,  they  only  sought  to  ob- 
tain a  preference  over  othr  creditors.  Rut 
their  attem[)t  to  obtain  such  illegal  prefer- 
ence ouiriit  not  to  have  the  effect  of  depriv- 
ing them  of  their  interest,  umler  the  stat- 
ute, in  the  proceeds  of  the  property  in  ques- 
tion, or  justify  a  decree  giving  a  prior  right 
to  the  appedee.  It  was  not  intended,  by  the 
statute,  to  give  priority  of  right  to  the  cred- 
itors who  are  not  preferred.  All  that  the  ap- 
pellee can  claim  is  to  participate  in  such  pro- 
ceeds upon  terms  of  equality  with  other  cred- 
itors. 

It  results  that  the  decree  below  is  erro- 
neous, so  far  as  it  directs  tlie  property,  riglds, 
and  interests  tlierein  describe  I  to  be  sold  in 
salisfaclion  primarily  of  the  sums  found  by 
the  decree  to  be  due  from  Alexander  \\'hite, 
Jr.,  to  the  appellee.  Tise  case  should  go  to 
a  master  to  ascertain  the  amount  of  all  the 
delits  owing  by  Alexander  White,  Jr.,  at  the 
date  of  said  conveyances,  bill  of  sale,  and 
transfers.  In  respect  to  the  amounts  due 
from  him  to  his  mother,  sisters,  and  brother, 
respectively,  it  is  not  necessary,  at  this  time, 
to  express  any  opinion,  further  than  that  the 
accounting  in  the  probate  court  between 
them  is  not  conclusive  against  the  appel- 
lee. It  will  be  for  the  court  below  to  deter- 
mine, under  all  evidence,  what  amounts  are 
justly  due  from  Alexander  White,  Jr.,  to  his 
mother,  sisters,  and  brother,  taking  into  con- 
sideration all  tiie  circumstances  attending 
his  management  of  the  property,  formerly 
owned  by  liis  father,  whether  real  or  personal. 
To  the  extent  we  liave  indicated  the  decree 
is  reversed,  each  side  paying  one-half  the 
costs  in  this  court;  and  the  cause  is  remanded, 
with  a  direction  for  further  proceed. n-s  not 
inconsistent  with  this  opinion. 

The  Chief  Justice  did  not  sit  in  this  case, 
or  participate  in  its  decision. 


27U 


CONVEYANCE  AND  ASSIGNMENT  FOR  BENEFIT  OF  CREDITORS. 


WARNER   V.    LITTLEFIELD,    Sheriff. 

(50  N.  W.  721,  89  Mich.  329.) 

Sii[U-c'nu>  Court  of  Michigan.     Dec.  22,  1891. 

Error  to  circuit  court,  Wayne  county;  Cor- 
nelius J.  lU'illy.  Judge. 

Action  in  trover  by  Cliarles  E.  Warner,  trustee 
under  a  cliattel  mortgage  for  the  benefit  of 
creditors  of  ^Minnie  Wertheimer,  against  Louis' 
B.  Littlofield,  for  the  conversion  of  goods  cov- 
ered by  tlie  mortgage,  by  attaching  the  same 
at  the  instance  of  a  creditor  of  said  Minnie 
Wertlieinier.  I'laintiff  had  judgment,  and  de- 
fendant brings  error.  Reversed,  and  new  trial 
gi-anted. 

Julian  G.  Dickinson,  for  appellant.  CJrittin, 
Warner  &  Hunt,  for  appellee. 

CHAMRLIN,  C.  J.  This  action  is  trover. 
The  defendant  was  sheriff  of  Wayne  conntj', 
and  pleaded  the  general  issue,  and  gave  notice 
that  he  seized  the  goods  declared  for,  as  sher- 
iff of  Wayne  countj-,  by  virtue  of  a  certain  writ 
of  attachment  issued  out  of  the  circuit  court 
of  Wayne  cminty  against  Minnie  Wertheimer, 
and  that  he  Avould  show  that  the  claim  to  the 
goods  set  up  by  plaintiff  was  fraudulent  and 
void  against  the  creditors  of  said  Minnie  Wert- 
heimer; that  the  mortgage,  so  called,  under 
which  the  plaintiff  claims.  Avas  made  with  in- 
tent to  cheat  and  defraud  her  creditors;  that  it 
comprised  substantially  all  of  her  propei'ty  sub- 
ject to  execution;  that  it  was  given  for  the 
purpose  of  distributing  her  property  to  certain 
of  her  creditors  in  preference  to  others,  and  was 
made  for  the  purpose  of  covering  and  conceal- 
ing her  property;  that  the  plaintitt"  in  said  cause 
was  not  a  bona  fide  purchaser,  and  is  charge- 
able with  notice  of  the  facts  and  circumstances 
constituting  the  fraud  perpetrated  by  the  said 
Minnie  Wertheimer  in  said  transac-tion;  that 
the  said  mortgage  tf  said  property  to  plaintiff 
did  net  comprise  a  large  poition  of  the  prop- 
erty of  said  Minnie  Wertheimer,  which  she  had 
concealed  and  covered  by  transfers  to  parties 
in  St.  Paul  and  Chicago,  and  to  the  Western 
Knitting  Company,  of  Detroit,  and  to  Max  Pu- 
laski, of  Detroit.  Avith  the  view  to  defeat  and 
defraud  her  creditors;  that  a  large  portion  of 
the  indebtedness  mentioned  in  said  mortgage, 
and  wliich  is  pretended  to  be  secured  thereby, 
is  fictitious  and  fraudulent  as  against  the  cred- 
itors of  the  said  IMinnie  Wertheimer.  notably 
indebtedness  therein  mentioned  to  ^Max  Wert- 
heimer. Morris  Wertl^eimer,  and  .Joseph  Wert- 
heimer. 

On  the  13th  of  December,  1889,  Minnie  Wert- 
heimer, who  was  the'-i  engaged  in  business  in 
the  city  of  Detroit  under  the  name  of  Weil- 
heimer  Bros.,  executed  a  chattel  mortgage,  in 
which  she  set  forth  that  she  was  justly  in- 
debted to  several  creditors,  naming  tliem.  and 
the  amoimts  owing  to  each,  and  to  secure  the 
i)ayment  of  such  claims,  and  of  indemnifying 
Pernard  Wurzlierger  and  Freund  Bros,  against 
liability  upon  certain  obligations,  mortgaged  cer- 
tain  pr.)p(  rty,    fully    described   in   sucli   chattel 


mortgage,  to  "Carlos  E.  Warner,  of  Detroit, 
Mich.,  in  trust  for  said  parties  severall.v."  upon 
certain  conditions,  as  follows:  "The  conditions 
to  these  presents  are  such  that  if  I,  the  said 
Minnie  ^^'ertheimer,  doing  business  as  afore- 
said, shall  pay,  or  cause  to  be  paid,  to  said 
Warner,  trustee,  the  claims  and  demands  afore- 
said, and  each  and  all  thereof,  within  ten  da.vs 
from  the  date  hereof,  with  interest  thereon 
from  the  maturity  of  said  several  claim-^  and 
demands,  and  shall  keep  and  save  harmless  the 
said  Wurzberger  and  the  said  Freund  Bros, 
from  liability  as  aforesaid,  then  this  obligation 
shall  be  void,  otherwise  to  remain  in  full  force; 
and  I,  the  said  Minnie  Wertheimer,  agree  to 
Y>i\y  the  same  accordingly,  and  keep  said  Wurz- 
berger and  said  Fremid  Bros,  free  and  harm- 
less from  liability  as  aforesaid.  But  if  default 
shall  be  made  in  the  payment  of  said  debts 
and  demands  or  any  thereof  and  the  interest 
thereon,  or  any  portion  thereof,  within  the  time 
or  manner  herein  provided;  or  if  I,  said  ilin- 
nie  Wertheimer,  shall  not  keep  and  save  harm- 
less the  said  Wurzberger  and  said  Freund  Bros., 
or  either  of  them,  from  liability  as  aforesaid; 
or  if  I  shall  sell,  assign,  or  dispose  of  said 
goods  and  chattels,  (excepting  those  expresslj' 
excepted  herein,)  or  shall  remove,  or  attempt 
to  remove,  the  whole  or  any  portion  thereof 
from  the  premises  aforesaid,  without  the  writ- 
ten consent  of  said  '^'arner,  trustee,  except  in 
the  usual  course  of  trade;  or  if  the  said  War- 
ner, trustee,  shall  deem  himself  or  said  del)ts, 
or  any  of  them,  insecure, — then,  in  each  such 
instance,  the  said  Warner,  trustee,  his  suc- 
cesscrs  or  assigns,  or  his  or  their  authorized 
agents,  are  hereby  expressly  authorized  to  en- 
ter the  said  several  premises,  or  any  place  or 
places  where  s-.iid  goods  and  chattels,  or  any 
portion  thereof,  may  be,  and  take  possession 
thereijf,  subject  to  said  exemption,  and  sell  the 
same,  or  so  much  thereof  as  shall  be  necessary 
to  pay  the  expenses  incurred  in  and  about  the 
taking  possession  of  said  goods  and  chattels, 
and  in  the  care  thereof,  and  in  and  about  the 
foreclosure  of  this  mortgage,  and  the  costs  and 
charges,  taxes  and  insurance,  and  services  here- 
inafter mentioned,  and  the  claims  and  demands 
hereinbefore  mentioned,  and  each  and  all  there- 
of, and  the  interest  thereon,  and  to  keep  and 
save  harmless  the  sai-i  Wurzberger  and  Freund 
Bros,  from  lial)ility  as  aforesaid,  at  public 
auction,  to  the  highest  bidder,  or  at  private 
sale,  in  bulk  or  parcels,  at  his  option,  (any- 
thing contained  in  this  mortgage  to  the  con- 
traiy  notwithstanding,!  after  giving  five  daj^s' 
notice  of  such  sale,  and  the  time  and  place  of 
such  sale,  by  posting  written  or  printed  notice 
thereof  in  three  pul)lic  places  in  the  city  of  De- 
troit and  Cheboygan  aforesaid.  The  said  War- 
ner, trustee,  is  hereby  authorized  to  insme  said 
goods  and  chattels  in  such  sum  as  he  may  deem 
proper  to  protect  his  interests  in  this  mort- 
gage, and  the  moneys  paid  therefor  may  be 
added  to  and  becoiiie  a  part  of  the  debts  here- 
in secured,  and  shall  be  payable  forthwith,  and 
draAv  interest  at  the  raie  of  seven  per  cent,  per 
annum.     The  said  Warner,  trustee,  is  also  an- 


CONVEYANCE  AND  ASSIGNMENT   FUR  BENEFIT  OF  CREDITORS. 


271 


thorized  to  pay  nil  taxes  that  are  assessed 
against  said  goods  and  chattels,  and  add  the 
same  to  the  debts  herein  secured,  and  to  be 
payable  forthwitli,  with  lilie  interest.  From 
the  moneys  realized  upon  this  mortgage  in  any 
manner  by  said  Warner,  trustee,  he  sliall  pay 
and  applj'  tlie  same  in  the  following  manner, 
to-wit:  First.  He  shall  pay  all  of  the  e.xpenses 
incurred  by  him  in  and  al)out  the  execution  of 
the  trust  herein  created.  Second.  lie  shall  pay 
said  taxes,  insurance,  and  the  expenses  incur- 
red in  and  about  the  foreclosure  of  this  mort- 
gage. Third.  He  shall  pay  himself  a  reason- 
able compensation  for  his  services  in  executing 
the  trusts  herein  created.  Fourth.  With  the 
residue  and  remainder  he  shall  fii-st  pay  in  full 
the  following  of  the  claims  and  demands  here- 
inbefore mentioned,  if  sufficient  there  shall  be; 
if  not,  to  prorate  the  same  among  them,  viz., 
the  said  claims  of  the  German  American  Bank, 
Wurzberger,  Freund  Bros..  C.  E.  Bresler, 
Schloss  Brcs.  &  Co.,  S.  S.  Simon  &  Co..  Jacob 
Brown  &  Co.,  L.  Krug,  Goldsmith  Bros.,  Mrs. 
A.  Linx,  Heniy  Tittlebaum.  IMax  Wertheimer, 
Albert  Fiusterwald,  the  Kalamazoo  Overall 
Company,  M.  Rosenberg  &  Co..  Isaac  Wert- 
heimer. and  Joseph  Wertheimer.  guardian,  and 
:Meier  &  Schul^necht.  and  Morris  Wertheimer. 
Fifth.  And,  after  the  payment  in  full  of  said 
claims,  he  shall  pay.  apply,  and  prorate  the 
residue  among  the  remainder  of  the  parties 
hereinbefore  first  mentioned  in  proportion  to  the 
amount  of  their  respective  claims;  the  suiT-lns, 
if  any,  to  be  returned  to  said  first  party."  This 
trust  was  accepted  in  writing  by  Warner  on  the 
same  day. 

Upon  the  trial  in  the  cu'cuit,  the  comt,  under 
the  testimony  introduced,  directed  a  verdict  for 
plaintiff,  and  left  it  for  the  juiy  to  determine 
the  value  of  the  goods  seized  by  the  defendant, 
and  the  defendant  Ijrings  eiTor. 

Considerable  testimony  was  introduced  upon 
the  trial  which  the  defendant's  attorney  claims 
had  a  tendency  to  prove  that  the  mortgage  was 
fi-audulent  in  fact  as  a  conveyance  made  with 
intent  to  delay  and  defraud  creditors.  He  also 
claims  that  it  was  fi'aud  in  law,  as  being  an 
assignment  at  common  law.  and  was  void  un- 
der the  statute  (1  How.  Ann.  St.  §  ST39),  Avhich 
enacts:  "All  assignments,  commonly  called 
'common-law  assignments,'  for  the  benefit  of 
creditors,  shall  be  void,  unless  the  same  shall 
be  without  preferences  as  between  such  credit- 
ors, and  shall  be  of  all  the  property  of  the  as- 
signor not  exempt  fi-om  execution." 

The  first  question  is  whether  the  instrument 
is  void,  as  contravenixig  the  statute  aliove  re- 
feiTed  to.  The  first  objection  to  the  instrament, 
upon  which  some  reliance  seems  to  be  placed. 
is  that  the  instrament  is  made  to  AA'anier,  who 
was  not  a  creditor,  in  titist  for  the  creditor's 
named;  but  this  does  not  tend  in  the  remotest 
degree  to  give  the  instrument  the  character  of 
a  common-law  assignment.  The  instrument 
must  be  read  as  a  whole,  and  the  intent  gath- 
ered from  its  entire  contents.  By  naming  him 
as  trustee,  the  conveyance  did  not  vest  in  him 
the  absolute  title  to  the  propei-ty,  and  place  it 


beyond  the  reach  of  creditors.  If  valid,  the 
mortgagor  and  subsequent  lieuholders  had  a 
right  of  redemptirn;  not  so,  if  it  was  a  com- 
mon-law assigmuinit.  This  question  ought  to- 
be  considered  as  settled  by  the  repeated  deci- 
sions of  tliis  court.  It  first  arose  in  Eagg  v. 
Jerome,  7  Mich.  14.j.  There,  as  here,  a  moi-t- 
gage  was  executed  to  Robert  P.  Toms  and 
George  Jerome,  to  act  as  tnistees  for  the  cred- 
itors named  in  the  mortgage.  It  was  daimetl 
on  the  ijart  of  the  unsecured  creditors  that  this 
conveyance  was  in  its  nature  and  trae  effect 
an  assignment  in  trast  by  an  insah'ent  debtor 
of  all  his  propertj-  for  the  benefit  of  his  cred- 
itors, and  sliould  be  governed  by  rales  applica- 
ble thereto:  (1)  That  it  was  a  conveyance  by 
an  insolvent  debtor,  conscious  of  his  utter  in- 
solvency; (2)  that  it  was  of  all  his  propertj^; 
(3)  it  was  in  trust  for  the  btniefit  of  creditors- 
other  than  the  trustees,  and  to  secm-e  the  pay- 
ment of  the  debts  of  such  other  creditors;  (4> 
it  involved  a  resulting  tiiist  to  the  giantor. 
Mr.  Justice  Manning,  in  delivering  the  opinion' 
of  the  court,  said:  "The  mortgage  is  an  ordi- 
nary chattel  mortgage  with  two  exceptions.  It 
is  given  to  the  defendants  in  eiTor  instead  of 
the  creditors  of  Bayless  who  are  mentioned, 
with  the  amount  Bayless  was  owing  each  one 
of  them,  in  tlie  recital:  and  it  contains  a  pro- 
vision that  the  defendants  in  error  shaU  not 
be  liable  for  anything  except  their  own  per- 
sonal fault  and  neglect.  These  were  matters 
proper  for  the  jury  to  take  into  consideration, 
with  the  other  evidence  in  the  case,  but  Ave  see 
nothing  in  them  rendering  the  mortgage  fraud- 
ulent." In  Adams  v.  Niemann,  46  Mich.  136, 
8  N.  W.  719,  the  mortgage  was  made  to  Nie- 
mann and  Emil  Jochen  jointly,  but  the  debts- 
intended  to  be  secured  were  not  joint,  but  sev- 
eral. Niemann  had  t«o  claims,  one  for  a  per- 
sonal debt  due  to  himself,  originally,  and  one 
covering  liabilities  which  he  had  undertaken  for 
Ernest  Jochen  to  other  creditors.  Emil  Jochen 
also  had  a  personal  cla^m.  and  it  was  insisted 
that  a  joint  mortgage  could  not  l)e  made  to 
cover  separate  debts.  Mr.  Justice  Campbell,  in 
delivering  the  opinion  of  the  court,  said:  '"We 
do  not  tliink  there  is  any  legal  objection  to  sucli 
a  mortgage.  We  have  ah-eady  held,  at  this 
tenn,  that  a  policy  of  insm'ance  may  be  taken 
jointly  to  seciu'e  properly  owned  in  severalty. 
Castner  v.  Insurance  Co.,  46  Mich.  15.  8  N. 
AV.  .554.  It  has  never  been  necessary  that 
the  mortgage  should  be  given  directly  to 
the  beneficiaries.  The  security  is  always 
made  in  trust  to  secure  obligations,  ami 
the  trust  and  the  beneficial  interest  need  not 
be  in  the  same  hands.  A  mortgage  to  a 
third  iierson  wouki  be  as  valid  as  a  mort 
gage  to  a  creditor.  The  choice  of  a  mort- 
gagee is  a  matter  of  convenience,  and  there 
can  be  no  wrong,  and  there  may  be  some 
advantage,  in  giving  to  all  of  the  secured 
creditors  a  control  over  the  security*  in  which  aU 
are  ratably  interested,  and  it  would  effectually 
prevent  any  dispmes  as  to  priority."  The  ques- 
tion came  before  the  court  again  in  Walker  v. 
White,  60  Mich.  427,  27  N.  W.  5.54.     In  thaft 


272 


CONVEYANCE  AND  ASSIGNMENT   FOK  BENEFIT   OF  CREDITORS. 


case  a  inortsajie  was  executed  by  a  ineinl>jr 
of  a  linn  in  the  firm  name,  to  Wallver,  as  trus- 
tee for  certain  creditors  tlierein  uamed.  includ- 
iu.i,'  also  tlie  claim  of  Henry  E.  Porter,  at  $900. 
It  was  claimed  in  this  case  that  tlie  mortgage 
really  amounted  to  an  assignmtnt  with  prefer- 
ences. Mr.  Justice  Morse,  in  delivering  the 
opiniun  of  the  court,  said:  "The  mortgage  was 
so  dra^^■n  as  to  s])ecify  tlie  amount  of  Indebted- 
ness to  each  creditor  specifically,  and  the  plain- 
tiff was  by  its  terms  made  trustee  for  the  col- 
lection and  payment  of  the  amount  owing  to 
each.  There  is  no  legal  objection  to  such  a 
mortgage,  (Adams  v.  Niemann,  4G  Mich.  137, 
8  N.  W.  719,)  and  we  think  each  mortgagee 
<.'0uld  enforce  his  own  claim  under  the  mort- 
gage, his  separate  debt  being  clearly  stated, 
(Ilerm.  Chat.  Mnrtg.  357;  Burnett  v.  Pratt,  22 
Pick.  .">.5G;  Gilsor^  v.  Gilson,  2  Allen,  11.5.)"  The 
validity  of  a  mo  tgage  securing  several  sep- 
arate creditors  in  one  instrument  was  again  af- 
firmed in  Lyon  v.  Ballentine,  G3  Mich.  99,  29 
N.  W.  837.  If  in  tliis  case  there  had  been 
succissive  mortgages  running  to  the  creditors, 
and  thereby  securing  a  preference  in  favor  of 
these  same  creditors,  no  one  would  contend 
that  all  together  ihey  would  constitute  a  gen- 
eral assignment.  The  effect  of  the  instrument 
in  this  case  is  no  different.  It  was  said  in 
Walker  v.  White  that  each  creditor  could  en- 
force the  mortgage  for  his  own  benefit,  to  tha 
same  extent  as  if  he  had  a  separate  mortgage. 

Two  features  are  relied  upon  as  taking 
this  instrument  out  of  the  category  of  chat- 
tel mortgages,  and  relegating  it  to  that  of 
oommon-law  assignments.  One  is  that 
Avliich  I  have  just  noticed,  the  mortgage  be- 
ing made  to  a  trustee;  and  tlie  other  that 
it  includes  all  the  pi'operty  of  the  debtor. 
Expressions  have  crept  into  some  decisions 
to  the  effect  that  if  the  property  is  con- 
veyed in  trust  the  instrument  is  thereby 
changed  from  a  chattel  inortgage  to  an  as- 
signment. But  such  is  not  the  law,  unless 
the  conveyance  is  absolute,  and  places  tlie 
title  of  the  property  in  the  trustee.  Every 
chattel  mortgage  contains  a  trust  to  a  cer- 
tain extent.  It  necessarily  creates  a  trust 
in  the  mortgagee  as  to  the  surplus,  but  this 
does  not  invalidate  the  mortgage.  Jones. 
Mortg.  §  3.53.  Even  an  assignment  by  a 
debtor  to  his  creditor  of  personal  property, 
upon  trust  to  sell  and  paj^  his  debt,  with 
reservation  to  himself  of  the  surplus,  if  any 
there  be,  is  held  to  be  in  effect  a  mortgage. 
Jones,  Mortg.  §  352,  and  cases  cited  in  note 
2.  If  the  mortgage  is  to  a  trustee  for  the 
benefit  of  creditors,  as  was  held  in  Adams 
V.  Niemann,  411  Mich.  137,  8  N.  W.  719,  it  is 
as  valid  as  if  made  to  the  mortgagee.  The 
question  in  such  cases  is  this:  Is  the  title 
of  the  property  conveyed  to  the  trustee  so 
that  it  is  beyond  the  reach  of  the  creditors 
of  the  mortgagor?  If  their  relation  to  the 
property  is  not  changed  by  the  interposition 
of  a  trustee  between  the  creditoi'S  and  the 
property  of  their  debtor,  so  that  they  can- 
not reach   the  surplus,   or  redeem   ivom   the 


mortgage,  and  become  subrogated  to  the 
riglits  of  the  mortgagee,  tlien  the  instru- 
ment is  valid  as  a  chattel  inortgage.  If  the 
position  of  the  unsecured  creditors  is  not 
changed;  if  their  legal  rights  are  tlie  same 
as  they  woukl  be  if  separate  mortgages 
were  executed  directly  to  the  creditors  se- 
cured,— it  would  be  nonsense  to  hold  that 
the  intervention  of  the  name  of  a  trustee, 
mei'ely  for  convenience,  and  representing 
the  rights  of  such  creditors  as  mortgagees, 
would  destroy  the  validity  of  a  mortgage, 
and  change  it  to  a  common-law  assignment. 
There  is  no  baleful  magic  in  the  words,  "in 
trust  for  the  benefit  of  creditors."  The  law 
looks  alone  to  the  legal  effect  of  the  instru- 
ment, and,  if  the  trustee  is  a  mere  agent 
to  carry  out  and  enforce  the  lien  of  the 
creditors  for  whom  the  security  is  given, 
then  the  instrument  is  a  chattel  mortgage, 
and  nothing  else. 

In  this  case,  what  is  the  trust  which  the 
trustee  is  to  enforce  for  the  benefit  of  cred- 
itors? It  is  simply  to  protect  and  enforce 
their  lien  upon  the  property.  He  can  do  so 
in  no  different  manner  than  they  could 
were  the  security  given  to  them  individuady 
and  separately.  He  has  no  greater  power 
than  they  would  have.  The  power  of  sale 
is  the  same,  and  the  contlitions  are  the 
same.  The  words,  "in  trust  for  said  parties 
severally,"  might  have  been  stricken  out 
without  detriment  to  the  validity  of  the  in- 
strument. Warner  would  then,  as  he  does 
now,  stand  merely  in  a  representative  ca- 
pacity. The  creditors  assented  to  his  so  act- 
ing for  them,  and  no  fraud  is  perpetrated 
upon  other  creditors,  and  they  have  the 
same  rights  and  remedies  as  they  would 
have  had  if  these  secured  creditors  had 
been  named  mortgagees  jointly,  or  had  sep- 
arate mortgages.  This  is  quite  different 
from  an  assignment.  There  the  title  of  the 
property  would  have  been  conveyed,  and  a 
trustee  would  have  stood  betweeen  the  u.u- 
secured  creditors  and  the  property  of  their 
delator. 

2.  The  instrument  in  this  case  does  not 
purport  to  convey  all  of  the  debtor's  prop- 
erty. As  a  matter  of  fact,  as  appears  from 
the  record  before  us,  it  did  not  cover  all 
her  property.  But.  if  it  had.  it  would  not 
have  had  the  effect  to  invalidate  the  securi- 
ty. A  debtor,  although  insolvent,  may  se- 
cure a  creditor  for  the  payment  of  a  pre- 
existing debt  by  a  mortgage  upon  all  his 
l)roperty.  although  he  may  have  numerous 
otlier  creditors  who  are  unsecured.  This 
doctrine  has  been  so  often  and  so  repeatedly 
held  by  this  court  that  the  citation  of  au- 
thorities in  support  of  it  would  be  idle. 
Some  of  them  are  referred  to  in  Sheldon  v. 
Maun.  85  Mich.  205,  48  N.  W.  573.  The 
mortgagor  is  not  prevented  from  placing  in 
the  mortgage  property  of  greater  value  than 
the  amount  of  the  debt.  If  every  mortgage 
was  to  be  declared  a  common-law  assign- 
ment,   and    therefore    void,    be<-ause    it    con- 


CONVEYANCE  AND  ASSIGNMENT  FOR  BENEFIT  OP  CREDITORS. 


273 


taiiu'd  all  of  the  debtor's  property  to  seciire 
some  creditor  or  creditors  over  others,  or 
because  the  value  of  the  property  exceeded 
the  amount  of  the  debts  secured,  I  veutnre 
to  say  that  there  is  not  a  mortgage  in  the 
state  of  ^Michigan  that  is  not  void.  If  the 
value  of  the  property  greatly  exceeds  the 
debt  secured,  that  fact  may  be  considered 
as  having  a  bearing  upon  the  validity  of  the 
mortgage,  as  having  been  given  with  intent 
to  defeat,  delay,  and  defraud  creditors;  but 
it  ^Yould  not  change  the  character  of  the 
instrument  to  a  common-law  assignment, 
and  be  therefore  void  in  law.  Neither  the 
fact  of  insolvency,  nor  the  knowledge  of  the 
debtor's  insolvency  on  the  part  of  the  mort- 
gagee, will  defeat  or  impair  a  mortgage  se- 
curity taken  for  an  honest  debt.  The  right 
of.  a  debtor  to  give  security,  and  the  right 
of  a  creditor  to  take  security,  for  a  bona 
fide  debt,  cannot  be  denied.  In  fact,  insol- 
vency, or  impaired  credit,  or  inability  to  pay, 
are  the  only  reasons  for  requiring  or  tak 
ing  security  for  a  pre-existing  indebtedness. 
and  the  creditor  is  not  required  to  assert  or 
prove  his  ignorance  of  the  financial  situa- 
tion of  the  debtor  at  the  time  he  takes  the 
security.  If  the  creditor  asserted  that  he 
supposed  that  his  debtor  was  solvent,  we 
know,  from  the  common  experience  of  man- 
kind, that  nine  out  of  ten  times  the  asser- 
tion would  be  a  falsehood,  and  the  law  does 
not  require  any  such  miserable  subterfuge 
to  justify  the  exercise  of  a  legal  right.  The 
difference  between  a  chattel  mortgage  and 
a  common-law  assignment  is  that  one  is  a 
conditional  transfer  of  property,  and  the 
other  is  an  absolute  transfer.  From  one 
the  debtor,  the  attaching  or  execution  cred- 
itor, or  a  subsequent  mortgagee  has  a  right 
to  redeem;  from  the  other  there  is  no  right 
of  redemption.  In  an  assignment  both  the 
title  and  possession  of  the  property  is  vest- 
ed in  the  assignee;  in  a  chattel  mortgage 
neither,  until  default  and  foreclosure,  under 
the  decision  of  Lucking  v.  Wesson,  25  Mich. 
-143,  whatever  may  have  been  the  effect  of 
such  a  conveyance  at  common  law. 

It  has  been  supposed  that  Kendall  v. 
Bishop,  76  Mich.  (i34,  43  N.  W.  04.j,  lends 
support  to  the  idea  that  a  chattel  mortgage 
is  an  assignment  if  its  effect  "is  to  put  the 
entire  assets,  legal  and  equitable,  into  the 
hands  of  a  trustee  for  sale  and  distribution." 
But  Mr.  Justice  Campbell  in  that  case  laid 
down  no  such  doctrine.  He  was  speaking 
of  an  instrument  which  transferred  the  le- 
gal title  absolutely  to  a  trustee  for  sale  and 
distribution.  The  effect  of  that  decision 
ought  not  to  be  open  to  misunderstanding, 
or  a  misconstruction,  if  attention  is  paid  to 
what  Mr.  Justice  Campbell  stated  the  trust 
contained  in  the  instrument  was.  He  did 
not  make  any  objection  upon  the  grouud 
that  the  instrument  was  made  to  Mr.  Ken- 
dall in  trust  instead  of  to  the  creditors  di- 
rectly. It  is  not  to  be  supposed  that  he  in- 
tended to  overrule  what  he  had  said  in  Ad- 

V.\X  ZILE  SEL.CAS.SALES  —18 


ams  V.  Niemann,  above  quoted,  upon  that 
branch  of  the  case.  The  trusts  which  he 
referred  to  were  contained  in  the  body  of 
the  instrument,  and  were  plainly  pointed 
out.  Thus  he  says:  "The  trustee  was  em- 
powered, if  he  should  think  it  for  the  inter- 
ests of  the  secured  creditors,  to  continue  the 
manufacturing  business  so  as  to  get  all  ma- 
terials on  hand  ready  for  market,  and  buy 
new  stock,  goods,  merchandise,  and  mate- 
rials, long  enough  to  dispose  of  the  proper- 
ty for  the  best  advantage,  and  from'  the 
proceeds  he  was,  first,  to  pay  the  expenses 
of  the  trust  and  sale  and  disposition  of  the 
property;  second,  to  pay  all  debts  to  em- 
ployes; third,  to  pay  the  other  secured  delirs 
in  full  or  pro  rata;  fourth,  to  pay  the  sur- 
plus moneys  to  the  company.  *  *  *  By 
this  document  the  trustee  is  expressly  em- 
powered to  continue  the  business  if  he 
chooses,  to  go  on  and  complete  the  manu- 
facture of  the  stock,  and  to  buy  further  ma- 
terial and  goods  to  help  on  the  profitable 
winding  up  of  the  business,  and  to  dis- 
pose of  everything  as  soon  as  reasonably 
practicable.  And  by  this  grant  of  powers 
it  is  evident  that  the  company,  having  put 
everything  in  his  hands,  could  not  possibly 
do  anything  to  pay  debts  or  redeem  the 
mortgage,  while  the  intermingling  of  new 
and  old  business  would  deprive  execution 
creditors  of  any  means  of  getting  a  sale 
of  the  residue  belonging  to  the  mortgagor, 
if  in  fact  there  should  be,  as  the  law  and 
the  instrument  both  assume  there  might  be,- 
one.  In  other  words,  Mr.  Kendall  not  only 
took  an  interest  by  way  of  security  for 
debts  which  by  law  any  execution  creditor 
would  have  a  right  to  redeem,  but  he  also 
took  title  to  the  surplus,  with  power  to 
manage  and' dispose;  and  a  trust  was  cre- 
ated for  the  company  which  would  not  be 
subject  to  execution  as  a  mere  equity  in  the 
proceeds,  and  not  an  ownership  in  the  prop- 
erty." It  was  for  the  reason  that  the  instru- 
ment contained  these  trust  powers,  which 
operated  as  a  transfer  of  the  property,  that 
Mr.  Justice  Campbell  held  the  instrument 
not  to  be  a  chattel  mortgage,  but  an  assign- 
ment in  effect.  He  noted  and  relied  upon 
the  distinction  which  I  have  stated  between 
a  chattel  mortga?re  and  a  common-law  as- 
signment, and  he  placed  no  reliance  what- 
ever upon  the  ground  that  the  mortgage 
was  made  to  Kendall  in  trust  for  the  bene- 
fit of  the  creditors,  instead  of  to  the  credit- 
ors themselves.  And.  having  held  that  it 
was  an  assignment,  he  says:  "An  assign- 
ment of  all  one's  assets  to  an  assignee  for 
the  benefit  of  creditors  is  within  all  the 
definitions  of  a  general  assignment.  It  is 
the  completeness  of  the  transfer  that  gives 
it  character."  He  dees  not  say  that  a  chat- 
tel mortgage  of  all  one's  assets  to  a  mort- 
gagee for  the  benefit  of  cei'tain  creditors 
comes  withm  all  the  definitions  of  a  general 
assignment.  Indeed,  he  has  said  to  the  con- 
trary more  than  once.     Rollins  v.  Van  Baa- 


271 


CONVEYANCE  AND  ASSIGNMENT  FOR  BENEFIT  OF  CKEDITorvS. 


len,  50  Mich.  (114.  23  N.  W.  332;  Root  v. 
Potter.   r.O   Mich,   noo,  -lOT.  2(5  N.   W.   082. 

In  the  Rollins  Case  the  point  wa.s  directly 
raised  by  a  bill  in  equity  charging  that  the 
giving  of  a  single  mortgage  to  secure  two 
creditors,  and  another  to  secure  another,  up- 
on all  of  the  debtor's  property,  which  was 
worth  considerably  less  than  the  securities, 
was  in  effect  an  assignment  of  such  proper- 
ty, and  was  void  under  the  statute  of  1879, 
above  quoted.  Upon  the  question  thus 
squarely  raised.  Justice  Campbell  said,  re- 
ferring to  the  statute:  "It  should  be  con- 
strued as  it  reads,  as  applying  only  to  what 
purport  to  be  common-law  assignments.  If 
proceedings  not  in  that  form  are  claimed  to 
be  fraudulent  as  to  creditors,  they  must  be 
reached  in  some  other  Avay.  and  shown  to 
be  against  some  other  policy.  The  law  does 
not  avoid  honest  transfers  or  securities 
which  are  not  general  assignments." 

Root  V.  Potter  was  also  a  proceeding  in 
equity  wheie  all  the  facts  came  before  this 
court.  In  that  case  securities  had  been  giv- 
en by  way  of  chattel  mortgages  which  were 
executed  on  the  12th  of  July.  1884.  and  hand- 
ed over  to  the  mortgagees  on  the  loth,  and 
tiled  on  the  10th.  late  in  the  evening,  and  on 
the  IGth  the  mortgagors  executed  a  common- 
law  assignment.  These  mortgages  were  at- 
tacked as  being  preferences,  and  also  that 
they  were  given  to  hinder,  delay,  and  de- 
fraud creditors.  Under  the  latter  claim. 
Judge  Campbell  said,  referring  to  the  statute 
against  frauds:  "Under  these  provisions  of 
law,  fraud  was  made  a  question  of  fact,  and 
any  creditor  who  obtained  in  good  faith  his 
security  for  an  honest  debt  can  hold  it 
against  any  subsequent  claim  to  attack  it." 
He  then  said:  "The  question  then  arises 
whether  the  transactions  were  illegal,  as 
amounting  to  unauthorized  preferences  under 
the  assignment  law;  and  it  is  a  question 
which  is  supiiosed  to  be  an  entirely  new  one 
in  this  state.  It  is,  however,  upon  such 
facts  as  appear  to  exist  in  the  record  before 
us.  within  well-settled  and  familiar  princi- 
ples. There  is  nothing  in  the  assignment  law 
Avhich  undertakes  to  avoid  dealings  previous 
to  the  assignment,  whether  near  or  remote 
in  point  of  time,  which  Avere  in  no  wa.v  con- 
nected with  it  in  the  intention  of  the  par- 
ties. Retroactive  operation  which  Avould  di- 
vest lawfully  vested  rights  is  not  in  har- 
mony with  our  laws.  The  statute  only 
makes  preferences  void  which  are  made  by 
the  assignment  itself,  and  this,  by  the  lar- 
gest possible  construction,  cannot  go  be- 
.vond  such  acts  is  are  done  in  such  a  time 
and  manner  as  to  be  parts  of  the  same  trans- 
action, and  within  the  same  disposition, 
whereby  the  debtor's  entire  estate  is  applied 
to  the  payment  of  all  his  debts.  In  other 
words,  the  preferences,  to  come  Avithin  the 
language  and  meaning  of  the  statute,  must 
be  made  in  separate  form  to  avoid  the  ettect 
ivhich  the  statute  would  operate,  of  annul- 
ling them   if  thej'   were   included    in   the  as- 


signment itself.  The  assignment  hnv  shows 
no  intent  in  the  legislature  to  change  the  ex- 
isting statutes  against  frauds,  except  in  the 
one  particular  of  preferences;  and  it  would 
be  a  veiy  dangerous  and  unforttuiate  nde,  if 
it  could  be  legally  adopted,  Avhich  would  an- 
nul the  dealings  of  honest  persons  Avith  those 
Avhom  the.v  do  not  suspect  of  fraudulent  or 
tinhiAvful  designs." 

In  Burnham  v.  Haskins,  79  Mich.  3o,  44  N. 
W.  341.  a  bill  Avas  filed  to  declare  a  chattel 
mortgage  executed  contemporaneously  Avith 
an  assignment  for  the  benefit  of  creditors 
A'Oid  as  an  illegal  preference.  In  that  case, 
while  holding  under  the  testimony  that  the 
chattel  mortgages  Avere  executed  contempo- 
raneously Avith  the  assignment,  and  Avere 
part  of  the  sane  transaction,  we  expressly 
stated  that  AA'e  adhered  strictly  to  the  rule 
laid  doAvn  in  Root  a*.  Potter,  and  haA^e  tini- 
formly  upheld  security  taken  by  a  creditor 
for  a  bona  fide  debt,  under  circumstances 
and  testimoony  that  the  creditor  had  no  no- 
tice or  knowledge  that  the  debtor  contem- 
plated the  making  of  a  general  assignment, 
or  Avhere  the  acts  of  making  the  assignment 
and  giving  the  securit.v  Avere  done  in  such 
a  time  and  manner  as  not  to  be  parts  of  one 
and  the  same  transaction. 

Sheldon  v.  Mann  announces  the  correct 
doctrine,  in  these  Avords:  "The  creditor  has 
a  right  to  secure  and  to  collect  his  claim, 
even  if  he  knoAA's  that  his  debtor  is  insoh'ent. 
and  that  by  getting  his  claim  paid  he  de- 
prives other  creditors  of  the  opportunity  to 
secure  or  collect  their  delits.  At  common 
laAA',  a  general  assignment  for  the  benefit  of 
creditors  could  be  made  AA'ith  preferences. 
Nor  AA'as  the  debtor  compelled  to  make  an 
assignment.  He  could  dispose  of  his  prop- 
erty as  he  saAV  fit  in  the  payment  of  his 
debts,  if  it  Avas  all  applied  to  such  puri^ose; 
and.  Avhether  it  AA'as  all  so  applied  or  not. 
AvhateA'er  portion  of  it  was  applied  to  the 
payment  of  a  bona  fide  debt  could  not  be 
touched  or  disturbed  by  other  creditors.  The 
common  laAv  put  a  premium  upon  the  vigi- 
lance of  the  creditor,  and  there  are  not  want- 
ing those  Avho  doubt  to-day  the  equity  as 
AA-ell  as  the  Avisdom  of  bankuiptcy  laws. 
And.  under  the  law  of  this  state,  the  debtor 
has  the  right  to  prefer  one  creditor  over  an- 
other by  paying  his  debt  in  full  or  in  part. 
This  right  is  not  affected  by  the  debtor's  in 
solA^eney.  nor  by  the  creditor's  knowledge  of 
such  insolvency,  nor  b.A'  the  fact  that  others 
may  lose  the  entire  amount  of  their  delits 
credited  upon  the  faith  of  the  debtor's  own- 
ership of  the  property.  As  long  as  no  as- 
signment is  made  for  the  benefit  of  creditors, 
or  the  transaction  does  not  amount  in  laAv  to 
such  an  assignment,  the  delitor  is  at  liberty 
to  pay  or  secure  any  of  his  creditors  at  the 
expense  of  the  others.  It  Avill  be  found  that 
our  statutes  do  not  prohibit  preferences  un- 
less an  assignment  commonly  called  'com- 
mon-law assignment'  is  made.  Hoaa*.  Ann. 
St.  §  S739;    Rollins  v.  Van  Baalen,  50  Mich. 


CONVEYANCE  AND  ASSIGNMENT   FOR  BENEFIT  OF  CREDITORS. 


275 


<n4.  615,  23  N.  W.  332.  Aud  there  is  no  law 
fompelliuf;  a  debtor  to  make  an  assignment. 
As  I  understand  the  statute,  if  he  makes 
such  an  assignment,  lie  must  do  it  in  a  cer- 
tain way,  and  make  nc  preferences;  but,  if 
he  does  not  see  tit  to  make  an  assignment 
foT  the  benefit  of  liis  creditors,  he  can  dis- 
pose of  his  property  as  lie  sees  tit  in  the  pay- 
ment of  his  boua  fide  debts."  In  that  case 
the  debtor  owed  debts  to  Toledo  crediiors. 
which  he  secured  by  mortgages  amoviuting  to 
!f8.872.20.  Of  these,  three  were  given  to 
three  separate  creditors,  whose  claims 
amounted  to  .$7,016.29.  aud  such  mortgages 
were  intended  as  a  preference  to  those  cred- 
itors, and  it  was  the  validity  of  these  mort- 
gages which  was  attacked,  as  being,  in  ef- 
fect, a  common-law  assignment.  They  cov- 
ered all  of  the  debtor's  personal  property, 
and.  indeed,  all  of  his  property,  except  his 
homestead  and  store,  which  were  one  build- 
ing, and  a  piece  of  real  estate  called  the 
"Rink."  The  homestead  property  and  the 
rink  were  worth  about  $1.S(X).  and  were  sub- 
ject to  the  homestead  exemption  of  $1,.500. 
The  mortgages  in  dispute  were  filed  May  23. 
1890.  On  the  same  day  he  executed  a  mort- 
gage to  his  brother  on  his  homestead  and 
store  property  of  .$1,000.  aud  May  29th  anoth- 
er mortgage  on  the  rink  property,  to  secure 
another  Toledo  creditor,  for  .$2.").j.97.  He 
gave  four  mortgages,  which  were  filed  May 
23,  18W,  another  filed  March  28,  1800,  and 
seven  others,  which  were  filed  .lune  3d  of 
that  year.  These  last-named  mortgages  se- 
cured debts  in  the  aggregate  of  .$2.07(5.69. 
E.v  these  mortgages  he  appropriated  all  of 
his  property  for  the  payment  of  certain  speci- 
fied creditors,  and  left  out  creditors  entirely 
unsecured,  holding  about  the  same  amount 
of  credits  against  him.  The  property  was 
seized  under  the  first  three  mortgages,  and 
produced  only  .$.j.416.<)(i,  being  less  than  the 
amount  of  the  debts  secured  by  the  first 
three  mortgages.  The  facts  in  the  case  were 
quite  fully  stated  and  commented  upon  in 
the  opinion  of  Mr.  Justice  Morse.  Some  of 
those  facts,  and  the  comments  upon  them, 
have  been  misapplied,  and  <iuoted  and  relied 
upon  as  limiting  the  principles  of  law  enun- 
ciated in  that  case.  As.  for  instance,  it  is  ar- 
gued that  the  creditor  cannot  take  a  valid 
security  if  he  knows  of  the  insolvent  situa- 
tion of  his  debtor;  that  his  security  is  void  if 
it  covers  all  of  the  property  of  the  debtor; 
thus  overlooking  the  illustration  and  argu- 
ment contained  on  page  274.  8-"'>  Mich.,  and 
page  "7.5.  48  N.  W.,  and  also  what  was  said 
as  to  the  knowledge  of  the  creditor  of  the 
debtor's  insolvenc.v.  upon  page  273.  So  Mich., 
and  page  o~~>.  48  N.  W..  above  quoted.  The 
oiiiniou  also  states  that  no  assignment  was 
intended  to  be  made.  That  is  a  fact  that 
must  appear  outside  of  the  instrument.  It 
could  not  be  gathered  from  the  language  of 
the  instruments,  for  in  form  and  effect  they 
were  chattel  mortgages.  Immediatel.v  fol- 
lowing, it  is  stated  that  the  mortgagees  "ob- 


tained their  security  honestly,  aud  in  the 
usual  methods  of  business,  without  any 
thought  of  the  assignment  law.  But  wheth- 
er they  did  so  or  not,  whatever  their  mo- 
tives or  intent  maj'  have  been,  so  long  as  the 
securities  covered  no  more  than  the  amount 
of  their  just  and  houest  claims  against  Manu 
they  have  a  right  to  the  full  benefit  of  sucli 
securities,  unless  the  giving  of  these  three 
mortgages  upon  the  same  day  to  separate 
parties  can  be  declared,  in  law  and  in  fact, 
to  be  a  common-law  assignment  for  the  bene- 
fit of  all  his  creditors.  It  plainly  cannot  be 
so  declaimed  or  construed." 

The  case  here  under  consideration  falls  di- 
rectly within  the  principles  laid  down  ii) 
Sheldon  v.  Mann,  and  should  be  ruled  by  it. 
The  only  difference  is  one  that  does  not  affect 
its  character  as  a  chattel  mortgage,  viz.,  in- 
stead of  separate  mortgages  to  each  creditor, 
it  names  a  third  per.son  as  trustee;  and  this 
is  ixniuissible,  as  above  stated,  under  the  de- 
cisions of  this  state  upon  the  subject,  and 
was  expressly  held  not  to  be  fraudulent  per 
se  in  Bagg  v.  .lerouie,  7  Mich.  14.j.  There 
ought  to  be  and  is  some  underlying  principle 
from  which  to  determine  whether  an  instru- 
ment is  a  chattel  mortgage  or  a  common- 
law  assignment.  If  tl>e  instrument  is  a  con- 
veyance upon  condition,  given  as  a  security 
for  a  pre-existing  debt,  and  contains  no  trust 
in  the  body  of  the  instrument  whereby  the 
property  is  withdrawn  from  the  right  of  the 
mortgagor  or  others  to  redeem,  who  ordinari- 
ly have  such  rights  in  cases  of  chattel  mort- 
gages, or  whereby  the  title  of  the  property  is 
placed  beyond  the  reach  of  execution  as  to 
any  surplus,  then  the  instrument  is  not  an 
assignment,  but  a  chattel  mortgage.  But  if 
it  conve.vs  the  absolute  title  to  a  trustee  for 
the  benefit  of  creditors,  and  thus  places  the 
property  and  surplus  beyond  the  reach  of 
creditors,  it  is  a  common-law  assignment. 
Kendall  v.  Bishop  was  determined  upon  th's 
principle,  and  so  was  Root  v.  Potter  a'nd 
Sheldon  v.  Mann. 

The  question  as  to  whether  the  instrument 
is  a  chattel  mortgage  or  an  assignment  for 
the  benefit  of  creditors  must  in  all  cases  be 
determined  as  a  question  of  law  upon  the 
contents  of  such  instrument,  and  not  upon 
any  testimony  which  appears  outside  of  such 
instrument;  aud,  unless  the  conveyance  up- 
on its  face  purports  to  conve.v  all  of  the  debt- 
or's property  to  secui'e  some  creditors  in 
preference  to  others  by  an  absolute  title  upon 
its  face,  the  court  is  not  at  liberty  to  de- 
clare it  a  common-law  assignment;  and  if 
facts  appear  outside  of  the  instrument  itsi-lf 
Avhich  tend  to  prove  that  tlie  execution  of  tlie 
instrument  was  made  with  the  iuteution  of 
having  the  effect  of  a  common-law  assign- 
ment, or  with  the  intention  of  evading  the 
statute,  then  it  becomes  a  question  of  fact 
for  the  jurv  to  decide,  and  not  for  the  court. 
Bagg  V.  .Terome.  7  ^Nlich.  14.1;  Butler  v.  Did- 
dy  (Iowa)  49  N.  W.  99.">.  lu  the  latter  case 
it  was  held  that  "the  statute  providing  that 


276 


CUXVEYANCE  AND  ASSIGX.MKNT   FOR  BENEFIT  OF  CREDITORS. 


no  general  assignment  for  the  benefit  of  cred- 
itors shall  be  valid  unless  made  for  tJie  bene- 
fit of  all  the  creditors  applies  only  to  a  gen- 
eral assignment,  and  does  not  applj'  to  other 
conveyances  The  execution  of  mortgages 
by  an  Insolvent  debtor,  with  the  bona  tide  in- 
tention of  securing  particular  creditors,  does 
not  operate  as  a  general  assignment  for  the 
benefit  of  creditors."  And  upon  this  propo- 
sition the  court  cites  a  number  of  Iowa  cases. 
The  supreme  court  of  Iowa,  like  our  court, 
has  uniformly  held  that  where  mortgages 
were  given  in  good  faith,  with  the  intention 
of  securing  creditois  to  whom  they  were  exe- 
cuted, a  different  intention  than  what  the 
jiarties  had  could  not  be  given  them  by  the 
court.  And  in  the  case  last  cited  it  was 
further  said:  "Where  an  insolvent  executes 
n  mortgage  or  mortgages,  not  for  the  purpose 
and  with  the  intent  of  securing  a  pre-exist- 
ing indebtedness,  but  intending  the  same  for 
an  assignment  of  all  his  property,  divesting 
himself  thereby  of  the  title  to  all  his  proper- 
ty, and  where  the  same  is  made  in  view  of 
insolvency,  such  conveyance  shall  be  treated 
as  an  assign^nent;  but  where  an  assignment 
is  not  intended  by  the  parties  to  the  transac- 
tion, and  the  intention  is  only  to  secure  a 
pre-existing  indebtedness,  in  such  case  the 
instrument  is  a  mortgage,  and  should  be 
treated  as  such,  even  though  all  the  property 
of  the  debtor  is  taken,  and  he  is  left  insol- 
vent, and  there  are  other  creditors  who  have 
not  been  secured. '  This  court  has  more  than 
once  declaretl  that  an  insolvent  debtor  could 
not  be  compelled  to  execute  a  common-law 
assignment;  but  if  this  court  can  declare  an 
instrument  which  upon  its  face  is  a  chattel 
mortgage,  creating  only  a  lien  upon  the  prop- 
erty, to  be  a  common-law  assignment,  why  is 
the  debtor  not  compelled  by  the  decision  of 
this  court  into  making  a  common-law  assign- 
ment, and  that,  too,  against  his  wish  and  in- 
tention? 

The  statute  of  1879  does  not  attempt  to 
compass  the  object  and  purpose  of  the  insol- 
vent law.  It  does  not  prohbit  any  prefer- 
ence to  creditors,  unless  the  preference  is 
made  in  a  conunon-law  assignment.  It  con- 
tains no  provisions  for  the  discharge  of  a 
debtor  from  all  liability  in  case  he  transfers 
and  delivers  over  to  his  assignee  for  the  ben- 
efit of  all  his  creditors  all  of  his  property.  If 
the  debtor  makes  a  conmion-law  assignment, 
he  is  still  liable  for  any  balance  that  may  be 
due  to  his  creditors  after  his  assets  are  ap- 
plied by  his  assignee  to  the  pa.vment  of  his 
debts  pro  rata.  The  creditors  are  not  com- 
pelled to  accept  the  terms  proffered  in  the 
assignment;  they  may  stand  aloof  from  the 
assgnment,  and  may  rely  upon  the  liability  i 
of  their  debtor  to  pay.  There  is  no  provision 
for  recovering  preferences  made  on  the  eve  of 
assignment.  It  is  not  either  a  bankrupt  or 
insolvent  law.  It  is  of  nr)  practical  use.  and 
its  only  mission  seems  to  be  to  beget  litiga- 
tion, and  atTord  an  opportunity  for  a  creditor 
to  obtain   a   preference   over  other   creditors, 


by  asserting  and  occupying  the  inconsistent 
position  of  asserting  that  the  chattel  mort- 
gage given  to  secure  a  bona  fide  debt  is  a 
common-law  assignment,  and  therefore  ought 
to  be  construed  as  such,  and  void  as  to  cred- 
itors, while  he  attaches  or  levies  execution, 
and  thus  obtains  securities  and  preferences 
fully  as  unlawful  and  against  the  policy  of 
the  law.  In  Crow  v.  Beardsley.  68  Mo.  435, 
under  a  similar  statute,  the  court  held  that, 
if  the  instranient  was  attacked  upon  the 
ground  that  it  is  in  effect  a  common-law  as- 
signment, the  creditor  had  no  occasion  to  re- 
sort to  an  attachment,  because  he  would  have 
had  equal  rights  under  the  deed  with  those 
named  therein,  and  could  by  a  proper  pro- 
ceeding have  compelled  the  trustee  to  have 
discharged  his  duties  under  the  assignment 
law.  This  court  has  not  been  as  consistent, 
because  of  its  eft'orts  to  harmonize  the  stat- 
ute and  protect  the  rights  of  creditors.  We 
have  connnented  ttpon  the  manifest  imperfec- 
tions of  the  statute  in  failing  to  provide  suit- 
able provisions  for  carrying  out  its  design, 
and  we  have  held  that,  under  certain  circum- 
stances, the  creditor  might  proceed  by  at- 
tachment. Coots  v.  Radford,  47  Mich.  .37, 
10  N.  W.  G9;  Beard  v.  Clippert.  03  Mich.  719, 
30  N.  W.  323;  Wolf  v.  Slosson,  83  Mich.  543, 
47  N.  W.  341. 

The  case  of  Crow  v.  Beardsley  clearly  dis- 
tinguishes between  cases  where  the  instru- 
ment is  given  as  a  security  for  a  bona  fide 
pre-existing  debt  and  where  the  property  is 
absolutely  appropriated  to  the  payment  of 
the  debts.  And  the  court  held  thdt  the  in- 
strument, although  in  form  of  a  trust-deed, 
yet,  from  the  fact  that  it  contained  a  clause 
of  defeasance,  was  a  mortgage,  and  could 
not  be  construed  as  an  assignment,  and  that 
the  statute  could  not  be  extended  to  include 
constructive  assignments.  The  legislature 
of  Illinois  adoptetl  a  statute,  of  the  provisions 
of  which  ours  is  a  substantial  copy,  into  the 
statutes  of  that  state  in  1877.  Numerous  de- 
cisions of  their  supreme  court  upon  the  intent 
and  effect  of  the  statute  have  been  made.  In 
Preston  v.  Spaulding,  12U  111.  208,  10  N.  E. 
903,  it  was  held  that,  after  the  debtors  had 
made  up  their  minds  to  make  an  assignment 
of  their  property  for  the  benefit  of  their 
creditors,  all  conveyances,  transfers,  and 
other  dispositions  of  their  property  and  as- 
sets, made  in  view  of  their  intended  general 
assignment,  whereby  any  preference  was  giv- 
en, would,  in  a  court  of  equity,  be  declared 
void,  and  be  set  aside,  the  same  as  though  in- 
corporated in  the  deed  of  assignment  itself. 
In  this  case  preferential  payments,  convey- 
ances, and  confessions  of  judgment  to  rela- 
tives and  favorite  creditors  were  made  in 
view  of  an  intended  assignment,  which  al- 
most inunediately  followed.  And  it  was  held 
that  such  preferences  were  in  fraud  of  the 
statute,  and  that  the  property  so  transfer- 
red passed  under  the  deed  of  assignment  to 
the  assignee  in  trust  for  the  benefit  of  all 
the  creditors.     But  there  is  nothing  in   that 


COXVICYANCE  AND  ASSIGNMENT   FOR  RKNEFIT  OF  CREDITORS. 


277 


decision  wliidi  supports  the  ilnctriiie  of  con- 
structive assif^nnu'Uts.  or  tliat  the  series  of 
preferences,  transfers,  and  conveyances  made 
by  tlie  insolvent  in  view  of  an  early  assijrn- 
ment  would,  in  and  of  themselves,  consti.ute 
an  assignment.  In  Weber  v.  Mick,  lol  111. 
.120,  2.3  N.  E.  <i4(;,  the  court,  alludinj,'  to  the 
voluntary  assignment  act,  said:  "The  sub- 
ject-matter of  rlie  act  w-as  limited  to  volun- 
tary assignments,  and  even  if  it  had  con- 
tained express  provisions  attempting  to  deal 
with  or  regulate  involuntary  assignments,  or 
any  subject  other  than  the  one  embraced  in 
the  title,  such  provisions  would  have  been 
void  under  the  constitution,  §  13,  art.  4.  For 
the  same  reason  it  must  be  held  that  every 
attempt  to  apply  the  act,  or  any  of  its  pro- 
visions, by  construction,  to  any  subject  other 
than  voluut^^ry  assignments,  must  be  wholly 
unavailing."  And,  speaking  in  regard  to 
chattel  mortgages  executed  by  a  failing  debt- 
or, the  court  said:  "It  is  clear  then  that  they 
did  not  constitute  valid  assignments  for  the 
benefit  of  creditors,  within  the  meaning  of 
the  statute."  And  they  further  said  "that 
they  were  mere  chattel  mortgages,  executed 
for  the  sole  benetit  of  the  mortgagees,  and 
creating  no  trust  in  favor  of  any  of  the  cred- 
itors of  the  mortgagor."  And  in  Farwell  v. 
Nllsson,  1.33  111.  4.j,  24  N.  E.  74,  the  supreme 
coiu't  of  that  state,  adopting  the  opinion  of 
Judge  Moran  of  the  appellate  court,  said: 
"We  have  no  involuntary  assignments,  and 
we  know  of  no  principle  of  law  operative  in 
this  state  that  limits  or  controls  an  insolvent 
debtor  in  the  distribution  of  his  assets,  pro- 
vided  they   are  applied   in  the   discharge   of 


liona  fide  debts."  And  again:  "The  statute 
relating  to  the  assignment  by  debtors  for  the 
benetit  of  creditors,  prohibiting  [jreferences  in 
sui-h  assignments,  has  no  application  to  a 
case  of  this  kind.  Notwithstanding  that  stat- 
ute, a  debtor  may  pay  one  creditor  in  full  ei- 
ther in  money  or  by  a  sale  of  his  property. 
That  act  applies  only  to  conveyances  of  prop- 
erty to  an  assignee  or  trustee,  in  trust  to  con- 
vert the  same  into  money  for  the  benetit  of 
the  creditors  of  the  assignor,  which  can  now 
only  be  made  under  that  law."  And  the 
court  further  said:  "To  give  this  act  the 
scope  and  effect  here  contended  for  would  be 
to  far  exceed  the  legislative  intent.  *  *  * 
The  act  contemplates  no  such  thing  as  a  con- 
structive assigimieut,  and  that,  before  the 
county  court  gets  jurisdiction,  an  actual  as- 
signment nuist  be  made  and  recorded,  as  re- 
iiuired  by  the  act."  I  am  satistied,  however, 
that  the  judgment  should  be  reversed  upon 
other  grounds.  The  question  as  to  whether 
the  indebtedness  named  in  the  mortgage  ex- 
isted, the  extent  to  w'hich  it  did  exist,  the 
good  faith  of  such  indebtedness,  and  wliether 
the  facts  and  circumstances  attending  the 
transaction  had  any  tendency  to  substantiate 
the  claim  that  the  mortgage  Avas  executed 
with  the  intent  to  hinder,  delay,  and  defraud 
creditors,  should  have  been  submitted  to  the 
jury,  and  the  circuit  judge  was  in  error  In  not 
so  doing.  For  this  reason  I  think  the  judg- 
ment should  be  reversed,  nm^  a  new  trial 
granted. 

Mc(tRATH.  J.,  did  not  sit.     The  other  jus- 
tices concurred. 


278 


CONVEYANCE  AND   ASSIGNMENT   I'oK    r.HNKFIT   oF  CKEDITOKS. 


WARREN   V.  DWYER. 
(.")!  N.  W.  lOf.-J.  01  Mich.  414.) 
Supreme  Court  of  Miiliifran.     April  22,  1S02. 
Error  to  circuit  court,  Washteujnv  county; 
E.  D,  Kinuc.  .ludsc. 

Trover  b.v  Byron  K.  Warrcu  against 
CharlcM  Dwycr.  Verdict  was  directed  for 
idaiutiff.     Defeudaut    brings    error.    Atlirm- 

MORSE.  C.  J.  The  plaintiff  sued  in  trover 
to  recover  the  value  of  certain  lumber  and 
sl'.inirh's.  and  a  verdict  was  directed  in  his 
favor  for  $1,1S0.S0.  This  case  is  iiiled  by 
Sheldon  v.  Maun.  S.')  Mich.  2t>j.  48  N.  W.  .")7;i. 
See.  also.  Warner  v.  Littlefield  (Mich.)  ."iO 
N.  W.  721.  and  Fitzjrerald  v.  McCaudlish, 
Id.  SGO.  The  facts  are  substantially  as 
follows:  Prior  to  1887.  Samuel  W.  PJir- 
sons  and  George  W.  Parsons  were  in  part- 
nership in  Ypsilanti.  running  a  planing 
mill.  In  that  year  Samuel  W.  bought  out 
George  W..  and  assumed  the  indebtedness  of 
tlie  firm.  Soon  after  Samuel  W.  made  an 
oral  agreement  with  his  wife  to  enter  into 
partnership,  under  the  name  of  S.  W.  Par- 
sons &  Co.  The  wife  put  no  money  or  prop- 
erty into  the  business,  and  there  was  no 
agreement  how  much  she  should  contribute, 
but  it  was  understood  that  she  was  to  be  an 
e(iual  partner.  Quite  a  large  amount  of  the 
indebtedness  of  the  old  copartnership  be- 
tween Samuel  W.  and  George  W.  Parsons 
was  to  the  father  of  Mrs.  S.  W.  Parsons,  and 
it  was  talked  that,  when  her  father  died, 
the  part  coming  to  her.  as  heir  at  law,  would 
be  in  the  business.  When  the  father  died, 
part  of  this  indebtedness  was  paid  to  the 
other  heirs  by  giving  the  notes  of  S.  W. 
Parsons  &  Co.  November  20.  1889,  Parsons 
and  his  wife,  doing  business  under  the  firm 
name  of  S.  W.  Parsons  &  Co.,  executed  a 
chattel  mortgage  to  secure  certain  creditors 
upon  a  portion  of  the  copartnersliip  property, 
and  tiled  the  same.  This  was  done  without 
the  knowledge  of  the  creditors  sectired,  but 
they  were  immediately  notified  of  it  by  Mr. 
Parsons,  and  in  a  few  days  accepted  the 
security.  Upon  the  execution  of  this  mort- 
gage. Parsons  i-equested  one  Edwin  C.  War- 
ner to  take  possession  of  the  property,  and 
act  as  trustee  for  the  creditors  named  in 
this  mortgage,  which  he  did.  When  the 
creditors  first  came  to  Ypsilanti  they  maae 
arrangements  with  Warner  to  hold  the  pos- 
session for  them  for  a  few  days,  as  their 
agent,  which  he  did.  The  creditors  met  sub- 
sequently, and  appointed  the  plaintiff  as 
their  agent  to  foreclose  the  mortgage,  which 
he  proceeded  to  do.  After  this  first  raort 
gage  was  made.  Parsons  found  that  ne  nad 
unintentionally  left  out  some  creditors  that 
he  meant  to  have  named  in  the  first  mon- 
gage.  and  he  and  his  wife  executed  another 
u'.ortgage.  November  21.  1880,  covering  the 
same  property,  securing  the  parties  named 
in  the  first  mortgage,  and  also  the  others 
that  he  had  inadvertently  omitted   from  it. 


November  20,  1880.  they  executed  another 
mortgage  to  McCullougli  Bros,  on  patterns 
and  tlasks  in  their  poss(>ssion;  and  also  a 
mortgage  covering  stock,  book  accounts,  ma- 
chinery, and  fixtures  to  secure  a  number  of 
creditors  whose  nanus  appear  in  .said  mort- 
gage. I'arsons  asked  the  creditors  named 
in  tlie  first  mortgage  to  share  pro  rata  with 
those  additionally  named  in  the  second  mort- 
gage, but  they  refused  to  do  so.  The  lum- 
ber and  shingles  involved  in  this  suit  were 
covered  by  the  first  mortgage.  While  it  was 
in  the  possession  of  Edwin  C.  Warner,  but 
after  he  had  been  made  the  agent  of  the 
creditors  named  in  the  first  mortgage,  the 
defendant,  as  sheriR:  of  Washtenaw  county, 
levied  upon  it  l)y  Airtue  of  a  writ  of  attacli- 
ment  in  favor  of  Sawyer,  Goodman  &  Co.. 
and  against  S.  W.  I'arsons  &  (,'o.,  and  sold 
it  on  execution  upon  judgment  sul>se(iiiently 
taken  in  such  attachment  suit.  The  persons 
named  as  l)eneficiaries  in  this  first  mortgage, 
before  suit,  assigned  their  cause  of  action 
against  the  sheriff  to  the  plaintiff,  and  au- 
thorized him  to  prosecute  the  same  in  his 
own  name.  There  was  no  evidence  tending 
to  show  any  fraud  in  the  making  of  this 
first  mortgage,  or  any  of  the  others,  nor  any 
testimony  tending  to  show  that  any  of  the 
debts  thus  secured  were  not  bona  fide  obli- 
gations. The  giving  of  these  mortgages  did 
not  constitute  a  fraudulent  assignment,  bat 
was  a  legitimate  transaction,  for  reasons 
stated  in  the  cases  above  cited.  It  is  claim- 
ed that  individual  debts  of  Samuel  W.  Par- 
sons were  included  in  this  mortgage  upon 
the  pai'tnership  property,  but  the  proofs 
show  that  these  debts  were  incurred  l)y  Par- 
sons for  the  benefit  of  the  copartnership, 
and  were  really  partnership  obligations,  and 
had  been  assumed  as  such  by  the  firm. 

It  is  further  contended  that,  as  the  plain- 
tiff did  not  allege  in  his  declaration  the  as- 
signments of  the  mortgagees'  rights  of  action 
to  him.  they  could  not  be  introduced  in  evi- 
dence; that  he  could  not  recover  under  his 
declaration,  which  was  in  the  usual  form  In 
trover,  under  the  proofs  in  the  case;  citing 
the  following  cases:  Draper  v.  Fletcher,  26 
Mich.  154:  Rose  v.  .Jackson.  40  Mich.  30: 
Altman  v.  Fowler,  70  Mich.  .57.  37  N.  W.  708: 
Blackwood  v.  Brown.  32  Mich.  104;  Cilley 
V.  Van  Patten.  .58  Mich.  404.  25  N.  W.  320; 
Dayton  v.  Fargo.  45  Mich.  153.  7  N.  W.  7.^8. 
These  cases  do  not  apply.  In  replevin  and 
trover  there  is  an  authorized  form  of  decla- 
ration for  each  action  which  is  ordinarily 
used,  and  which  has  been  held  sufficient  in 
each  respectively.  These  declarations  do  ?'.:;t 
undertake  to  notify  defendant  of  the  nature 
of  the  plaintiff's  title,  or  what  are  the  evi- 
dences of  it.  These  are  matters  of  evidence 
merely.  Harvey  v.  Mc Adams,  32  Mich.  472: 
Myres  v.  Yaple.  60  :Mich.  .330,  27  N.  W.  536; 
Williams  v.  Raper,  67  Mich.  427.  34  N.  W. 
800;  Hutchinson  v.  Whitmore  (Mich.)  51  N. 
W.  4.51.  The  judgment  of  the  circuit  court 
is  affirmed,  with  costs. 

The  other  justices  concurred. 


CONVEYAN'CE  AND  ASSIGNMENT   FOIl  BENEFIT  OF  CREDITORS. 


279 


ARMSTRONG  et  al.  v.   COOK. 

(54  N    W.  873.  9.-5  Mich.  2.57.) 

tNupreme   Court  of  Michifrnn.      Ajiril   10.   1S0.3. 

Certiorari  to  firtuit  ccurt.  Siuiilac  county; 
AVatson  Beach,  .Tudgc. 

Attachment  by  Silas  Arm-stron?:  and  .A.1- 
bert  A.  Graves  ag^iinst  Henrj-  A.  Cook.  De- 
fendant moved  before  a  court  commissioner 
to  dissolve  the  attachment,  which  was 
jL'ranted,  and  plaintiffs  appealed  to  the  cir- 
cuit com-t.  From  an  order  of  the  circuit 
ciiurt  reversing  the  order  of  the  commis- 
.sicner,  defendant  brings  certiorari.  lie- 
versed. 

Dickinson,  Thurber  &  Stevenson  and  J.  B. 
Houck,  for  appellant.  Avery  Bros.  &  Walsh, 
(Farley  &  Aitkin,  of  cotmsel.)  for  appellees. 


GRANT,  J.  The  defendant  was  a  country 
merchant  doing  btLsiness  in  tte  village  of 
CrosTvell,  in  Sanilac  county.  Plaintiffs  were 
merchants  in  Port  Huron,  and  had  sold 
goods  to  the  defendant  to  the  amount  of 
§"243,  only  .?77  of  which  were  due  at  the 
time  this  suit  was  instituted.  November  12, 
1S90,  plaintiffs  sued  out  a  writ  of  attachment. 
and  caused  it  to  be  levied  upon  defendant's 
entire  stock,  wliich  was  then  worth  about 
$4,000.  They  gave  a  bond  in  attachment 
for  only  .$2(K3.  Defendant  moved  before  a 
circuit  court  commissioner  for  a  dissolution 
of  the  attachment,  which  was  gninted.  Plain- 
tiffs appealed  from  the  decision  of  the  com- 
missioner to  the  circuit  court,  which  re- 
versed the  action  of  the  commissioner,  and 
held  there  was  sufficient  ground  for  issuing 
the  attachment.  Plaintiff  Graves  made  the 
atfidavit  for  tte  attachment,  in  which  the 
sole  ground  alleged  to  justify  the  issuance 
of  the  writ  was  that  he  had  good  reason 
to  believe  that  defendant  was  about  to  a.s- 
sign  and  dispose  of  his  property  with  in- 
tent to  defraud  his  creditoi-s.  Graves  went 
to  Croswell  November  11th.  to  see  Mr.  Cook. 
Mr.  Cook  was  embarrassed,  and  had  not 
then  the  money  with  wliich  to  pay  his  in- 
debtedness. He  had  gone  to  Detroit  to  see 
hLs  creditors  there  with  a  view  to  arrange 
an  extension  of  time.  His  principal  creditors 
were  in  Detroit.  Mr.  Cook  had  a  clerk  and 
a  boy  in  the  store.  The  clerk  was  then  sick, 
and  when  Mr.  Cook  went  to  Detroit  the 
night  before,  he  reqtiested  Mr.  Houck.  who 
kept  his  books,  to  look  after  the  business 
in  his  absence.  Mr.  Graves  testified  that 
the  sole  reason  he  had  for  believing  that 
Cook  was  about  to  dispose  of  his  property 
Avith    intent    to    defraud    his    creditors,    was 


that  he  learned  that  Cook  had  given  a  mort- 
gage to  his  wife  on  September  19th  previotis 
for  $1..54<J:  that  ^'.mm)  or  $l,OfX)  in  drafts  had 
been  returned;  that  he  liad  taken  hLs  ledger, 
and  gone  to  Detroit,  to  fix  the  matter  up. 
While  in  Detroit.  Cook  arranged  with  his 
creditoi^  there  to  execute  a  mortgage  to  one 
ElUott,  to  secure  the  indebtedness  due  them, 
and  to  cover  future  advances.  He  returned 
from  Detroit  on  the  evening  of  the  12th. 
and  on  the  next  day  executed  thLs  mortgage. 
The  sole  question  is  whether  there  was  any 
evidence  to  sustain  the  attachment  proceed- 
ing, and  to  support  the  allegation  in  the 
affidavit  upon  which  the  writ  was  issued. 
We  think  the  evidence  shows  no  intent  on 
the  part  of  Cook  to  defraud  his  creditors. 
The  mortgage  to  his  wife  was  given  for  a 
valuable  consideration,  to  secure  her  for 
money  which  she  had  loaned  her  husband, 
and  which  had  gone  into  the  original  piir- 
chase  of  Ms  stock  of  goods.  At  the  request 
of  his  creditors  he  tried  to  induce  her, 
though  she  was  then  sick  and  upon  her 
deathbed,  to  relea.se  her  mortgage,  which 
she  declined  to  do.  He  had  very  naturally 
and  properly  taken  hLs  ledger  to  Detroit, 
in  order  to  show  liLs  creditors  there  his 
financial  condition.  The  Indebtedness  to  hLs 
Detroit  creditors,  sec-ured  by  the  mortgage  to 
them,  was  bona  fide,  and  they  were  willing 
to  extend  the  time,  to  funiish  him  more 
goods,  and  to  permit  him  to  pay  some  of 
his  small  debts  before  paying  them.  None 
of  the  provisions  of  this  mortgage  were 
per  se  fraudulent,  as  claimed  by  plaintiffs' 
counsel.  Mr.  Cook  had  a  right  to  mortgage 
aU  his  property  to  secure  a  past  bona  fide 
mdebtednesss  and  future  advances.  The 
statement  in  the  mortgage  that  it  should  "be 
a  continuing  security  until  discharged  by 
wilting,  and.  at  the  option  of  the  part>-  of 
Tie  second  part,  shoidd  be  as  binding  in 
•  all  respects  upon  the  as.<:igns  of  said  busi- 
ness of  the  first  party,  or  any  of  them,  as 
if  made  by  them  or  him  In  perse  n."  is  no 
badge  of  fraud.  This  clause  only  states  the 
log-il  effect  of  the  mortgage.  Without  it 
ihe  security  would  have  continued  imtil  dis- 
charged, and  would  have  bound  the  assigns 
of  the  mortgagor.  The  power  to  sell  at 
pubhc  or  private  sale,  and  the  power  to 
remove  the  goods  to  other  places  for  sale 
in  case  of  default,  are  not  imusual  provi- 
sions In  chattel  mortgages.  It  was  imdoubt- 
edly  understood  and  contemplated  that  the 
stock  might  be  sold  to  better  advantage  in 
some  other  place  than  in  the  smaU  village 
of  Croswell.  Judgment  reversed,  and  the 
attachment  proceeding  quashed.  The  other 
justices  conctirred. 


2b0 


CONVEYANCE  AND  ASSIGNMENT  I'OIt  BENEFIT  OF  CREDITOES. 


NUGENT  V.  NUGENT  et  al. 
Cn  N.  W.  TOG,  70  Mich.  52.) 

Supremo  Court  of  Michigan.     April  27,  ISSS. 

Appeal  Iroiu  circuit  court,  Kent  county,  in 
chiincery;    K.   M.  Montgomery,  Judge. 

Bill  by  James  Nugent,  as  judgment  creditor 
of  defendant  Daniel  Nugent,  to  set  aside  a 
conveyance  by  Daniel  to  defendant  Emanuel 
Nugent  as  in  fraud  of  creditors.  Complainant 
had  judgment,  and  defendant  Emanuel  ap- 
peals. 

Taggart.  Wolcott  &  Ganson.  for  appellant. 
John  C.  Quinsey  and  James  Nugent,  for  ap- 
pellees. 

LONG,  J.  The  facts  in  this  case  are  very 
well  stated  by  counsel  for  defendant,  and  are 
as  follows:  "The  bill  of  complaint  in  this 
case  is  filed  by  James  Nugent  as  judgment 
creditor  of  Daniel  Nugent,  one  of  the  defend- 
ants, to  set  aside  a  deed  of  lands  made  by 
Daniel  to  Emanuel,  upon  the  alleged  ground 
that  said  conveyance  is  fraudulent  and  void 
as  to  the  creditors  of  the  said  Daniel.  As  we 
understand  it,  the  case  turns  upon  questions 
of  law,  and  nearly  all  of  the  more  material 
facts  are  either  conceded  or  established  by 
clear  admissions  of  the  partj'  against  whom 
they  weigh.  Outlined  briefly,  they  are  as  fol- 
lows: In  the  spring  of  1871)  the  defendant 
Daniel  Nugent  was  a  single  man,  34  years 
old,  living  with  his  aged  and  widowed  moth- 
er, and  a  brother  and  sister,  (both  invalids  and 
unmarried,)  upon  the  old  family  homestead, 
an  80-acre  farm  in  the  township  of  Cannon, 
in  Kent  county.  Since  some  time  in  April, 
1877,  Daniel  had  held  the  legal  title  to  this 
farm,  subject  (1)  to  a  lease  of  the  same  to 
Mary  Nugent,  his  mother,  for  the  term  of  her 
life;  and  (2)  a  lease  of  the  south  half  of  the 
same  to  his  brother  John,  which  Avas  to  take 
effect  at  the  death  of  his  mother,  and  contin- 
ue for  the  life  of  the  said  John  Nugent;  and 
(3)  subject,  further,  to  a  mortgage  for  $1,000, 
given  in  1877  for  the  benefit  of  his  sister  Ce- 
cilia, upon  which  there  was  about  two  years 
of  interest  accrued.  He  also  owned  120  acres 
adjoining  the  homestead,  which  was  incum- 
iK'red  with  mortgage  to  James  Nugent,  the 
complainant,  for  $3,200  and  accrued  interest. 
Daniel  had  been  working  the  farm,  and  taking 
care  of  the  family,  imder  some  arrangement 
with  his  mother,  who  held  the  life-lease. 
The  defendant  Emanuel  Nugent  is  an  elder 
brother,  who  was  living  upon  his  own  farm  in 
the  adjoining  township  of  Grattan.  about  four 
miles  from  the  old  homestead.  Daniel  had 
become  dissatisfied  with  his  surroundings,  and 
April  30,  1879,  he  left,  stating  that  he  was 
going  to  Colorado  and  the  mining  country  of 
the  west.  Before  his  departure  he  deeded  all 
his  lands  to  Emanuel,  and  also  gave  him  a 
l)ill  of  sale  of  his  farming  tools,  stoclv,  and 
other  personal  property,  amounting  to  .$1,000 
or  $1,200  in  value.  Emanuel  expressly  as- 
Kiuned  the  mortgage  for  $3,200.  and  look  the 
80-acre  farm   subject  to   the  $1,000   mortgage 


and  the  two  life-leases,  and  he  also  assumed 
certain  debts  of  Daniel,  amounting  to  about 
$;>00,  and  including,  so  far  as  appears,  all  of 
Daniel's  unsecured  debts,  except  about  $800 
or  $1,000  of  notes  in  the  hands  of  his  mother 
and  brothers.  After  his  departure.  Daniel 
wrote  quite  often  to  ditTerent  members  of  the- 
family,  up  to  August  or  the  1st  of  Septem- 
ber, 1879,  at  which  date  two  letters,  written 
at  Leadville,  Col.,  were  received.  Nothing  has 
been  heard  from  or  of  him  since  then,  except 
vague  rumors,  though  a  good  deal  of  ettort 
has  been  made,  by  advertising  in  the  newspa- 
l»rs  and  other  means,  to  obtain  information 
as  to  his  fate.  When  Daniel  went  away, 
about  the  30th  of  April,  1879,  complaiimnt 
was  a  law  student  at  Ann  Arbor.  About  the 
1st  of  June  he  came  to  the  homestead  in 
Grattan,  and  stayed  some  weeks,  leaving  July 
6  or  7,  1879,  after  a  somewhat  stormy  talk 
with  p]manuel,  in  which  he  was  charged  by 
Emanuel  with  stirring  up  trouble,  which  he 
denied,  and  retorted  with  charges  of  like  na- 
ture against  Emanuel.  In  the  spring  of  1880, 
the  complainant,  with  full  knowledge  of  the 
whole  matter,  settled  with  defendant  Eman- 
uel, and  received  a  deed  of  the  120  acres  cov- 
ered by  his  mortgage  from  Daniel,  in  full 
satisfaction  of  that  mortgage  and  notes,  then 
amounting  to  $3,400,  or  upward.  He  has  since 
sold  and  conveyed  the  gi-eater  portion  of  these 
lands  to  third  parties,  who  have  conveyed  to 
still  others.  In  September,  1880,  the  said  Maiy 
Nugent,  the  mother  of  the  parties  to  this  suit» 
together  with  her  two  sons,  Joseph  F.  and 
John,  and  her  daughter,  Cecilia,  filed  their 
bill  of  compliiint  by  the  said  James  Nugent, 
their  solicitor,  in  the  circuit  court  for  the  coun- 
ty of  Kent,  in  chancery,  against  said  Eman- 
uel Nugent  as  defendant;  alleging,  among 
other  things,  that  the  conveyance  of  said  prop- 
erty, real  and  personal,  from  Daniel,  was 
made  and  received  in  tmst  for  the  payment 
of  the  debts  and  obligations  of  said  DanieU 
and  more  especially  the  debts  owing  to  the 
complainants  in  said  suit.  This  bill  was  held 
bad  on  denmrrer,  and  was  dismissed  by  the 
complainants  on  their  own  motion,  rather 
than  to  amend.  In  August,  1882,  complain- 
ant, James  Nugent,  acting  in  the  name  and  on 
behalf  of  Mary  Nugent,  his  mother,  began  an 
attachment  suit  against  Daniel  Nugent  by  fil- 
ing his  affidavit  in  the  circuit  court  for  lue 
count^^  of  Kent,  which  finally  resulted  in  the 
judgment  and  le\y  which  are  set  out  in  the 
bill  of  complaint  in  this  case.  The  original 
bill  was  filed  by  Mary  Nugent  as  complainant,, 
but  James  Nugent,  who  is  the  complainant  in 
the  final  bill  of  revivor  and  supplement,  came 
into  the  case  under  an  assignment  of  said 
judgment,  and  the  notes  on  which  it  is  based. 
After  hearing  on  pleadings  and  proofs,  the 
circuit  court  made  a  decree  substantially  as 
prayed  in  the  bill,  except  that  it  reduced  the 
amount  of  complainant's  lien  to  $1,101.74, 
From  this  decree  defendant  Emanuel  Nugent 
appealed  to  this  court." 
There  are  several  distinct  grounds  of  objec- 


CONVEYANCE  AND  ASSIGNMENT  FOR  BENEFIT  OF  CREDITORS. 


281 


tion  to  tbe  decree  of  the  circuit  court.  Tlie 
judgmeut  wLiicli  this  bill  is  filed  to  enforce 
was  recovered  in  a  suit  began  in  August, 
1S82,  by  attachment  against  a  non-resident  de- 
fendant, who  was  not  served  with  process, 
and  who  never  appeared  in  any  mann(!'r  in 
the  cause.  It  is  claimed  that  the  proceedings 
in  this  attachment  suit  did  not  comply  with 
the  requirements  of  the  law.  The  atlidavit 
for  attachment  was  made  and  tiled  August 
4,  1882,  and  the  writ  issued  the  same  day,  re- 
turnable September  5,  1882.  The  statutoiy 
notlce  of  attachment  was  published  for  six 
weeks  beginning  September  28,  1882,  and 
proof  of  publication  was  filed  December  28, 
1882.  The  declaration  was  filed  September 
2,  1882.  which  was  prior  to  the  retm-n-day  of 
the  writ,  and  three  months  and  twenty-six 
days  before  the  filing  of  the  affidavit  of  publi- 
cation of  notice  of  attachment.  The  declara- 
tion was  prematurely  tiled.  Section  8005. 
How.  Ann.  St..  provides:  "If  a  copy  of  the 
attachment  shall  not  have  Iteen  served  upon 
any  of  the  defendants,  and  none  of  them 
shall  appear  in  the  suit,  the  plaintiff,  on  fil- 
ing an  affidavit  of  the  publication  of  the  no- 
tice hereinbefore  required,  f  .r  six  successive 
weeks,  may  file  his  declaration  in  the  suit, 
and  proceed  therein  as  if  a  copy  of  such  at- 
tachment had  been  served  upon  the  defend- 
ants." In  suits  by  attachment,  where  no  per- 
sonal service  of  the  writ  has  been  obtained, 
and  tlie  defendant  has  in  no  manner  appeared 
in  the  cause,  a  strict  compliance  with  statu- 
tory requirements  is  essential  to  the  vahdity 
of  th'?  judgment.  In  Woolkins  v.  Haid,  49 
Mich.  209.  13  N.  W.  .">0S,  the  declaration  was 
filed  four  days  prior  to  the  filing  affidavit  of 
publication  of  notice  of  attachment,  and  this 
court  held   the  judgment  void.     In   Steere  v. 


Vanderberg  (Mich.)  35  N.  W.  110,  the  writ 
of  attachment  was  issued  September  5,  1884, 
returnable  September  12,  1884.  Declaration 
was  filed  November  21,  1884,  and  affidavit 
of  publication  of  notice  of  attachment  was  fil- 
ed November  29,  1884,  the  affidavit  being  filed 
eight  days  after  the  filing  declaration,  and  this 
court  held  the  declaration  prematurely  filed, 
and  the  judgment  void.  In  the  above  case, 
Mr.  Justice  Champlin  said:  "It  is  a  settled 
rule  of  law  that  all  exceptional  methods  of  ob- 
taining jurisdiction  over  persons  not  found 
within  the  state  mu.st  be  confined  to  the  cases 
and  exercised  in  the  way  precisely  indicated 
by  the  statute;  and  it  may  also  be  regarded 
as  settled  law  that  a  failure  to  comply  with 
statutory  re<iuirements,  when  the  jurisdiction 
conferred  is  spe<:ial,  and  no  personal  servic*e 
is  obtained,  renders  the  judgment  null  and 
void;"  and  citing  Thompson  v.  Thomas.  11 
Mich.  274;  King  v.  Harrington,  14  Mich. 
532;  MiUar  v.  Babcock.  29  Mich.  52G;  John- 
son V.  Delbridge,  35  Mich.  430;  Rolfe  v.  Dud- 
ley, 58  Mich.  208,  24  N.  W.  057.  The  pro- 
ceedings may  be  attacked  collaterally.  Millar 
v.  Babcock,  29  Mich.  526;  King  v.  Harring- 
ton, 14  Mich.  .532.  This  case  must  be  niled 
by  the  foregoing  cases.  The  judgment  upon 
which  this  proceeding  is  foimded  must  be 
held  void  and  of  no  effect.  As  only  a  judg- 
ment creditor  could  maintain  this  bill,  it  fol- 
lows that  the  case  must  fail,  and  we  need  not 
discuss  the  other  questions  raised.  The  de- 
cree of  the  court  below  must  be  reversed,  and 
a  decree  entered  in  this  c-omt  dismissing  com- 
plainant's bill,  with  costs  of  both  courts  to 
defendant. 

CHAMPLIN    and   MORSE.    .JJ.,    concurred. 
SHERWOOD,  C.  J.,  did  not  sit. 


282 


CONVEYANCE  AND  ASSKINMENT  FOR  BENEFIT  OF  CREDITORS. 


TROWBRIDGE  ct  al.  v.  BULLARD. 

(4;-)  N.  W.  1012,  81  Mich.  4.j1.) 

Supremo  Court   of   Michigan.     June  13,   1890. 

.Vpptvil  from  circuit  court.  Van  Buren 
coiiMly;  (iKfdicK  ,M.  BrcK,  Judiic 

Mills.  Oslxjrn  A-  (ioss,  for  ai>i)cliant.  E. 
R.  Annnhir,  for  appellees. 

LONU,  J.  There  is  no  controversy  over 
tlie  facts  in  this  case.  As  they  appeared 
upon  the  trial  in  the  court  below,  they  arc 
sul)stantially  as  follows:  On  the  '22(\  of 
Septeiuher.  ISnS.  Messrs.  ("lark.  Baker  & 
Co.,  who  were  v.holesr;le  grocers  at  Jack- 
son, in  this  state,  had  a  claim  against  one 
Frank  Potts,  of  Decatur,  and  to  recover 
and  collect  it  commenced  a  suit  by  attach- 
ment in  the  circuit  court  for  Van  Buren 
county.  The  writ  of  attachment  was  de- 
livei'ed  to  James  F.  Bullard,  who  was  then 
the  under-sheriff  of  the  county  of  Van 
Buren.  On  the  22(\  day  of  .September,  Bul- 
lard attached  a  tiuantity  of  in-operty, con- 
sisting largely  of  teas,  as  the  property  of 
Frank  Potts;  the  same  being  then  in  the 
custody  of  Trowbridge  &  Roberts,  who 
claimed  to  liave  purchased  it  of  Potts.  It 
was  claimed  that  Potts  had  fraudulently 
dis]Josed  of  the  property  to  Trowbridge 
&  Ivoberts,  to  cheat  and  defraud  his  cred- 
itors. The  oHIcer  was  unableto  find  Potts 
within  hiscounty,  and  could  not  make  per- 
sonal service  of  the  attachment  upon  him. 
The  writ  of  attachment  wasin  all  respects 
properly  returned;  and  on  the  PStli  day  of 
Oct(jber.  INSS.  a  notice  was  published  of 
the  issuing  of  the  attachment  pursuant  to 
law.  On  the  2Sth  of  November,  proof  of 
publication  of  said  notice  of  attachment 
was  made.  On  the  same  day  an  affidavit 
was  filed  of  the  non-appearance  of  the  de- 
fendant Potts,  and  the  plaintiffs  also  filed 
their  declaration.  On  5s'ovember  2Sth  the 
default  of  Potts  for  want  of  appearance 
was  entered.  On  November  ."JUth  such  de- 
fault was  made  absolute.  On  December 
12,  1888,  a  judgment  was  rendered  in  favor 
of  Clark,  Baker  &  Co.,  and  against  Potts, 
for  $206  and  costs.  On  the  13th  day  of  De- 
cember, IsSS,  execution  upon  such  judg- 
ment was  issued  and  delivered  to  Bullard. 
who  on  the  17th  day  of  December  levied 
upon  the  same  property  which  he  had  at- 
tached, and,  after  giving  a  proper  and  suf- 
ficient notice,  sold  the  property  to  Clark, 
Baker  &  Co..  the  plaintiffs  in  tjie  attach- 
uient  suit,  on  the  "ith  day  of  March,  188'J. 

v^n  .March  .j,  1880,  Theodore  Trowbridge 
and  Lewis  D.  Roberts  commenced  a  suit 
in  the  circuit  court  for  Van  Buren  county 
against  James  F.  Bullard  by  summons, 
and  on  May  1,  1889,  tiled  a  declaration  as 
against  him.  in  trover,  for  the  property  in 
question.  The  defendant  appeared  on  the 
l.jth  of  May,  and  filed  a  plea  of  the  general 
issue,  and  gave  notice  of  the  justification 
under  the  attachment  proceedings,  and  al- 
so under  the  levy  of  said  e.xecution.  At 
the  trial,  Theodore  Trowbi'idge  was  sworn 
in  behalf  of  the  plaintiffs,  andgaveevidence 
tending  to  show  the  purchase  of  the  prop- 
erty by  himself  and  his  co-plaintiff,  Rob- 
erts, of  the  defendant  Potts.  Cpon  cro.ss- 
oxamination.it  wassoughtin  behalf  of  the 
ilefendaiit    to   show    that    this    sale    was 


fraudulent,  and  made  with  intent  to  cheat 
and  defraud  the  creditors  of  Potts.  The 
plaintiffs'  attorneys  objected  to  this,  and 
the  court  ruled  that  the  testimony  was  in- 
ailmissible,  ami  not  propercross-examina- 
tion,  as  the  case  stood  under  the  state- 
ment of  counsel.  The  plaintiffs  also  gave 
evidence  tending  to  show  the  value  of  the 
property,  and  rested  their  case.  Upon 
the  i)art  of  the  defendant,  the  proceedings 
in  attachment  were  offered  in  evidence, 
and  some  testimr)ny  was  given  controvert- 
ing that  introduced  upon  the  part  of  the 
])laiiitiffs  as  to  the  value  of  the  property. 
The  plaintifls  then  introduced  in  evidence 
the  balance  of  the  proceedings  in  the  at- 
tachment suit,  infduding  the  judgment,  ex- 
ecution, and  the  levy  and  sale  thereunder. 
It  will  be  seen  that  the  default  of  the  de- 
fendant was  entered  with'n  three  days 
after  the  filing  of  the  plaintiffs'  declaration 
therein,  and  that  the  judgment  was  en- 
tered wMthin  twelve  days  of  that  time,  it 
is  conceded  by  defendant's  counsel  that  the 
judgment,  and  the  proceedings  thereunder 
to  sell  the  property,  are  void.  The  defend- 
ant, however,  claimed  the  right  to  justify 
underthe  attachment ;  insisting  that,  if  the 
judgment  was  void,  the  attachment  was 
still  valid  in  his  hands,  and  an  ample  and 
sufficient  justification  to  him,  provided  it 
could  be  shown  that  the  sale  to  the  plain- 
tiffs was  fraudulent,  and  that  the  prop- 
erty attached  was  liable  to  attachment  by 
the  creditors  of  Potts.  The  court  held, 
however,  that  the  defendant  could  not 
justify  thereunder,  and  directed  the  jury 
that,  if  they  found  the  property  had  been 
sold  by  Potts  to  Trowbridge  &  Roberts, 
they  (the  plaintiffs  in  the  acticui)  would  lie 
entitled  to  a  verdict  for  the  value.  Veidict 
and  judgment  was  given  for  plaintiffs 
for  the  value  of  the  property.  Defendant 
brings  error. 

The  only  question  raised  is  whether,  un- 
der the  circumstances,  the  defendant  was 
entitled  to  attack  the  transfer  of  the  goods 
to  the  plaintiffs  as  fraudulent,  though  the 
judgment  upon  which  the  execution  issued 
was  void.  It  is  claimed  by  counsel  for  the 
defendant  that,  though  the  judgment,  and 
execution,  levy,  and  sale  thereunder,  were 
void,  yet  that  the  attachment  remained 
unimj>aired,  and  the  othcei"  had  the  right 
thereunder  to  show  that  the  alleged  pur- 
chase by  Trowbridge  &  Roberts  was 
fraudulent.  The  only  evidence  which  de- 
fendant offered  which  was  excluded  by 
the  court  was  his  proposal  to  show  that 
the  purchase  by  plaintiffs  from  Potts  was 
fraudulent  as  to  his  creditors;  and  the 
title  of  plaintiffs  to  the  goods  in  contro- 
versy was  not  attempted  to  be  impeached 
upon  any  oth'T  ground.  The  claim,  there- 
fore, was  that,  inasmuch  as  the  defendant 
had  on  September  22,  1888,  seized  and 
taken  these  goods  from  the  possession  of 
Trowi)ridge  &  Roberts  under  a  valid  writ 
of  attachment  issued  against  Mr.  Potts, 
he  could  attack  the  title  of  Trowbridge 
&  Roberts  as  fraudulent  against  the 
creditors  of  Potts,  though  he  had  not 
followed  up  the  writ  of  attachment  to 
judgment.  It  is  further  insisted  that  the 
case  must  be  governed  by  its  status  at  the 
time  the  plaintiffs' suit  against  the  defend- 
ant   was  commenced,    and    that    at   that 


CCNVEYAXrE   AXD  ASSIGNMENT   FOR  BENEFIT  OF  CREDITORS. 


283 


;iiiio  no  unreasonable  time  had  elapsed 
after  the  period  at  which  a  valid  judgment 
niight  have  been  entered;  that,  when 
prcjpert.y  is  seized  under  attacliment,  it  is 
in  the  custody  of  the  law,  and  tlie  officer 
Is  bound  to  produce  it  to  s;itisfy  aTiy  judj;-- 
nient  wliicii  may  be  obtained  in  the  pro- 
ceedinji,  and  theofficermay  justify  underit. 
and  tliereforeit  is  a  protection  to  him.  Hut 
tiu' difficulty  of  this  position  is  tliat  the 
officer  is  not  ojdy  seckiiiji:  to  justify  his  ac- 
tion in  holdiufi,-  the  proi)erty  this  len;.;th  of 
time,  but  is  also  endeavorin<;-  to  assail  the 
title  of  others.  He  lias  not  seized  {i,(iods  in 
the  hands  of  I'otls,  the  defendant  in  the 
writ,  and  confessedly  owned  by  him  ;  but 
he  has  taken  jj,-oodsa\vay  from  Tro\vbi'id<j,e 
&  Roberts,  to  which  they  assert  title  un- 
der a  purchase  from  Potts,  and  is  seeking 
to  hold  them  on  the  ground  that,  by  vir- 
tue of  a  writ  against  Potts  in  favor  of  cer- 
tain of  his  creditors,  he  is  in  i)osition  to 
■contest  the  right  set  up  by  the  i)laintiffs. 
Tne  rule  is  that  judgment  creditors  may 
ct)ntestthe  title  in  such  cases,  but  that  the 
general  creditors  cannot  do  so.  It  has 
many  times  been  held  by  this  court  that 
general  creditors,  having  no  judgment  or 
lien  on  the  debtors'  property,  cannot  at- 
tack conveyances  or  other  dealings  for 
fraud.  McKibben  V.  Barton,  1  Mich.  213; 
Mavnard  v.  Hoskins,  !)  Mich.  4Sr);  Tvler  v. 
Peatt,:]0  Mich.  (>:;5;  Griswold  v.  Fuller,  33 
Mich.2i;s;  Stoddard  v.  McLane,,')!!  Mich.  11, 
22  N.  W.  Rep.  S)5;  Root  v.  Potter,  59  Mich. 
'ins,  20  N.  W.  Rep.  (;s2;  8cott  v.  Chambers, 
(;2  Mich.  532,  29  N.  W.  Rep.  94;  Krolik  v. 
Root.  63  Mich.  5(52,  30  N.  W.  Rep.  339.  It  is 
undoubtedJy  true  that,  had  this  action 
been  brought  before  a  reasonal)le  time 
had  elapsed  for  the  taking  of  judgment 
and  issue  of  execution,  the  officer  holding 
the  writ  of  attachment,  and  representing 
the  parties  in  interest,  might  have  attacked 
the  borui  fides  of  the  i)lain tiffs"  ])urchase. 
The  fact  that  an  attachment  is  issued  be- 
fore the  debt  is  conclusively  established  on 
wliich  it  is  founded,  and  that  it  may  sub- 
sc(|uently  l)e  sliown  by  the  defendant  in 
the  attachment  that  there  is  no  such  debt, 
is  not  suthcient  reason  for  holding  that 
the  attaching  creditor  cannot  slunv  that 
t!ie  i)roperty  attached  is  in  fact  the  debtor's, 
when  sued  for  it  by  a  third  person,  who 
claims  it  by  a  title  which  is  fraudulent  as 
against  the  attachingcreditor.  Such  third 
person  may  show  that  no  such  debt  exist- 
ed until  it  is  established  by  a  judgment  in 
the  attachment  suit.  He  may  therefore 
defeat  the  attaching  creditor  on  either  of 
two  grounds:  (1)  That  there  was  no  debt 
to  justify  the  issuing  of  the  attachment ; 
(2)  that  he  had  a  good  title  to  the  prop- 
erty in  disi)ute  when  it  was  attached.  Of 
course  the  officer  must  fii-st  prove  the  ex- 
istence of  the  debt  for  which  the  attach- 
ment was  issued,  when  such  debt  has  not 
been  established  by  a  judgment  against 
the  debtor.  When  that  is  done,  the  judg- 
ment proves  it.  Rinchpy  v.  Stryker,  2.^  IS'. 
Y.  .51.  In  the  present  case,  however,  there 
Avas  no  testimony  given  or  offered  to  be 
given,  on  the  part  of  the  defendant,  that 
Potts  was  indebted  to  Clark,  Baker  &  Co., 
the  plaintiffs  in  the  attachment  suit.  The 
judgment  was  offered  in  evidence  by  the 
plaintiffs   for  the  purpose   of   showing   its 


irregularity,  but  it  appears  that  the  judg- 
ment was  void.  It  did  not  prove  the  in- 
debtedness. It  nijiybe  that  counsel  f(jr de- 
fendant was  misle(i  as  to  their  rights  un- 
der the  writ  by  the  oi)inion  and  ruling  of 
the  trial  court.  It  was  the  opinion  (jf  the 
coiirt  that,  tlujugh  the  attacliment  was  a 
valid  one,  yet,  when  the  (jfficer  took  the 
property  under  the  execution,  he  no  longer 
lield  it  undi'r  the  attachment,  any  more 
than  as  if  hehad  turned  it  over  to  another 
party;  that  l^is  attachment  was  ended, 
and  that,  the  judgment,  execution,  levy, 
and  sale  being  void,  the  ofhcer  wfis  not  in 
a  position  to  contest  the  plaintiffs'  title  to 
the  jji'opcrty ;  and  that  the  only  (juestion 
open  f(M'  contest  was  the  value  of  the 
goods  attached.  Counsel  for  defendant 
took  excejition  to  this  ruling,  and  desisted 
from  further  cross-examination  of  plain- 
tiffs' witnesses.  However,  when  he  came 
to  make  his  direct  case  in  his  defen.se.  he 
utterly  failed  to  show,  and  made  no  effort 
to  show,  that  Potts  was  indebted  to 
Clark,  Baker  &  Co.. the  i)laiiitiffs  in  the  at- 
tachment. The  defendant,  under  any  cir- 
cumstances, had  no  right  to  attack  i>lain- 
tiffs' title  for  fraud  until  he  showed  hislien 
under  the  attachment,  and  proved  the 
del)t  against  Potts.  This  fact  justified  the 
verdict  and  judgment  rendered  in  thecase. 
But  the  circumstances  shown  upon  this 
record  did  not  warrant  the  claim  made  by 
defendant's  counsel.  The  attachment  was 
issued  and  levied  on  September  22,  ISSS; 
and  the  present  suit  was  not  c(jnimenced 
until  March  5,  1889.  In  the  mean  time  the 
defendant  had  sold  and  disposed  of  all  the 
property  held  under  the  writ.  This  prop- 
erty was  taken  and  sold  by  virtue  of  this 
void  execution.  Nearly  six  months  had 
elapsed  from  the  time  the  property  was 
taken  from  the  plaintiffs' possession  before 
the  suit  to  recover  its  value  was  com- 
menced. The  action  is  in  trover  for  a  con- 
version of  the  property.  The  property 
was  not  in  the  custody  of  the  law  at  the 
time  the  suit  was  commenced.  Neither 
was  it  at  that  time  held  under  legal  process. 
The  writ  of  attachment,  though  valid,  had 
performed  its  office.  Fnder  it  thepropertj' 
had  been  held  to  await  the  time  of  its  be- 
ing turned  over,  and  to  be  levied  upon  by 
the  execution.  It  was  so  levied  upon  and 
taken  out  of  the  protection  of  the  writ  of 
attachment.  The  execution,  as  has  been 
seen,  was  void,  and  was  therefore  no  jus- 
titication  to  the  officer  to  take  the  prop- 
erty, and  hold  it  or  sell  it,  against  the 
rights  of  the  i)laintiffs.  If  the  oiticer  could 
justify  the  holding  under  an  attachment 
under  such  circumstances  at  the  e;id  of  six 
months,  then  he  might  do  so  at  the  end  of 
a  year  or  of  live  years.  The  office  of  the 
writ  of  attachment  is  to  hold  the  property 
until  tin- coming  of  an  execution  to  enforce 
the  judgment  against  the  [iropiu-ty  of  the 
debtor,  so  that  the  debtor  may  not  put 
his  jtroperty  beyond  the  reach  of  su.-h 
creditor  when  he  shall  obtain  his  judg 
ment;  but  the  creditor  has  no  right  to 
hold  the  property  beyond  a  reascuiable 
time  to  obtain  his  judgment  and  issue  and 
levy  his  execution,  and  the  attachment  is 
no  justit1catit)n  to  the  officer  in  selling  and 
disposing  of  the  property,  unless  it  is  done 
under  the  execution  thereafter  issued.   The 


284  CONVEYANCE  AND  ASSIGNMENT  FOR  BENEFIT  OF  CREDITORS. 


writ  of  attachment  confers  no  right  to  sell 
the  property  except  in  special  cases,  when 
ordered  by"  the  court.  The  officer  had 
sold  the  property  on  a  void  execution,  and 
applied theproceedsupon  avoid  judgment. 
The  sale  and  conversion  of  the  property 
•inder  this  void  writ  of  execution  was  un- 
lawful, and  the  officer  must   be  held  liable 


in  this  action  of  trover.  McGough  v. 
Wellington,  6  Allen,  505;  Sawyer  v.  AVil- 
son,  61  Me.  529.  There  was  no  error  in 
the  ruling  of  the  court,  under  the  circum- 
otances  here  stated;  and  the  defendants 
offered  no  proof  which  would,  if  admit- 
ted, have  amounted  to  a  ju^^^^ification. 
The  judgment  must  beaffirmed,  with  costs. 


CONVEYANCE   AND  ASSIGNMENT   FUK  BENEFIT  OF  CREDITORS. 


285 


GRAY  V.  FINN  ct  al. 

(55  N.  W.  G15,  9G  Mich.  G2.) 

i>>nprpme  Court  of  ^lichigan.     Juno   10.   180.3. 

Error  to  circuit  court,  St.  Clair  county; 
Arthur  L.  Cautit'ld,  Judge. 

Action  by  Samuel  J.  Gray  against  John  E. 
Finn  and  another  to  replevin  propt-rty. 
Judgment  was  rendered  for  defendants,  and 
plaintiff  appeals.    Affirmed. 

Frank  "SMiipple,  for  appellant.  P.  11.  Phil- 
lips, for  appellees. 

GRANT,  J.  Defendant  Finn  was  collector 
of  taxes  for  the  Fourth  ward  of  the  city  of 
Port  Huron.  By  virtue  of  his  tax  warrant 
he  levied  upon  certain  personal  property, 
as  belonging  to  one  Lewis  Potts,  to  satisfy 
a  personal  tax  assessed  against  him.  Plain- 
tiff, claiming  to  own  the  property,  brought 
this  action  of  replevin  to  recover  it.  As 
evidence  of  title  he  introduced  a  bill  of  sale 
from  Potts  to  him.  The  court  instructed  the 
jury  as  follows:  "It  is  the  claim  of  plaintiff 
that  at  the  time  when  the  property  was 
taken  he  was  the  owner  of  it;  that  he  had 
a  bill  of  sale  of  the  .same  from  Lewis  Potts, 
who  had  been  previously  the  owner  of  most 
of  the  property;  and  that  by  virvue  of  that 
he  was  entitled  to  possession.  The  defeUu 
ants,  on  the  other  hand,  claim  that  at  the 
time  of  the  commencement  of  this  suit  the 
property  in  question  was  owned  by  Lewis 
Potts,  and  in  his  possession,  and  not  the 
property  of  plaintiff,  or  in  the  possession  of 
plaintiff'.  It  appears  that,  at  the  time  the 
property  was  taken  by  Mr.  Finn  and  the 
other  defendants,  it  was  here,  in  the  city  of 
Port  Huron,  situate  in  a  barn;  and  it  is 
the  claim  of  plaintiff  that  at  that  time  it 
was  in  his  possession;  that  he  had  it  in 
his  possession,  and  under  his  bill  of  sale. 
The  defendants  claim  that  as  a  matter  of 
fact  it  was  not  in  his  possession,  Ijut  was  at 
the  time  the  propertj'  of  Mr.  Potts,  and 
was  in  the  possession  of  Mr.  Potts;  that  the 
plaintiff  was  Mr.  Potts'  hii'ed  man,  and  was 
taking  charge  of  the  horse,  as  usual.— as  he 
had  before  he  claims  to  have  bought  it,— and 
as  usual  for  a  man  in  his  situation  to  be 
taking  care  of  it.  Now,  in  regard  to  the 
question  of  fact,  as  to  the  ownership  and  ac- 
tual possession,  and  right  of  possession,  of 
this  property,  it  is  for  you  to  determine, 
from  aU  the  facts  and  circumstances  of  the 
case.  The  claim  of  defendant,  you  will  un- 
derstand, is  that  the  transaction  betwe>en 
Potts  and  Gray  was  simply  a  pretense;  that 


it  was  a  bill  pretending  sale,  for  the  pur- 
pose of  having  it  said  that  the  property  be- 
longed to  Mr.  Gray,  in  order  that  Mr.  Potts 
might  avoid  tlu'  payment  of  his  taxes.  On 
the  contrary,  Mr.  (iray  claims  it  was  an 
actual  transfer  to  him,  in  gooil  faith.  Now, 
as  to  whether  it  was  a  m.-re  pretense  is  a 
matter  for  you  to  determine  from  all  the 
facts  and  circumstances  in  the  case.  You 
should  consider  all  the  testimony  that  has 
been  given  in, view  of  the  transaction,  in 
the  light  of  the  circumstances,  and  satisfy 
youi*self,  as  ordinary,  unbiased  men,  what 
the  truth  is  in  that  regard;  and  if  the  prop- 
erty is  not  the  property  of  Mr.  Gray,  and 
was  not  in  the  po.ssession  of  Mr.  Gray,  at 
the  time  it  was  taken,  then  the  defendants 
would  be  entitled  to  a  vei'diet  in  this  case." 
The  court  further  instructed  the  jurj-  that  if 
they  found  that  plaintiff  was  the  owner  of 
the  property,  and  entitled  to  the  po.ssession, 
their  verdict  rhould  be  for  the  plaintiff,  but 
if  they  found  that  he  was  not  the  owner, 
and  not  entitled  to  the  possession,  but  that 
Mr.  Potts  Avas  owner  and  in  possession  at 
the  time  the  property  was  seized  by  the  de- 
fendant, then  their  verdict  should  be  for  the 
defendant. 

Under  the  evidence  and  the  charge  of  the 
court,  the  jui-y  settled  the  following  facts: 
(1)  That  the  title  and  possession  were  in  Mr. 
I'otts;  (2)  that  the  pretended  biU  of  sale 
was  given  with  no  intention  to  pass  either 
title  or  jxtssession  to  plaintiff,  but  that  it 
was  given  for  the  express  purpose  of  pre- 
venting a  levy  by  the  tax  collector.  There 
was  ample  evidence  to  sustain  the  verdict. 
Only  judgment  creditors  can  assail  a  trans- 
fer of  property  by  a  debtor  as  fraudulent. 
Jind  a  valid  judgment  is  necessary  to  enable 
the  creditor  to  make  the  attack.  Millar  v. 
Babcock,  29  Mich.  52G.  But  we  do  not 
think  this  rule  obtains  where  the  person 
against  whom  a  tax  is  assessed  makes  a 
pretended  sale  of  the  property  for  the  ex- 
prK?ss  purpose  of  preventing  a  levy,  retains 
possession  of  it,  receives  no  consideration, 
and  the  pretended  vendee  participates  in  the 
fraud,  and  takes  the  bill  of  sale,  in  order  to 
assist  in  defeating  the  collection  of  the  tax. 
Such  party  stands  in  no  better  position  than 
his  pretended  veur.or  to  contest  the  valid- 
ity of  the  tax.  Otherwise  the  statute  (How. 
St.  §  831S)  which  prohibits  replevin  for 
property  seized  by  virtue  of  a  tax  warrant 
could  be  very  readily  evaded.  The  question 
as  to  the  validity  of  the  tax  warrant  there- 
fore becomes  immaterial.  Judgment  af- 
firmed.   The  other  justices  concurred. 


286 


CONVEYANCE  AND  ASSIGNMENT   FOR  BENEFIT  OF  CREDITORS. 


WEBBER  V.  JACKkSON  et  al. 

(44  N.  W.  591,  79  Mich.  175.) 

Sui)n'in('  Court  of  Michigan.      .Tan.  17,  1890. 

Appeal  from  circuit  court,  Saf;ina\v  coun- 
ty ;  C.  II.  (lajvc,  Judge. 

S.G.  Hig«ins,  (Wisiior  &  Draper,  of  coun- 
sel,) for  appellant.  Wiiliani  H.  Sweet,  for 
appellees. 

CAMPBELL.,!.  C()mi)lainant  filed  a  juilir- 
nieiit  creditor's  bill  in  aid  of  execution,  and 
to  leach  equitable  assets.  On  the  2Gth  of 
September,  1SS4,  he  recovered  a  judgment 
in  a  suit  upon  a  former  judgment  indebt- 
ednes.s  against  Andrew  E.  Jackson  for  be- 
tween seven  and  eight  thousand  dollars. 
In  .\i)ril.  1.SS4,  while  this  suit  was  pending, 
it  is  claimed  by  defendant  Timothy  \V. 
Jackson  that  he  bought  in  good  faith,  and 
for  a  conii)lete  valuable  consideration,  a 
considerable  amount  of  real  estate  in  Sag- 
inaw county  from  his  brother  Andrew,  be- 
ing the  land  levied  on  by  complainant; 
the  consideration  being  .fG, 7:^7. 74  of  past 
indebtedness  given  up. 

The  validity  of  this  alleged  arrangement 
is  the  only  important  question  befoie  us. 
If  that  was  valid,  there  seems  to  be 
nothing  else  to  get  at  as  ecjuitable  assets 
or  personalty.  If  it  was  not  valid,  its  re- 
scission involves  the  subsequent  dealings 
in  I'egard  to  rents,  and  other  incidental 
profits  and  property,  based  on  the  owner- 
ship of  the  land.  "I'he  defendant  Andrew 
E.  Jackson,  instead  of  answering  the  bill 
seriously,  filed  a  so-called  "  answer  ''  which 
is  full  of  impertinence,  in  the  popular  as 
well  as  the  legal  sense  of  that  word,  which 
deserves  censure.  As  no  answer  under 
oath  was  asked ,  it  amounts  to  nothing, 
except  so  far  as  it  professes  to  show  the 
nature  of  the  ti-ansfer  to  Timothy  ;  and  in 
this  it  is  not  clear.  Timothy,  who  is  the 
defendant  chiefly  interested,  ostensibly 
claimed  to  be  a  bona  fide  i)urchaser  for 
valuable  consideration.  His  answer 
amounted  to  no  more  than  an  assertion  of 
the  fact,  without  explanation.  But,  in- 
stead of  averring  the  fact  that  tliere  was  a 
conveyance,  and  that  it  was  for  value,  he 
contents  himself  with  saying  tliat  the  con- 
veyances, "if  any  were  inade  by  said  de- 
fendant Andrew  E.Jackson  to  this  defend- 
ant, were  made  in  good  faith,  and  for  a 
valuable  consideration."  Such  an  answer 
is  not  only  without  point,  but  it  asserts 
nt)  rights  whatever  in  defendant,  and  is  a 
circumstance  of  some  meaning.  Complain- 
ant put  Andrew  on  the  stand,  and  in  a 
long  examination,  in  which  direct  and 
cross-examination  alternate  fretpiently, 
the  defense  is,  rather  shadowed  out  than 
plainly  swoi-n  to,  that  in  Ajuil,  ]ns4,  An- 
drew went  to  the  state  of  New  York,  at 
Timothy's  re(]urst,and  had  an  accounting 
with  'I'imothy.  and  arrived  at  a  balance 
due  of  the  sum  stated.  It  is  not  suggest- 
ed or  shown  that  Andrew  had  any  coun- 
ter-claims. The  amount  of  debt  is  said  to 
have  been  figured  uj)  by  adding  together 
sevei-al  notes  and  express  receiijts,  which 
are  proiluced  and  identified  by  .\iuirew, 
but  not  by  Timothy,  who,  however,  says 


the  amount  named  in  the  deed  was  due  for 
loans.  None  of  those  items  accrued  within 
the  period  of  limitation,  except  one.  All 
the  items  of  notes  were,  with  that  excep- 
tion, dated  in  1874,1875,  and  1S7G,  and  pay- 
able at  from  10  to  30  days,  except  one,  of 
December  5,  1874,  for  $1.30,  at  six  months. 
Among  these  ntjtes  was  one  30-day  note,  of 
$8,477.17.  None  of  them  had  any  place  of 
paynu'ut.  In  each  of  them  the  word  "or- 
der" had  been  changed  to  "  bearer,"  which 
is  a  very  uncommon  thing  in  such  busi- 
ness. ]\Iost  of  them  had  no  appearance  of 
handling.  All  were  on  the  same  printed  or 
lithographed  form,  got  up  some  years  be- 
fore, in  the  days  of  revenue  stami)s;  and 
most  of  them  had  the  left-head  ornamental 
portion  torn  off.  wholly  or  partially. 
There  is  no  explanation  why  they,  or  some 
of  them,  had  never  been  demanded  or  dis- 
cussed during  their  legal  life.  There  was 
no  attempt  to  show  that  any  of  these 
notes  represented  any  particular  money  or 
other  transaction.  None  of  them  was 
identified  by  Timothy;  but  he  did  swear 
that  all  of  the  notes  and  otherevidences  of 
debt  were  surrendered  to  Andrew  in  the 
spring  of  18s4.  when  in  New  York,  and  that 
the  settlement  was  then  completed, — which 
is  not  true,  literally,  at  least.  In  this  con- 
nection it  maybenoted  that  while,  accord- 
ing to  both  parties,  the  settlement  Avas 
the  result  of  urgency  from  Timothy,  which 
seems  to  have  been  a  single  instance  of  so- 
licitude after  many  years  of  quiet,  and 
both  say  it  was  comi)Ieted,  no  writing 
was  made  on  either  side,  and  no  haste 
was  shown  in  conveying.  A  paper  is  pro- 
duced, purporting  to  be  a  letter  fi'om  Tim- 
othy to  .\ndrew,  dated  May  10,  1884,  and 
within  two  weeksof  the  alleged  statement, 
as  follows:  "Mr.  A.  E.Jackson — Sir-  As 
you  have  executed  the  deed  of  jtroperty  tt> 
me  as  you  said  you  would  when  here,  now 
see  if  you  can  find  any  one  to  lend  monev 
and  fill  out  mortgage,  and  send  to  me.  and 
I  will  execute  it,  and  return.  I  want  .$!,- 
L'OO  or  .$1,500  dollars,  five  or  ten  years. 
Tim  W.  J.acksox."  Timothy  does  not  re- 
fer to  this  in  his  testimony.  Andrew,  tic- 
cording  to  his  testimony,  never  wrote  him 
on  business  after  his  return  to  Michigan^ 
No  attempt  seems  to  have  been  made  tc 
borrow  money,  and  ncithing  more  wa.s 
said  by  any  one  concerning  this  matter. 
The  testimony  shows  both  defendants  ta 
be  intelligent  men,  of  some  business  expe- 
rience. At  this  time  the  deed  was  not 
made.  Andrew,  at  some  time  or  other, 
dresv  it  up  himself.  He  did  not  got  his 
wife  to  execute  it.  It  was  dated  Ai)ril  28. 
1884,  but  was  not  witnessed  or  acknowl- 
edged until  June  I'od,  when  it  was  record- 
ed. It  was  never  sent  or  delivered  to  Tim- 
othy :  and  it  does  not  appear  whether  he 
hearu  of  it  at  all  beforesuit.  Andrew  con- 
tinued to  use  the  property,  and  receive  its 
returns,  under  what  he  claims  to  have 
been  an  agreement  with  Timothy  to  do  so 
on  shares.  Timothy  says  nothing  of  any 
such  agreement,  never  received  a  cent  of 
the  procee<ls,  and  never  asked  for  it,  and 
heard  nothing  from  Andrew  about  that, 
or  any  other  matter  which  related  to  his 
supposed  inter.'sts. 

It   is   claimed    by   counsel    that    because 
complainant   swore   Andrew  l.j   must    be 


CONVEYANCE  AND  ASSIGNMENT   FOR  BENEFIT  OF  CREDITORS. 


287 


considered  as  assertiiifr  liis  veracity.  No 
such  difficulty  exists  concerninjr  Timothy, 
wlio  utterly-  fails  to  throw  any  satisfac- 
tory li,s>ht  on  whatconcernshini  much  more 
tlian  it  concerns  Andrew.  But  it  seems  a 
little  incongruous  to  claim  that  a  pai'ty 
who  puts  a  defendant  on  the  stand  for  the 
express  purpose  of  showing  hisfraud  there- 
by gives  him  credit  for  honesty.  Tliissame 
claim  was  set  up  in  Roberts  v.  Miles.  12 
-Mich.  2;>7,  where  it  was  lield  by  this  court 
that,  whatever  risks  may  be  run  in  doing 
so,  the  testimony  is  to  be  judged  accord- 
ing to  its  merits,  and  creates  no  estoppel. 
We  have  no  disposition  to  go  into  con- 
jectures concerning  the  real  character  or 
origin  of  some  of  the  very  suspiciou.s  doc- 
uments before  us;  but  a  review  of  the 
whole  record  convinces  us  that  this  trans- 
action was  not  only  meant  to  avoid  pay- 
ment of  a  claim  which  had  no  defense,  but 
that  there  Avas  no  genuine  sale  at  all.  All 
of  the  circumstances  indicate  that  it  was  a 
sham  throughout,  and  that  Timothy's 
name  is  used  to  hold  what  has  never  been 
anything  but  Andrew's  property.  The 
testimony  is  evasive,  and  too  vague  to  ex- 
plain what  needed  explanation,  and  what 
both  parties— Timothy  as  well  as  Andrew 


— must  have  been  able  to  explain.  While 
fraud  is  not  to  be  assumed  without  proof, 
it  is  nevertheless  oftener  shown  by  circum- 
stances than  iji  any  other  way.  When 
things  appear  that  ai-e  contrary  to  the  or- 
dinary ways  of  honest  business  men,  and 
call  for  explanations  which  might  be,  but 
are  not,  given,  it  is  no  violent  inference  to 
conclude  that  there  is  something  wrong. 
And  where  this  (occurs  repeatedly,  and  is 
the  general  characteristic  of  the  conduct 
and  statements  of  the  pai-ties,  it  is  their 
own  fault  if  they  are  held  to  the  conse- 
quences. 

We  think  that  the  conveyance  to  Timo- 
thy should  be  declared  void  as  against 
compainant's  levy  and  judgment,  and  that 
all  the  ))roceeds,  so  far  as  thej'  can  be 
reached,  and  all  the  dealings  connected 
with  the  land,  must  be  regarded  as  belong- 
ing to  Andrew.  The  c(»mplainant  is  enti- 
tled to  a  receiver,  if  hechcjosesto  haveone, 
and  to  have  the  usual  assignment  to  iiim 
under  the  practice  in  judgment  creditors' 
bills,  and  to  pursue  the  usual  remedies  in 
such  cases.  He  is  entitled  to  a  reversal  of 
the  decree  below.  withcost>»of  both  courts, 
and  to  enter  a  decree  in  accordance  with 
these  views.     The  other  justices  concurred  .^ 


288 


ILLEGAL  SALES. 


GAMES  et  al.  v.  SUTHERLAND'S  ESTATE. 
(59  N.  W.  G52,  101  Mich.  355.) 

Snin-cmc  Court  of  Mic-liisan.      July  5,  1S94. 

Case  made  from  circuit  com-t,  Bonzie  coun- 
ty;   Fred  H.  Aldrlcli,  Judjre. 

Action  by  Josepli  Gambs  and  Cliarles  Dan- 
iels asainst  the  estate  of  Charles  H.  Suther- 
land, deceased.  From  a  judgment  for  plain- 
tiffs,  defendant  appeals.     Affirmed. 

Manly  C.  Dodge,  for  appellant.  D.  G.  F. 
^^'arner,  for  appellees. 

MONTGOMERY,  J.  This  is  a  claim  filed 
against  the  estate  of  Charles  H.  Sutherland 
for  beer  claimed  to  have  been  furnished  to 
Sutherland  in  his  lifetime.  It  appears  from 
the  case  made  that,  for  several  years  prior 
to  the  year  1S8S,  Charles  H.  Sutherland  had 
carried  on  a  saloon  business  in  the  village  of 
Frankfort,  in  his  own  name;  that  for  some 
time  prior  to  June,  1SS8,  his  brother,  George 
Sutherland,  had  been  employeil  by  him  in  the 
business;  that  in  that  month  Charles  and 
Geoi-ge,  in  order  to  enable  Charles  to  furnish 
the  liquor  bond  required  by  law,  made  an  ar- 
rangement by  which  the  saloon  business 
should  be  carried  on  in  the  year  ISSS  in  the 
name  of  George  Sutherland.  To  carry  out 
this  arrangement,  Charles  executed  and  con- 
veyed to  George  a  bill  of  sale  of  the  saloon 
outfit,  excepting  the  liquors.  An  inventory 
was  taken,  the  tax  was  paid  by  George  Suth- 
erland, and  a  bond  in  the  sum  of  $3,(X)0  was 
given  and  approved,  George  Sutherland  ap- 
pearing as  principal,  and  Charles  as  surety. 
George  continued  to  work  in  the  saloon,  as 
bartender,  for  $2  a  day  and  his  house  rent. 
The  business  continued  to  belong  to  Charles, 
and  he  furnished  all  the  capital,  and  received 
all  the  profits  of  the  business.  Charles  kept 
the  books  of  account,  wrote  all  the  letters  re- 
lating to  the  business,  looked  after  the  busi- 
ness generally,  but  everything  was  done  in 
the  name  of  George.  George  did  nothing 
in  the  business,  except  waiting  on  customers. 
The  plaintiffs  sold  beer,  which  was  shipped 
to  "Sutherland,"  and  knew  of  the  fact  that 
the  business  was  being  conducted  in  George's 
name,  and  also  that  the  business  was  in  fact 


that  of  Charles  Sutherland.     Under  the  cir- 
cumstances, it  cannot  be  doubted  that  Charles 
Siitherland,  who  was  the  actual  owner  of  the 
business,  and  who  had  the  property  and  tlit 
proceeds  of  it,  is  in  law  liable  to  pay  for  the 
goods,  unless  the  claimants  have  been  con- 
nected with  an  illegal  transaction,  in  such  a 
way    as    to   preclude   recovery    by    them,    on 
grounds  of  public  policy.     Does  the  evasion 
of  some  of  the  terms  of  the  liquor  law  (see 
sections  1,  4,  and  8  of  the  act,  3  How.  Ann. 
St.    p.    3181    et   seq.)    constitute    an   offense, 
under  the  facts  foiuid  in  the  present  case? 
We  think  not.     The  date  when  the  plaintiffs 
or  their  agent  learned  that  the  business  was 
being  conducted  in  the  name  of  George  Suth- 
erland, while  it  was  in  fact  that  of  Charles 
Sutherland,    is    not    definitely    fixed,    nor    is 
there  any  affirmative  finding  that  the  plain- 
tiffs did   any  act  with   the   purpose   of  aid- 
ing  in   the   evasion   of   the    law.     The   case 
comes  within  the  ruling  in  Webber  v.  Don- 
nelly, 33  Mich.  4G9,  where  it  was  held  that 
mere  knowledge  on  the  part  of  the  vendor 
that  the  vendee  of  the  goods  is  engaged  in 
illegal  business  will  not  prevent  a  recovery  of 
the  value  of  the  property,  if  there  be  no  act 
done  by  the  vendor  in  futherance  of  the  at- 
tempted illegal  transaction.     It  may  perhaps 
be  admitted  that  there  are  circumstances  in 
the    pi'esent   case   from    which    an    inference 
might    be    drawn    that    the    claimants    were 
guilty  of  some  participation  in   the  attempt 
to  defeat  the  statute,  but  we  cannot  draw  in- 
ferences of  fact  from  the  testimony,  for  the 
purpose   of   establishing    error.     The    proper 
practice  would   have  been  to  have  had   th(> 
findings    cover   the   point,   or,    if   the   circuit 
judge  refused  to  find  in  accordance  with  the 
testimony,  to  have  excepted  to  such  refusal, 
and    thus    have    raised    the    question    as    to 
whether  the  evidence  called  for  a  finding  or 
facts  in  aceoixlance  with  the  claim  of  the  de- 
fendant.    Unless  we  go  outside  of  the  find- 
ing, and  draw  inferences  fi-om  circumstances, 
which  might  or  might  not  be  justified,  error 
does    not    affirmatively    appear.     The    judg- 
ment will  be  affirmed,  with  costs. 

LONG,  J.,  did  not  sit.     The  other  justices 
concurred. 


ILLEGAL  SALES. 


289 


GRAVES  et  al.   v.   JOHNSON. 

(30  N.  E.  818,  15()  Mass.  211.) 

"Supreme  Judicial  Court  of   Massacliusetts. 
Suffolk.    May  6,  18!»2. 

Exceptions  from  superior  cmirr.  Suttolli 
•county;  Robert  R.  Bishop,  Judge. 

Action  by  Chester  H.  Graves  and  others 
iigaiust  Walter  B.  Johnson  for  the  price  of 
liquors  sold  to  defendant  by  plaintiffs.  Judg- 
ment for  plaintiffs,  and  defendant  excepts. 
Exceptions  sustained. 

A.  J.  Pratt,  for  plaintiffs.  C.  C.  Powers, 
for  defendant. 


HOLMES,  J.  This  is  an  action  for  the 
price  of  intoxicating  liquors.  It  is  found  that 
they  were  sold  and  delivered  in  Massachu- 
setts by  the  plaintiffs  to  the  defendant,  a 
Maine  hotel  keeper,  with  a  view  to  their  be- 
ing resold  by  the  defendant  in  Maine  against 
the  laws  of  that  state.  These  are  all  the  ma- 
terial facts  reported,  but  these  findings  we 
must  assume  were  warranted,  as  the  evi- 
-dence  is  not  reported,  so  that  no  question  of 
the  power  of  Maine  to  prohibit  the  sales  is 
open.  The  only  question  is  whether  tlie  facts 
as  stated  show  a  bar  to  this  action. 

"J'he  question  is  to  be  decided  on  principles 
Avhich  we  presume  would  prevail  generally 
in  the  administration  of  the  common  law  in 
this  country.  Not  only  should  it  be  decided  in 
the  same  way  in  which  we  should  expect  a 
Maine  court  to  decide  upon  a  Maine  contract 
presenting  a  similar  question,  but  it  should 
be  decided  as  we  think  that  a  Maine  court 
ought  to  decide  this  very  case  if  the  action 
were  brought  there.  It  is  noticeable,  and  it 
has  been  observed  by  Mr.  Pollock,  that  some 
•  of  the  English  cases  which  have  gone  fur- 
the.st  in  asserting  the  right  to  disregard  the 
.revenue  laws  of  a  country  other  than  that 
where  the  contract  is  made  and  is  to  be  per- 
formed, have  had  reference  to  the  English 
revenue  laws.  Holman  v.  Johnson.  1  Cowp. 
341;  Poll.  Cont.  (5th  Ed.)  308.  See,  also,  Mc- 
Intyre  v.  Parks,  3  Mete.  (Mass.)  207. 

The  assertion  of  that  right,  however,  no 
•doubt  was  in  the  interest  of  I<]nglish  com- 
merce (Pellecat  v.  Angell,  2  Cromp.  M.  & 
R.  311,  313)  and  has  not  escaped  criticism 
(Story,  Contl.  Laws,  §§  25i,  257,  note;  3 
Kent,  Conmi.  205,  2(j6;  Whart.  Confi.  Laws, 
§  484),  although  there  may  be  a  question  how 
far  the  actual  decisions  go  beyond  what 
would  iiave  toeen  held  in  the  case  of  an  Eng- 
lish contract  affecting  only  English  laws  (see 
Hodgson  V.  Temple.  5  Taunt.  181;  Brown  v. 
Duncan,  10  Bam.  cVt  C.  93,  95.  !)8;  Harris  v. 
Runuek;,  12  How.  79,  83,  84). 

Of  course  it  would  be  possible  for  an  in- 
■dependent  state  to  enforce  all  contracts  made 
.and  to  be  performed  witliin  it  without  regard 
to  how  much  they  might  contravene  the  pol- 
icy of  its  neighbors"  laws.  But  in  fact  no 
state  pursues  such  a  course  of  barbarous  iso- 
lation.    As  a  general  proposition,  it  is  admit- 

V.-VN  ZILl'^  SEL.CAS.S.\LES— 19 


ted  that  an  agreement  to  break  the  laws  of 
a  foreign  country  would  be  invalid.  Poll. 
Cont.  (5th  Ed.)  308.  The  courts  are  agreed 
on  the  invalidity  of  a  sale  when  the  contract 
contemplates  a  design  on  the  part  of  the  pur- 
chaser to  resell  contrary  to  the  laws  of  a 
neighboring  state,  and  requires  an  act  on  the 
part  of  the  seller  in  furtherance  of  the 
scheme.  Waymell  v.  Reed,  5  Term  R.  599; 
Gaylord  v.  Soragen,  32  Vt.  110;  Fisher  v. 
Lord,  03  N.  H.  514,  3  Atl.  927;  Hull  v.  Rug- 
gles,  50  N.  Y.  424,  429. 

On  the  other  hand,  plainly  it  would  not 
be  enough  to  prevent  a  recovery  of  the  price 
that  the  seller  had  reason  to  believe  that  the 
buyer  intended  to  resell  the  goods  in  viola- 
tion of  law.  He  must  have  known  the  inten- 
tion in  fact.  Finch  v.  Manstield,  97  Mass. 
89,  92;  Adams  v.  Coulliard,  102  Mass.  107, 
173.  As  in  the  case  of  torts,  a  man  has  a 
right  to  expect  lawful  conduct  from  others. 
In  order  to  charge  him  with  the  conse- 
quences of  the  act  of  an  intervening  wrong- 
doer, you  must  show  that  he  actually  con- 
templated the  act.  Hayes  v.  Hyde  Park,  153 
Mass.  514-510,  27  N.  E.  522. 

Between  these  two  extremes  a  line  is  to 
be  drawn.  But  as  the  point  where  it  should 
fall  is  to  be  determined  by  the  intimacj'  of 
the  connection  between  the  bargain  and  the 
breach  of  the  law  in  the  particular  case,  the 
bargain  having  no  general  and  necessary  tend- 
ency to  induce  such  a  breach,  it  is  not  sur- 
prising that  courts  should  have  drawn  the 
line  in  slightly  different  places.  It  has  been 
thought  not  enough  to  invalidate  a  sale  that 
the  seller  merely  knows  that  the  buyer  in- 
tends to  resell  in  violation  even  of  the  domes- 
tic law.  Tracy  v.  Talmage,  14  N.  Y.  102; 
Hodgson  V.  Temple,  5  Taunt.  181.  So  of  the 
law  of  another  state.  Mclntyre  v.  Parks,  3 
Mete.  (Mass.)  207;  Sortwell  v.  Hughes.  1 
Curt.  244,  Fed.  Cas.  No.  13.177;  Green  v. 
Collins,  3  Cliff.  494,  Fed.  Cas.  No.  5,755; 
Hill  V.  Spear,  50  N.  H.  253.  Dater  v.  Earl,  3 
Gray,  482,  is  a  decision  on  New  York  law. 

But  there  are  strong  intimations  in  the 
later  Massachusetts  cases  that  the  law  on 
the  last  point  is  the  other  way  (Suit  v.  Wood- 
hall,  113  Mass.  391,  395;  Finch  v.  Manstield,  97 
Mass.  89,  92);  and  the  English  decisions  have 
gone  great  lengths  in  the  case  of  knowledge 
of  intent  to  break  the  domestic  law.  Pearce 
V.  Brooks,  L.  R.  1  Exch.  213;  Taylor  v. 
Chester,  L.  R.  4  Q.  B.  309,  311. 

However  this  may  be,  it  is  decided  that 
when  a  sale  of  intoxicating  liquor  in  an- 
other state  has  just  so  much  greater  prox- 
imity to  a  breach  of  the  Massachusetts  law 
as  is  implied  in  the  statement  that  it  was 
made  with  a  view  to  such  a  breach,  it  is 
void.  Webster  v.  iSIunger,  8  Gray,  584;  Or- 
cutt  V.  Nelson,  1  Gray,  530.  541;  Hubbell  v. 
F14nt,  13  Gray,  277,  279;  Adams  v.  Coulliard. 
102  Mass.  107,  172,  173.  Even  in  Green  v. 
CoHins  and  Hill  v.  Spear,  the  decision  in 
Webster  v.  Muuger,  seems  to  be  approvetl. 
See,  also,  Langton  v.  Hughes,  1  Maule  &  S. 


290 


ILLEGAL  SALES. 


593;  M'Kinnell  v.  Robiuson,  3  Mees.  ^  W. 
434,  441;  White  v.  Buss,  3  Cnsb.  448.  If  the 
'sale  would  not  have  been  made  but  for  the 
seller's  desire  to  induce  an  unlawful  sale  in 
Maine,  it  Avuuld  be  an  unlawful  sale,  on  the 
principles  explained  in  Hayes  v.  Hyde  Park, 
l.-)3  Mass.  514,  27  N.  E.  522,  and  Tasker  v. 
Stanley,  153  Mass.  148,  26  N.  E.  417.  The 
overt  act  of  selling,  which  otherwise  would 
be  too  remote  from  the  apprehended  result, 
—an  unlawful  sale  by  some  one  else,— would 
be  connected  with  it,  and  taken  out  of  the 
protection  of  the  law  by  the  fact  that  that 
lesult  was  actually  intended.  We  do  not  un- 
'derstaud  the  .iudge  to  have  gone  so  far  as  we 
have  just  supposed.  We  assume  that  the 
sale  would  have  taken  place  whatever  the 
buyer  had  been  expected  to  do  with  the 
goods.  But  we  understand  the  judge  to 
have  found  that  the  seller  expected  and  de- 
sired the  buyer  to  sell  unlawfully  in  Maine, 
and  intended  to  facilitate  his  doing  so.  and 
that  he  was  known  by  the  buyer  to  have  that 
intent.  The  question  is  whether  the  sale  is 
saved  by  the  fact  that  the  intent  mentioned 
was  not  the  controlling  inducement  to  it. 
As  the  connection  between  the  act  in  ques- 
tion, the  sale  here,  and  the  illegal  result,  the 
.sale  in  Maine,— its  tendency  to  produce  it, — 
is  only  through  the  later  action  of  another 
man,  the  degree  of  connection  or  tendency 
may  vary  by  delicate  shades.  If  the  buyer 
knows  that  the  sale  is  made  only  for  the 
purpose  of  facilitating  his  illegal  conduct,  the 
connection  is  at  the  strongest.  If  the  sale  is 
made  with  the  desire  to  help  him  to  his  end. 
although  primarily  made  for  money,  the  sell- 
er cannot  complain  if  the  illegal  conse- 
quence  is  attributed   to   him.     If  the   buyer 


knows  that  the  seller,  while  aware  of  his  in- 
tent, is  iudifierent  to  it  or  disapproves  of  it. 
it  maj'  be  doubtful  whether  the  connection 
is  sutticient.  Compare  Com.  v.  Churchill,  lo(j 
Mass.  148,  150.  It  appears  to  us  not  unrea- 
sonable to  draw  the  line  as  it  was  drawn  in 
Webster  v.  Munger,  and  to  say  that  when 
the  illegal  intent  of  the  buyer  is  not  only 
known  to  the  seller,  but  encouraged  by  the 
sale  as  just  explained,  the  sale  is  void.  The 
accomplice  is  none  the  less  an  accomplice 
that  he  is  paid  for  his  act.  See  Com.  v.  Har- 
rington, 3  rick.  2ti. 

The  ground  of  the  decision  in  Webster  v. 
Munger  is  that  contracts  like  the  present  are 
void.  If  the  contract  had  been  valid,  it 
would  have  been  enforced.  Dater  v.  Earl.  3 
Gray,  482.  As  we  have  said  or  implied  al- 
ready, no  distinction  can  be  admitted  based 
on  the  fact  that  the  law  to  be  violated  in  that 
case  was  the  lex  fori.  For  if  such  a  distinc- 
tion is  ever  sound,  and  again  if  the  same 
principles  are  not  always  to  be  applied  wheth- 
er the  law  to  be  violated  is  that  of  the  state 
of  the  contract  or  of  another  (see  Tracy  v. 
Talmage,  14  N.  Y.  102,  213),  at  least  the  right 
to  contract  with  a  view  to  a  breach  of  the 
laws  of  another  state  of  this  Union  ought 
not  to  be  recognized  as  against  a  statute 
passed  to  carry  out  fimda mental  beliefs  about 
right  and  wrong  shared  by  a  large  part  of  our 
own  citizens.  Territt  v.  Bartlett,  21  Vt.  184, 
188,  189.  In  the  opinion  of  a  majority  of  the 
court,  this  case  is  governed  by  W^ebster  v. 
Munger,  and  we  believe  that  it  would  have 
been  decided  as  we  decide  it  if  the  action  had 
been  brought  in  Maine  instead  of  here. 
Banchor  v.  Mansel,  47  Me.  58. 

Exceptions  sustained. 


ILLEGAL  SALES. 


291 


GIBBS   V.   CONSOLIDATED    GAS   CO.    OF 
BALTIMORE. 

(9  Slip.  Ct.  553,  130  U.  S.  39G.) 

Suprome  Court  of  the  United  State.s.      April  15, 
1S89. 

In  Eiror  to  the  Circuit  Court  of  tlie  United 
States  for  the  District  of  Maryljind. 

riaintiff  in  error  brouglit  this  action  in  the 
circuit  court  of  tlie  United  States  for  the  dis- 
trict of  Maryland  against  the  defendant  in 
error,  "a  corporation  duly  incorporated  un- 
der the  laws  of  Maryland,  for  money  pay- 
able by  the  defendant  to  the  plaintiff,"  as 
stated  in  the  "bill  of  particulars  of  plaintiff's 
claim,"  "for  services  rendered  by  me  at  your 
request  in  negotiating  and  consummating  an 
arrangement  and  settlement  of  differences 
between  the  Consolidated  Gas  Co.  of  Baito. 
City  and  the  Equitable  Gas-Light  Co.  of 
Balto.  City,  between  .Inly  1,  18S4,  and  No- 
vember 1,'  1884,  $50,000;"  and  a  trial  was 
had  upon  the  general  issue  {)leaded,  resulting 
in  verdict  and  judgment  for  the  defendant, 
May  14,  188.5.  From  the  bill  of  exceptions 
it  appears  that — 

"At  the  trial  of  this  case,  the  incorpora- 
tion of  the  defendant  being  admitted,  the 
plaintiff,  to  maintain  the  issues  upon  his  part 
joined,  gave  in  evidence  tlie  agreement  fol- 
lowing between  said  defendant  and  the  Equi- 
table Gas-Ligiit  Company  of  Baltimore  City, 
a  Maryland  corporation, — that  is  to  say: 

"  '  Agreement.  Tliis  agreement,  made  this 
seventh  day  of  October,  eigiiteen  hundred 
and  eiglity-four,  between  the  Equitable  Gas- 
Light  Company  of  JSaltimore  City,  a  corpora- 
tion duly  organized  under  the  laws  of  the 
state  of  Maryland,  party  of  the  first  part,  and 
the  Consolidated  Gas  Company  of  Baltimore 
City,  a  corporation  duly  organized  under  the 
laws  of  the  same  state,  party  of  tiie  second 
part.  Whereas,  the  parties  hereto  conduct 
the  business  of  making  and  selling  gas  in  the 
city  of  Baltimore,  Maryland,  and  for  some 
time  past  have  been  drawn  into  active  com- 
petition, resulting  in  a  loss  of  pronts  to  eacli 
company,  as  well  as  large  expens  s  and  great 
annoyance;  and  whert-as,  each  party  hereto 
desires  to  enter  into  an  arrangement  with  the 
otiier,  whereby  the  business  of  eacii  may  be 
conducted  in  a  more  prolitr.ble  manner  than 
at  present:  Now,  therefore,  in  considera- 
tion of  the  })remises,  and  of  the  mutuality 
hereof,  it  is  hereby  agreed  between  said  par- 
ties as  follows,  viz.: 

"  '  1.  Gas  shall  be  sold  by  each  company  at  a 
rate  of  one  dollar  and  seventy-tive  cents  per 
thousand  cubic  feet,  with  a  rebate  of  fifteen 
cents  a  thousand  feet  to  consumers  for  pay- 
ment within  seven  days  from  date  of  render- 
ing bill,  unless  the  rate  shall  be  changed  b\' 
mutual  agreement  of  the  parties  hereto  in 
writing;  but,  in  view  of  the  much  larger  in- 
tert  St  of  tlie  party  of  the  second  part  in  the 
subject-matter  of  this  contract,  it  is  agreed 
tliat  in  case  of  competition  on  the  part  of  any 
other  gas  company  the  said  party  of  the  sec- 
ond part  shall  have  the  right  at  its  discretion 


to  reduce  the  rate  at  which  gas  shall  be  sold 
by  either  or  both  of  the  parlies  hereto,  and 
siiall  have  the  right  at  its  discretion  to  lix 
and  change  said  price  at  wliich  gas  shall  be 
sold  by  either  or  both  of  the  parties  hereto, 
from  time  to  time,  so  long  as  such  competi- 
tion shall  continue:  provided,  that  said  price 
sliall  not  be  placed  at  less  than  one  dollar 
(.•SLOO)  per  thousand  feet  without  the  mutual 
consent  of  the  parties  hereto  in  writing. 
The  introduction  of  gas  from  the  street  main 
to  the  inside  of  the  building  to  be  ligiited 
will  in  all  cases  be  done  by  the  companies, 
for  which  tlie  proprietor  of  the  buil.ling  or 
the  person  applying  for  the  supply  of  gas 
will  be  required  to  pay  in  advance  the  sum 
of  eight  dollars,  (.'n^8.6o,)  to  cover  the  ex- 
penses of  tapping  main,  laying  service  pipe, 
setting  meter,  and  its  connection  to  the 
building  line.  An  extra  charge  will  be  made 
where  the  building  is  set  back  from  the  build- 
ing line. 

"  '  2.  P^ach  party  hereto  shall  deduct  from 
its  receipts  and  retain  the  sum  of  one  dollar 
for  every  thousand  feet  of  gas  sold  by  it  as  a 
basis  of  cost  to  cover  all  expenses  of  the  bus- 
iness of  each. 

"  *  3.  All  extensions  of  mains,  including 
services  and  meters  on  said  extensions,  and 
all  enlargement  of  tiie  capacity  of  the  works 
necessary  to  do  the  increasing  business  dur- 
ing tiie  continuance  of  this  agreement,  shall 
be  made  by  tiie  Consolidated  Gas  Company 
of  Baltimore  City,  at  its  own  cost  and  ex- 
pense, wliose  property  such  enlargements 
and  extensions  shall  be,  the  Equitable  Com- 
pany only  being  required  to  provide  the 
meters  and  services  necessary  to  supply  such 
additional  consumers  as  may  be  f urnislied  by 
it  under  section  5,  below. 

"'  4.  Division  of  receipts  shall  be  made  as 
follows,  viz.: 

"'(1)  All  receipts(over  and  above  the  sum 
of  one  dollar  per  thousand  feet,  allowed  as  a 
basis  of  cost)  from  gas  sold  each  year  upon 
sales  not  exceeding  the  total  quantity  of  gas 
sold  by  both  of  said  companies  during  the 
year  ending  October  first,  eighteen  hundred 
and  eiuiity-four,  shall  be  divided  between  the 
parties  hereto  in  the  following  proportions, 
viz.:  The  party  of  the  first  part  shall  re- 
ceive such  a  proportion  of  the  same  as  the 
amount  of  gas  sold  by  it  during  the  year  end- 
ing October  first,  eigiiteen  hundred  and 
eighty-four,  shall  bear  to  the  total  quantity 
of  gas  sold  by  both  of  tlie  parties  hereto  dur- 
ing that  period,  provided  the  quantity  sold 
by  the  party  hereto  of  the  first  part  during 
said  period  shall  not  exceed  two  hundred 
and  thirteen  millions  of  feet,  (21o.000,000,) 
and  the  party  of  the  second  part  shall  re- 
ceive all  the  balance,  after  dedu  ting  the 
amount  to  wiiicli  the  party  of  the  first  part 
shall  be  entitled,  as  above  provided,  it  being 
expressly  understood  and  agreed  that  the  ba- 
sis of  participation  in  said  receipts  shall  be 
the  proportion  which  the  quantity  of  gas 
sold  by  each  party  from  October  first,  eight- 
een  hundred    and   eighty-three,  to    October 


292 


ILLEGAL  SALES. 


first,  eighteen  hundred  and  eigliLy-loiir, 
bears  to  the  total  quantity  of  gas  sold  by 
both  parties  heretfo,  and  that  neither  party 
herr-to  shall  receive  more  thereof  than  by 
such  a  basis  of  division  it  would  be  entitled 
to.  subject,  however,  to  the  foregoing  pro- 
vision that  the  quantity  sold  i)y  tlie  party  of 
the  (irst  part  during  tiie  said  year  ending 
October  first,  eigliteen  hundred  and  eighty- 
four,  shall  not  be  considered  as  exceeding 
two  hundred  and  thirteen  millions  (213,000,- 
000)  of  feet  as  aforesaid. 

"•(2)  All  receipts  (over  and  above  the  said 
allowance  of  one  dollar  j)er  thousand  feet  as 
a  basis  of  costs)  from  gas  sold  each  year  up- 
on sales  in  excess  of  the  said  total  qunntity 
sold  during  the  year  ending  October  first, 
eighteen  hundred  and  eighty-four,  shall  be 
divided  as  follows,  viz.:  Tiie  party  of  the 
first  part  shall  receive  tiiereout  a  percentage 
equal  to  one-halt  of  the  percentage  which  it 
will  receive  as  aliove,  and  tiie  party  of  the 
second  part  sliall  receive  all  the  balance  of 
such  receipts  from  said  increased  sales. 

"*  5.  Neither  party  hereto  shall  solicit  any 
business  belonging  to  the  other,  but  either 
party  may  tai<e  such  consumers  of  the  other 
as  may  voluntarily,  without  any  solicitation, 
desire  to  ciiange  from  one  to  tiie  other. 

"'6.  All  the  accounts  lietvveen  the  parties 
hereto  hereunder  shall  be  adjusted  quarterly 
on  the  tenth  days  of  February,  May,  August. 
and  November  of  each  year  for  thequaiter 
ending  on  the  last  day  of  December,  March, 
June,  and  September,  and  settlements  of  all 
balances  shall  be  made  within  ten  days 
thereafter.  The  said  adjustment  of  accounts 
shall  be  made  by  an  auditor,  who  shall  be 
chosen  by  the  agreement  of  both  parties 
hereto. 

"'7.  If  any  differences  or  misunderstand- 
ing arise  hereunder,  the  matter  in  dispute 
shall  be  referred  for  decision  to  three  arbi- 
ters, whose  decision  shall  be  binding  upon 
the  parties  hereto,  so  far  as  in  law  it  may 
have  binding  force  and  effect.  Said  arbiters 
shall  be  chosen  as  follows,  viz.:  One  shall 
be  chosen  by  each  party  hereto,  and  the  third 
by  the  two  so  chosen:  provided,  that,  if 
either  party  hereto  neglects  or  refuses  for  ten 
days  after  request,  in  writing,  mailed  or  per- 
sonally delivered,  to  appoint  an  arbiter,  the 
party  making  such  request  shall  appoint  two 
''arbiters,  who  shall  appoint  a  third,  as  above 
provided. 

"'8.  It  is  further  understood  and  agreed 
that  if  either  party  hereto  shall  at  any  time 
willfully  fail,  omit,  or  neglect  to  perform,  or 
shall  violate  any  of  the  covenants  herein 
contained,  such  party  shall  be  liable  to  the 
other  for  all  loss  and  damage  caused  to  or 
sulfered  by  it  thereby,  and  that  the  damages 
which  shall  be  caused  thereby  will  be  equal 
to  the  sum  of  tvvo^  hundred  and  fifty  thou- 
sand dollars.  (§250*000,)  and  that  the  party 
who  shall  so  fail,  neglect,  or  omit  to  perform, 
or  who  shall  violate  any  of  the  covenants 
herein  contained,  shall  at  once  thereupon 
pay  to  the  other  party  the  sum  of  two  hun- 


[   dred  and  fifty  thousand  dollars  as  liquidated 

:  damages,  and  thut  upon  failure  to  pay  the 
same  upon  deniiind  suit  may  be  brought 
therefor,  in  which  the  damages  so  caused  or 
suffered  shall  be  assessed  at  said  sum  of  two 

;    hundred  and  fifty  thousand  dollars. 

"'9.  This  agreement  shall  take  effect  from 
October  fifteenth,  eighteen  hundred  and 
eighty-four,  and  siiall  continue  in  force  for 
thirty  years  from  its  date.' 

"[Duly  signed  and  sealed  October  7th, 
1884.] 

"The  plaintiff  then  proved  the  incorpoia- 

j   tion  of  the  United  (}as  Improvement  Com- 

I  pany,  a  corporation  incorporated  by  and  do- 
ing business  in  the  state  of  Pennsylvania. 
The  plaintiff  further  proved  that  at  the  time 

I  of  the  agreement  aforesaid  he  was  the  gen- 
ital manager  of  the  said  United  Gas  Im- 
provement Compaiiy,  and  the  business  of  the 

i  said  corporation  wis  the  owning,  improving, 
leasing,  ami  manipulation  of  gas  property 
throughout  the  country;  said  company  being 

j  the  owner  of  many  gas-works  in  various 
parts  of  the  Union,  and  constantly  in  nego- 
tiation for  the  sale  and  purchase  of  that  kind 
of  property.  He  further  j)roved  that,  by 
reason  of  tlie  rivair}  in  the  city  of  Baltimore 
between  the  defendant  and  the  Equitable 
Gas-Light  (."oinpany  aforesaid,  the  price  of 
gas  had  been  reduced  to  a  figure  below  that 
at  which  it  could  be  profitably  manufactured, 
and  that  the  company  of  which  the  plaintiff 
was  manager,  as  wfll  as  other  gas  compa- 
nies throughout  the  country,  had  been  ma- 

j   terially  inconvenienced  by  the  fact  that  they 

I  were  required  and  expected  by  their  custom- 
ers to  sell  their  gas  at  the  insufficient  price 
at  which  it  was  furnished  in  Baltimore.  It 
became,  therefore,  the  interest  of  tlie  plain- 
tiff and  his  company  that  the  conflict  in  Bal- 
timore should,  if  possible,  be  brought  to  an 
amicable  termination,  and  the  plaintiff  made 
a  suggestion  to  that  effect  to  the  president  of 
the  Equitable  Gas-Light  Company,  and  in 
consequence  thereof  was  employed  by  that 
company  to  bring  about  a  settlement,  if  pos- 
sible, with  the  defendant.  For  this  purpose 
the  plaintiff  visited  Baltimore,  and  opened 
negotiations  with  the  defendant,  which  were 
carried  on  for  some  time  by  proposition  and 
counter-proposition,  and  resulted,  finally,  in 
the  agreement  heretofore  inserted  in  this 
bill  of  exceptions. 

"The  plaintiff  gave  further  evidence  tend- 
ing to  show  that  early  in  those  negotiations 
he  informed  the  defendant,  through  the  com- 
mittee representing  it,  that  he  was  employed 
and  would  be  paid  by  the  Equitable  Gas- 
Light  Company  if  he  made  an  arrangement 
satisfactory  to  that  company,  and  that  if  he 
should  be  successful  in  bringing  about  a 
settlement  satisfactory  to  the  defendant  also, 
he  should  expect  and  claim  to  be  compensat- 
ed by  the  defendant  likewise.  Further  testi- 
mony in  respect  to  the  matter  of  his  said 
negotiations  and  services  and  his  claimed 
and  expected  compensation  from  the  defend- 
ant was  given  by  the  plaintiff  tending  to 


illp:(jal  sales. 


29'3 


support  and  establisli  the  hypotheses  of  fact 
set  lip  by  the  jihiintiff  in  those  regards  in  his 
prayers,  hereinafter  to  be  inserted. 

"The  defendant  then,  to  maintain  the  is- 
sues npon  its  part  joined,  gave  in  evidence 
the  acts  of  tlie  general  asseniblv  of  Maryland 
of  1867,  c.  132.  and  of  1882,  c."  337,  both  re- 
lating to  tlie  Eqnitable  Gas-Light  Company 
of  lialtimoie  Tily,  whicli  it  was  agreed  migiit 
be  read  in  evidence,  if  necessary,  from  the 
slatiite-book,  on  the  heaiing  in  error.  The 
defendant  further  eave  evidence  tending  to 
contradict  the  evidence  on  llie  part  of  the 
plaintiff  in  regard  to  what  occurred  between 
tlie  jilaintiff  and  the  defendant's  committee 
in  respect  to  the  negotiations  aforementioned, 
and  to  the  plaintiff's  alleged  demand  for  com- 
pensation from  the  defendant,  and  tending 
to  disprove  the  facts  assumed  as  the  hvputh- 
eses  of  the  plaintift''s  prayers;  and  th  •  de- 
fendant further  gave  evidence  tending  to  es- 
tablish and  maintain  tlie  iiypotlieses  of  fact 
set  up  by  the  defendant  in  its  prayers  to  the 
court,  hereinafter  to  be  inserted." 

Various  instructions  were  asked  on  behalf 
of  each  of  the  parties,  which  the  court  de- 
clined to  give,  but  at  defendant's  request  in- 
structed the  jury  "that  the  plaintiff',  upon 
the  pleadings  and  evidence  in  tliis  case,  is 
not  entitled  to  recover,  because  the  contract 
offered  in  evidence,  and  for  the  procuring  of 
the  making  whereof  he  claims  compensation 
in  tliis  suit,  was  illegal  and  void." 

S.  T.  Wallis,  for  plaintiff  in  error.  R.  I). 
Morrison  and  N.  P.  Bond,  for  defendant  in 
error. 

Mr.  Ciiief  Justice  FL'LLEll',  after  stating 
the  facts  as  above,  delivered  tlie  opinion  of 
the  court. 

Tlie  plaintiff  sought  to  recover  compensa- 
tion for  services  alleged  to  have  been  ren- 
dered by  him  to  the  defendant  in  securing 
the  contract  in  question  between  the  defend- 
ant and  the  Equitable  Gas-l>ight  Company 
of  Baltimore.  It  is  objected  that  the  court 
erred  in  giving  the  instruction  that  the  plain- 
tiff was  not  entitled  to  recover,  because  it 
assumed  a  material  fact  in  dispute,  which 
should  have  been  left  to  the  jury,  namely, 
that  it  was  "for  the  procuring  of  the  mak- 
ing" of  the  contract  offered  in  evidence  that 
compensation  was  claimed.  The  record  does 
not  show  that  this  objection  to  the  instruction 
was  taken  in  the  court  below,  nor  does  it  con- 
tain any  evidence  tending  to  establish  that 
the  plaintiff  claimed  compensation  for  any- 
thing else  than  for  services  in  bringing  about 
the  agreement.  Plaintift''s  bill  of  particulars 
is  for  services  "in  negotiating  and  consum- 
mating an  arrangement  and  settlement  of 
differences"  between  the  two  gas  companies; 
and  he  put  the  contract  in  evidence,  and  ad- 
duced proof  that  he  carried  on  negotiations, 
which  "resulted  finally"  in  the  execution  of 
it.  lie  was  general  manager  of  a  corpora- 
tion engaged  in  tlie  business  of  "tlie  owning, 
improvnig,  leasing,  and  manipulation  of  gas 


property  throughout  the  country,"  and,  as 
ills  company  and  oilier  gas  companies  "had 
been  mateiially  inconvenienced  by  the  fact 
that  tliey  were  required  and  expected  by  their 
customers  to  sell  their  gas  at  the  insufficient 
price  at  which  it  was  furnisiied  in  Balti- 
more, "  he  suggested  "that  the  conflict  in 
lialtimore  should,  if  possible,  be  brought  to 
an  amicable  termination,"  "and  in  conse- 
quence thereof"  was  employed  by  the  ?^qui- 
table  Gas-Light  Company  "to  bring  about  a 
settlement,  if  possible,  with  the  defendant." 
The  conllict  referreil  to  seems  to  have  been 
the  comjietition  in  the  in.iking  and  vending 
of  gas  in  the  city  of  Ijaitimore,  which  it  had 
been  the  object  of  the  general  assembly  of 
Maryland  to  encourage;  and  the  settlement 
to  which  he  alludes  was  emliodied  in  the  con- 
tract in  question,  by  which  competition  was 
to  be  destroyed,  and  the  object  of  the  general 
assembly  defeated.  We  do  not  feel  called 
npon,  under  such  circumstances,  to  reverse 
the  judgment  upon  the  ground  that  the  court 
assumed  in  the  instruction  a  matter  of  fact 
which  should  have  been  left  to  the  jury  to 
determine.  According  to  the  evidence  given 
by  the  plaintiff,  he  informed  the  defendant 
"that  he  was  employed  and  would  be  paid  by 
the  Equitable  Gas-Light  Company,  if  he  made 
an  arrangement  satisfactoi-y  to  that  com[)any, 
and  that,  if  he  should  be  successful  in  bring- 
ing about  a  settlement  satisfactory  to  the  de- 
fendant also,  he  should  expect  and  claim  to 
be  compensated  by  the  defendant  lil<(Hvise." 
Since  he  had  thus  entered  upon  the  enterprise 
under  a  specitic  agreement  with  the  Equita- 
ble (ias-Light  Company,  it  is  somewhat  dif- 
ticult  to  undeistand  upon  this  record  how,  in 
carrying  such  an  express  contract  out,  he 
could  iin|iose  the  obligation  on  the  defendant 
to  pay  him  for  doing  so  upon  a  mere  notiti- 
cation  that  he  shoukl  expect  from  it  compen- 
sation for  the  services  he  had  exi)ressly  agreed 
to  render  the  other  company,  because  the  re- 
sult might  be  satisfactory  to  the  defendant, 
—a  result  necessarily  to  be  assumed  if  any 
contract  was  arrived  at.  The  defendant 
could  not,  in  that  view,  be  held  to  have  laid 
by  and  accejiled  services  which  the  plaintiff 
would  otherwise  not  have  been  obliged  to 
perform,  nor  could  plaintiff  assert  that  he 
did  perfoim  only  upon  the  expectation  of  be- 
ing also  paid  by  the  defendant.  The  hypoth- 
eses of  fact  set  up  by  the  plaintiff  in  the  in- 
structions he  asked,  and  which  were  refused, 
contain  nothing  in  respect  of  wliich  testi- 
mony tending  to  support  and  establish  such 
hypotheses  would  add  to  the  mere  fact  of  the 
notitication  of  plaintiff's  expectation,  and  the 
evidence  on  defendant's  part  tended  to  show 
a  denial  of  any  obligation  to  pay. 

But,  apart  from  this,  the  real  question 
submitted  to  us  for  decision  is  whether,  even 
if  there  were  no  other  objection  to  plaintiff's 
recovery,  such  recovery  could  be  allowed  in 
view  of  the  nature  of  the  alleged  services. 
In  Irwin  v.  Williar,  110  U.  S.  499,  510,  4 
Sup.  Ct.  Eep.  160,  it  was  held  that  where  a 


294 


ILLEGAL  SALES. 


CDntrac't,  void  on  account  of  the  illej^al  in- 
tent of  the  principal  parties  to  it,  liad  lieen 
nef;otiat(d  by  a  person  ignorant  of  such  in- 
tent, and  innocent  of  any  violation  of  law, 
tiie  latter  nii.ulit  have  a  meritorious  ground 
for  the  recovery  of  compensation  for  serv- 
ices and  advances,  but  wlien  such  agent  "is 
privy  to  the  unlawful  design  of  the  parties, 
and  brings  them  together  for  tlie  very  pur- 
pose of  entering  into  an  illegal  agreement, 
he  is  paitlceps  eriminis,  and  cannot  recover 
for  services  renderetl  or  losses  incurred  by 
himself  on  b<half  of  either  in  forwarding 
the  tranHa(  tion."  It  is  clear  from  the  evi- 
dence adduced  by  the  plaintiff  that  he  falls 
within  the  category  last  described;  and  he 
makes  profeit  ol  the  fact  that  the  lirst  sug- 
gestion in  tlie  line  of  niani[)ulating  tiie  gas 
interests  of  Baltimore  came  from  himself. 
Hence,  if  the  contract  he  brought  about  was 
forbidden  by  statute,  or  by  pub  ic  policy,  it 
is  evident  tiiat  he  could  not  recover,  and  the 
judgment  must  be  atlirmed.  liy  this  con- 
tract it  is  reiited  that  active  competition  be- 
tween the  two  companies  had  resulted  in  ex- 
pense, annoyance,  and  loss  of  profits,  and  it 
was  therefore  provided  that  the  price  of  gas 
to  consumers  should  be  placed  at  !$L75  per 
thousand  cubic  feet,  with  a  rebate  of  fifteen 
cents  a  thousand  feet  for  payment  within 
seven  days,  "unless  tiie  rate  shall  be  changed 
by  mutual  a  reement  of  the  parties  hereto  in 
writing;"  but,  as  the  defendant  had  much 
the  larger  interest,  it  might,  in  case  of  com- 
petition on  llie  part  of  any  other  gas  com- 
pany, reduce  the  rate  at  wiiich  gas  should  be 
sold  "by  eitiier  or  both  of  the  parties  hereto, 
from  time  to  time,  so  long  as  such  competi- 
tion shall  continue,"  provided  it  should  not 
be  put  at  less  than  one  dollar  per  tiiousand 
feet  witiiout  the  written  consent  of  hotii  par- 
ties; that  the  entire  net  receipts  from  the 
sale  of  gas  should  be  pooled  and  divided  be- 
tween tiie  companies  in  a  fixed  ratio,  with- 
out regard  to  the  amount  of  gas  actually  sup- 
plied by  either;  that  one  of  the  companies 
should  lay  no  more  pipes  or  mains  for  the 
supply  of  gas  in  the  city;  that  all  future 
pipes  or  mains  should  be  laid  by,  and  remain 
the  propel  ty  of,  the  other  company;  and  that 
eitiier  parly  wliicli  violated  any  of  the  cov- 
enants in  the  contract  should  pay  to  tiie  other 
the  sum  of  iii;25O,0UU  as  licjiiidated  damages. 
It  will  be  perceived  that  tiiis  was  an  agree- 
ment for  tiie  abandonment  by  one  of  the  com- 
panies of  tiie  discharge  of  its  duties  to  tlie 
public,  and  that  the  price  of  gas  as  fixed 
thereby  sliould  not  be  changed,  except  that, 
in  case  of  competition,  the  rate  might  be 
lowered  by  one,  but  not  below  a  certain 
specified  rate,  without  the  consent  of  the 
otlier.  And  in  t!ie  case  in  hand  the  E(]uita- 
ble  Gas-Light  Company  was  expressly  for- 
bidden to  enter  into  such  a  contract.  That 
company  was  incorporated  by  an  act  of  tiie 
general  assembly  of  Maryland,  passed  March 
G,  1867,  witli  a  capital  of  ?J2,U0J,U00,  wliich 
might  be  increased  to  .IJ^.OOCUUO,  and  wiLii 
aulhority  to  lay  pipes  along  and  under  the 


streets,  squares,  lanes,  and  alleys  of  the  city 
of  ]5altimore,  and  to  supply  with  light  any 
dwelling-house  or  other  buildings  or  places 
whatever  belonging  to  individuals  or  corpo- 
ratiuus,  adjacent  to  any  such  street,  squar:', 
lane,  or  alley,  and  with  "all  the  rights  and 
privileges  granted  to  the  (Jas-Liglit  Company 
of  Baltimore  by  the  second,  third,  fourtii,  and 
fiftii  sections  of  tiie  ordinance  of  the  mayor 
and  city  council  of  Baltimore,  entitled  'An 
ordinance  to  provide  for  more  effectually 
lighting  the  streets,  squaies,  lanes,  and  alleys 
of  the  city  of  Baltimore,'  approved  June  17, 
1816,  and  the  act  of  ass-ml»ly  of  Deceml>er 
session,  1816,  c.  251,  so  far  as  the  same  are 
not  inconsistent  with  the  provisions  of  tliis 
act;  and  the  said  company  lierehy  incorpo- 
rated shall  be  liable  to  all  the  duties,  restric- 
tions, and  penalties  [provided]  for  in  said 
sections  of  said  ordinance  and  in  said  act  of 
assembly."  Laws  Md.  1867,  jip.  207,  211,  212. 
Reference  to  the  act  antl  ordinance  of  1816 
(Laws  Md.  1813  1817,  c.  251,  of  1816;  Or- 
dinances, Baltimore,  1818  1822,  p.  95)  does 
not  contribute  to  the  argument  here  save  as 
indicating  the  design  of  tlie  general  assembly 
to  give  equal  poweis  to  a  competim,'  com- 
pany. Said  act  of  March  6,  1867,  §  14,  fur- 
ther provided  that  "tlie  geneial  assembly 
hereby  reserves  the  right  to  alter,  amend,  or 
repeal  this  act  at  pleasure. "  Laws  Md.  1867, 
pp.  207,  214.  Ou  the  3d  of  May,  1882,  an 
act  supplementary  to  the  act  incorporating 
the  Equitable  Gas-Light  Company  of  Balti- 
more City  was  approved,  (Laws  Md.  lC)82, 
p|t.  550,  551,)  autliorizing  and  empowering 
said  company  to  manufacture  and  sell  gas  in 
Baltimore  county  as  well  as  in  Baltimore 
city,  and  to  exercise  all  the  powers  and  rights 
con  I  erred  upon  it  by  the  ;icts  of  asseml)ly 
and  any  amendments  thereto,  including  the 
right  to  lay  all  necessary  and  convenient 
[lipes,  etc.,  in  tiie  county  as  well  as  in  the 
ciiy,  and  the  fourth  section  of  this  act  was  as 
I'ol.ows:  "That  tiie  said  company  be,  atid 
hereby  is,  prohibited  from  entering  into  any 
consolidation,  combination,  or  contract  with 
any  other  gas  company  whatever;  and  any 
attempt  to  do  so,  or  to  mal^e  such  combina- 
tions or  contracts  as  herein  prohibited,  shall 
be  utterly  null  and  void." 

In  Greenwood  v.  Freight  Co.,  105  U.  S. 
13,  the  riglit  to  repeal  the  cliarter  of  a  street- 
railioad  company  was  sustained  under  a  pro- 
vision of  the  General  Statutes  of  Massachu- 
setts declaiing  "every  act  of  incorporation 
passed  after  the  lllli  day  of  March  in  the 
year  1831  shall  be  subject  to  amendment,  al- 
terati(m,  or  repeal  at  the  pleasure  of  the  leg- 
islature." In  Close  v.  Cemetery,  107  U.  S. 
466,  476,  2  Sup.  Ct.  Rep.  267,  it  was  said 
that  "a  power  reserved  to  the  legislature  to 
alter,  amend,  or  repeal  a  charter  authorizes 
it  to  make  any  alteration  or  amendment  of  a 
charter  granted  subject  to  it,  whic*lr  will  not 
defeat  or  substantally  impair  the  object  of 
tlie  grant,  or  any  rights  vested  under  it,  and 
which  the  legislature  may  deem  necessary  to 
secure  either  that  object  or  any  public  rig'it. " 


ILLEGAL  SALES. 


295 


Similar  views  were  expressed  in  Water- 
works V.  Schottler,  110  U.  S.  347,4  Sup.  Ct. 
Hep.  48;  County  of  Caliaway  v.  Foster,  93 
U.  8.  567;  ami  otlier  cases. 

The  consent  of  the  corporation  was  not  re- 
quired to  the  o})eralion  of  such  a  provision 
as  that  embodieil  in  the  fourth  section  of  the 
act  of  1S82,  but,  if  acceptance  were  necessary, 
the  exercise  of  corporate  action  by  this  gas 
company  after  the  passage  of  the  amendment 
was  suliicient  evidence  of  sucli  acceptance. 
The  supplying  of  illuminating  gas  is  a  busi- 
ness of  a  publi  •  nature  to  meet  a  public  ne- 
cessity. It  is  not  a  business  like  that  of  an 
ordinaiy  corporation  engaged  in  the  manu- 
facture of  ai  tides  that  maybe  furnished  by 
individual  effort.  Gas-Light  Co.  v.  Manu- 
facturing Co.,  115  U.  S.  6:)0,  6  Sup.Ct.  Rep. 
252:  Gas  Co.  v.  Gas-Light  Co..  115  U.S.  68;:3,  6 
Sup.  Ct.  Rep.  205;  Siiepard  v.  Gas-Lislit  Co.,  6 
Wis.  539;  Coke  Co.  v.  C<.ke  Co.,  121  111.  530, 
13  N.  E.  Rep.  169;  St.  Louis  v.  Gas-Light 
€o.,  70  Mo.  {59.  Ileiice,  while  it  is  justly 
urged  that  those  rules  which  say  that  a  given 
contract  is  against  public  policy,  siiould  not 
be  arbitrarily  extended  so  as  to  interfere  with 
the  freedom  of  contract,  (Printing  Co.  v, 
Sampson,  L.  R.  19  Eq.  462,)  yet,  in  tiie  in- 
stance of  business  of  such  character  that  it 
presumably  cannot  be  restrained  to  any  ex- 
•tent  whatever  without  prejudice  to  the  pub- 
lic interest,  courts  decline  to  enforce  or  sus- 
tain contracts  imposing  such  restraint,  how- 
ever partial,  because  in  contravention  of 
public  policy.  This  sul)ject  is  mucii  consid- 
ered, and  the  authorities  cited  in  Transporta- 
tion Co.  v.  Pipe  Line  Co.,  22  W.  Va.  600; 
Coke  Co.  V.  Coke  Co.,  121  111.  530,  13  N.  E. 
Rep.  169;  Telegraph  Co.  v.  Telegraph  Co.,  65 
Ga.  160. 

The  decision  in  JSIitchel  v.  Reynolds,  1  P. 
Wms.  181,  1  Smith,  Lea.!.  Cas.  pt.  2,  p.  508, 
is  the  foundation  of  the  rule  in  relation  to 
the  invalidity  of  contracts  in  restraint  of 
trade;  but  as  it  was  made  under  a  condition 
of  things,  and  a  state  of  society,  different 
from  those  wliich  now  prevail,  the  rule  laid 
down  is  not  regarded  as  inllexible,  and  has 
been  consideral)ly  modilied.  Public  welfare 
is  first  considered,  and,  if  it  be  not  involved, 
ami  the  restraint  upon  one  party  is  not  great- 
er than  protection  to  the  other  party  requires, 
the  contract  may  be  sustained.  The  question 
is  whether,  under  tiie  particular  circum- 
stances of  the  case  and  the  nature  of  the  par- 
ticular contract  involved  in  it,  the  contiact  is 
or  is  not  unreasonable.  RousiLon  v.  Rousil- 
lon,  L.  R.  14  Ch.  Div.  351;  Cloth  Co.  v.  Lor- 
sont,  L.  R.  9  Eq.  345.  "Cases  must  be  judged 
.according  to  their  circumstances."  remarked 
Mr.  .Justice  Buadley  in  Navigation  Co.  v. 
Winsor.  20  Wall.  64,  68,  "and  can  only  be 
rightly  judged  when  the  reason  and  grounds 
of  the  rule  are  carefully  considered.  Tliere 
are  two  prin^  ipal  grounds  on  which  the  doc- 
trine is  founded  that  a  contract  in  restraint 
of  trade  is  void  as  against  public  policy.  One 
is  the  injury  to  the  public  by  being  deprived 


of  tli3  restricted  party's  industry;  the  other 
is  the  injury  to  the  party  him'^elf  by  being 
precludeii  from  pursuing  his  occupation,  and 
thus  being  prevented  from  supporting  him- 
self and  his  family.  It  is  evident  that  both 
these  evils  occur  when  the  contract  is  gen- 
eral, not  to  pursue  one's  trade  at  all,  or 
not  to  pursue  it  in  the  entire  realm  or 
country  The  country  suffers  the  loss  in 
both  cases;  and  the  party  is  deprived  of  liis 
occupation,  or  is  obliged  to  expatriate  him- 
self in  order  to  follow  it.  A  contract  tiiat  is 
open  to  such  grave  objection  is  clearly 
against  public  policy.  But  if  neither  of  tliese 
evils  ensue,  and  if  the  contract  is  founded 
on  a  valid  consideration  and  a  reasonable 
ground  of  benefit  to  the  other  party,  it  is  free 
irora  objection  and  may  be  enforced."  In- 
numerable cases,  however,  might  be  cited  to 
sustain  the  proposition  tliat  combinations 
among  tiiose  engaged  in  business  impressed 
with  a  public  or  quasi  public  character, 
which  are  manifestly  prejudicial  to  the  pub- 
lic interest,  cannot  be  upheld.  The  law  "can- 
not recognize  as  valid  any  undertaking  to  do 
what  fundamental  doctrine  or  legal  rule  di- 
rectly forbids.  Xor  can  it  give  effect  to  any 
agreement  the  making  wiiereof  was  an  act 
violating  law.  .So  that,  in  short,  all  stipula- 
tions to  overturn,  or  in  evasion  of,  what 
the  law  has  established;  all  promises  inter- 
fering w.th  tiie  workings  of  the  machinery 
of  the  government  in  any  of  its  departments, 
or  obstructing  its  officers  in  their  official  acts, 
or  corrupting  them;  all  detrimental  to  tlie 
public  order  and  public  good,  in  such  manner 
and  degree  as  the  decisions  of  the  courts  iiave 
delined  ;all  madeto promote  whatastatute  has 
declared  to  be  wrong, — are  void."  Bish.  Cont. 
§  549;  Iron  Co.  v.  Extension  Co.,  t»  Sup.  Ct. 
402,  (decided  at  this  term,  by  Mr.  Justice 
Field;)  Trist  v.  Child,  21  Wall.  441;  Irwin 
v.  Williar,  110  U.  S.  499,  4  Sup.  Ct.  Rep. 
160;  Arnot  v.  Coal  Co.,  68  N.  Y.  558:  Salt 
Co.  V.  Guthrie.  35  Ohio  St.  6i;6;  Woodruff  v. 
Berry,  40  Ark.  261;  Railroad  Co.  v.  Railroad 
Co.,  3  Rob.  (X.  Y.)  411;  Craft  v.  McCon- 
oughy,  79  111.  346;  Hooker  v.  A^andewater,  4 
Denio,  349;  Stanton  v.  Allen,  5  Denio,  434; 
Railroad  Co.  v.  Collins.  40  Ga.  582;  Coal  Co. 
v.  Coal  Co.,  68  Pa.  St.  173.  It  is  also  too 
well  settled  to  admit  of  doubt  tiiat  a  corpora- 
tion cannot  disable  itself  by  contract  from 
performing  the  public  duties  whieii  it  has  un- 
dertaken, and  by  agreement  compel  itself  to 
make  public  accommodation  or  convenience 
subservient  to  its  private  interests.  "  Where, " 
says  Mr.  Justice  .Miller,  dtlivering  tlie 
opinion  of  the  court  in  Thomas  v.  Railroad 
Co.,  101  U.  S.  71,  83,  "a  corporation,  lik-.-  a 
railro.ul  company,  has  granted  to  it  by  char- 
ter a  franchise  intended  in  large  meiisure  to 
be  exercised  for  the  public  good,  the  due  per- 
formance of  those  functions  beingthe  consid- 
eration of  the  public  grant,  any  contract 
wiiicli  disables  the  corporation  from  perform- 
ing those  functions,  which  undertakes  with- 
out the  consent  of  the  state  to  tiansfer  to 


296 


ILLEGAL  SALES. 


others  the  rights  and  powers  eon'"erred  by 
the  charter,  and  to  relieve  tlie  jrrantees  of  tlie 
burden  whieli  it  imposes,  is  a  violation  of  the 
contract  with  the  state,  and  is  void  as  against 
public  policy." 

These  gas  companies  entered  tiie  streets  of 
Baltimore,  under  their  cliarters,  in  the  exer- 
cise of  the  equivalent  of  the  jiower  of  emi- 
nent domain,  and  are  to  be  held  as  liaving  as- 
sumed an  obl;g;ition  to  fultiil  the  public  pur- 
poses to  subserve  which  they  were  incorpo- 
rated. At  common  law,  corporations  formed 
merely  for  the  p^^cuniary  benefit  of  tlieir 
sliareholders  could,  by  a  vote  of  the  majority 
thereof,  part  witli  their  property,  and  wind 
up  their  business;  but  corporations  to  wliich 
pr.vileges  are  granted  in  order  to  enable  tliem 
to  accommodate  the  public,  and  in  tlie  proper 
discharge  of  wiiose  duties  tlie  pul>lic  are  in- 
terested, do  not  come  within  the  rule.  But 
we  are  not  concerned  here  with  tlie  question 
when,  if  ever,  a  corporation  can  cease  to  op- 
erate witliout  forfeiture  of  its  franchises,  up- 
on the  excuse  that  it  cannot  go  forward  be- 
cause of  expense  and  want  of  remuneration. 
There  is  no  evidence  in  this  record  of  any 
suc:i  state  of  case,  and.  on  the  contrary,  it 
appears  that  the  cost  of  the  manufacture  of 
gas  was  largely  below  the  price  to  be  charged 
named  in  the  stipulation  between  the  par- 
ties. There  is  nothing  upon  which  to  rest 
tlie  suggestion  that  the  companies  were  un- 
able to  serve  the  consumers,  wliile  the  rec- 
ord shows,  on  the  other  hand,  that  they  sim- 


ply desired  to  make  larger  profits  on  what- 
ever gas  they  might  furnisli.  Nor  are  we 
called  upon  to  pass  upon  the  validity,  gener- 
ally, of  pooling  agreements.  Here  the  con- 
tract was  directly  in  the  teeth  of  the  statute,, 
which  expressly  forbade  the  Equitable  Gas- 
Light  Company  from  entering  into  it.  Tliat 
prohibition  declared  tlie  policy  of  the  state^ 
as  well  as  restrained  the  particular  corpora- 
tion. The  distinction  between  >nalum  in  se 
and  malum  prohibitum  has  long  since  been 
exiiloded,  and  as  "there  can  be  no  civil  right- 
where  tiiere  can  be  no  legal  remedy,  and 
there  can  be  no  legal  remedy  for  that  which 
is  itself  illegal,"  (Bank  v.  Owens,  2  Pet.  .527,. 
539,)  it  is  clear  that  contracts  in  direct  vio- 
lation of  statutes  ex])ressly  forbidding  their 
execution  cannot  be  enforced.  The  question 
is  not  one  involving  want  of  authority  ta 
contract  on  account  of  irregularity  of  organ- 
ization, or  lack  of  an  affirmative  grant  of 
power  in  the  charter  of  a  corpm-ation,  but  a 
question  of  the  ab.solute  want  of  power  to  do 
that  which  is  inhibited  by  statute,  and,  if  at- 
tempted, is  in  positive  terms  declared  "utter- 
ly null  and  void."  "The  rule  of  law,"  said 
P.MtKKR.  C.  J.,  in  Piussell  v.  DeGrand,  15 
Mass.  o5,  39,  "is  of  universal  operation,  that 
none  shall,  by  tiie  aid  of  a  court  of  justice, 
obtain  the  fruits  of  an  unlawful  bargain." 
Wp  Cannot  assist  the  plaintiff  to  get  pay- 
ment for  efforts  to  accomplish  what  the  law 
declared  should  not  be  done,  and  the  judgment 
niubl  be  athiiued. 


ILLEGAL  SALES. 


297 


NATIONAL   DISTILLING   CO.    v.    CREAM 
CITY  IMPORTING  CO. 

(56  N.  W.  804,  86  Wis.  3.j2.) 

Supreme   Court   of  "Wisconsin.      Nov.   7,   1S93. 

Appeal  from  circuit  court,  Milwaukee  coun- 
ty; D.  H.  Johnson,  Judge. 

Action  by  the  National  Distillng  Company 
against  the  Cream  City  Importing  Company 
for  goods  sold  and  delivered.  From  an  or- 
der denying  a  motion  to  strike  out  the  first 
defense  in  the  answer,  and  for  failure  to 
make  an  order  on  a  motion  to  make  the 
second  defense  more  definite  and  c.ertain, 
l>laintiff  appeals.    Reversed. 

The  other  facts  fully  appear  in  the  follow- 
ing statement  by  PINNEY,  J.: 

The  complaint  in  this  action  is  for  a  bal- 
ance of  .$1,148.72,  due  for  goods,  wares,  and 
merchandise,  to  wit,  alcohol,  spirits,  whisky, 
etc.,  sold  and  delivered  to  the  defendant  at 
its  special  instance  and  request.  The  an- 
swer is  to  the  effect  that  the  plaintiff,  prior 
to  the  sale  and  deliveiy  of  the  goods,  en- 
tered into  an  agreement  with  divers  firms 
and  corporations  residing  in  different  states 
for  the  purpose  of  forming  a  tnist  or  con- 
spiracy, whereby  they  agi'eed,  combined,  con- 
federated, and  associated  thems:  Ives  togeth- 
er for  that  purpose,  and  wrongfully  to  in- 
terfere with  the  freedom  of  trade  and  com- 
merce, so  that  it  might  acquire  tlie  full,  ab- 
solute, and  complete  control  and  monopoly 
of  all  alcohol,  spirits,  and  liquors  manufac- 
tured in  the  United  States,  and  the  e.vclusive 
right  to  regulate,  dictate,  and  control  the 
amount  manufactm-ed.  and  the  price  thereof, 
and  to  render  it  impossible  for  dealers  or 
consumers  to  purchase  any  such  gooJs,  etc., 
exqept  from  or  through  such  trust,  combina- 
tion, etc.;  that  it  was  impossible  for  it  to  buy 
such  goods  through  agents  or  membei-s  of 
said  trust  at  their  real  market  price  by 
reason  of  such  combination,  but  it  was  com- 
pelled to  pay  a  greater  price  tlierefor,  and 
for  the  pm'pose  of  recovering  back  such  over- 
payments on  its  pin-chasos  it  was  oblig  d  to 
enter  into  an  agreement  to  purchase  all  such 
goods  used  in  its  said  business  for  the  period 
of  six  months  succeeding  the  date  of  pur- 
chases fi'om  said  trust  or  members  thereof. 
an-d  by  so  doing  it  would  then  receive  the 
amount  of  such' overcharges;  that  its  business 
has  been  greatly  injured  by  reason  of  said 
trust,  etc.,  and  by  its  business  methods.  And 
it  was  alleged  on  information  and  bel  ef  that 
said  trust,  confederation,  or  association,  or 
the  members  thereof,  were  the  real  parties 
in  interest  in  this  action,  and  that  the  plain- 
tiff is  only  an  agent,  member,  or  one  of 
many  partners  residing  in  many  and  different 
states,  and  that  the  action  should  be  dis- 
missed, unless  brought  in  the  names  of  aU 
such  real  parties.  And  as  a  separate  de- 
fense, that  between  the  22d  of  Jun:^  and 
22d  of  October,  1S02,  the  defen.lant  pur- 
chased  goods,    wares,    and    merchandise    to 


the  amount  as  per  bills  rendered  of  more- 
than  $3..500:  that  they  were  billed  and 
charged  to  this  defendant  at  a  greater  price 
than  the  market  value,  and  with  each  bill 
an  agreement  in  writing  was  given  to  it,  a 
copy  of  which  Is  made  an  exhibit,  for  rtbate 
of  charges  as  before  stated;  that  the  spirits, 
alcohol,  wliisky,  brandies,  liquors',  and  com- 
pounded liquors  purchased  as  aforesaid  were 
of  an  inferior  quality,  and  were  not  of  the 
proof  marked  upon  the  bills  furnished  with 
the  same,  and  upon  which  proofs  the  price 
therefor  is  fixed;  that  aU  of  said  goids  were 
of  less  value  than  chargtd,  and  less  than  the 
market  price,  and  that  many  of  the  goods 
were  almost  wholly  worthless,  whereby  de- 
fendant was  damaged,  and  his  custom-^rs 
quit  trading  with  him  for  that  reison;  that 
defendant  had  paid  on  said  purchases  a  sum 
exceeding  ?2.400,  and  that  the  value  of  said 
goods,  etc.,  purchased  by  the  defendant  was 
not  gi-eater  than  that  sum.  The  plaintiff 
moved  that  the  first  defense  of  illegality 
should  be  stricken  out  as  irrelevant  and  re- 
dundant, and  that  the  scond  d  fense  set  up 
should  be  made  more  definite  and  ce.tain  by 
showing  the  date  and  amount  of  each  item 
of  goods  which  the  defendant  claims  was 
defective,  and  by  showing  of  what  the  de- 
fect consists,  whether  in  quantity  or  qual- 
ity, and  the  amovmt  of  damage  claimed  for 
each  defective  item  or  article.  The  court  de- 
nied the  motion  to  strike  out  the  specified 
portions  of  the  answer,  with  $10  costs,  but 
did  not  make  any  order  in  respect  to  that 
part  of  the  motion  to  make  the  second  de- 
fense more  definite  and  certain,  and  the 
plaintiff  appealed., 

George  E.  Sutherland,  for  appellant.  C. 
W.  Briggs,  for  respondent. 

PINNEY,  J.,  (after  stating  the  facts.)  1. 
Taking  the  allegations  of  the  fii"st  defense  in 
their  most  lil^eral  sense,  it  is  apparent  that 
tli(\v  are  irrelevant,  and  have  no  legal  re- 
lation to  the  controversj'  between  the  par- 
ties to  the  action,  which  is  whether  the  plain- 
tiff shall  recover  the  demand  set  forth  in  its 
complaint.  It  is  obvious  that  they  state  no 
defense  to  the  action;  and  it  doc-s  not  ap- 
pear that  any  of  the  matters  so  set  up  cr.n 
oe  material  in  any  aspect  of  the  case  as  now 
p!-esented,  biit  they  are  of  such  a  character 
that  they  may  embarrass  and  prejudice  the 
pl.-.intift  in  preparing  for  trial,  and  in  main- 
taining its  action  upon  the  merits.  An  entire 
defense  may  be  stricken  out  as  irrelevant, 
(Rev.  St.  §  26S4;)  and  where  a  defense  is  ir- 
relevant, and  of  the  tendency  above  indi- 
cated, it  ought  to  be  stricken  out  on  motion, 
(Horton  v.  Aimold.  17  Wis.  1-14:  School  Dist. 
V.  Kemen,  -38  ^Vis.  24G,  32  N.  W.  Rep.  42.) 
But  in  this  instance  the  motion  was  denie-d, 
Willi  .$10  costs  of  motion  a^'ainst  the  plaintiff. 
The  first  defense  does  not  deny  any  aUega- 
tiou  of  the  complaint,  but  the  substance  of 
it  is  tliat  the  sale  and  delivery  of  the  goods 
in   question   to   the   defendant   was   void   as. 


.298 


ILLEGAL  SALES. 


:i^';iinst  public  polky,  because  the  vendor 
was  at  the  time  a  member  of  an  unlawful 
trust  or  combination  formed  to  unlawfully 
inlerlVre  with  the  freedom  of  trade  and  com- 
meree,  and  in  restraint  thereof  and  to  accom- 
plish the  ends  therein  set  forth.  It  is  not 
tl. limed  in  the  aiiswer  that  the  trust  or  com- 
bination had  acquired  the  control  and  mo- 
nopoly of  all  such  goods,  or  that  the  defend- 
ant might  not  have  purchased  the  goo<ls  in 
(piestion  of  other  dealers  in  Milwaukee  or 
elsewhere.  Conceding,  for  the  piu-poses  of 
this  case,  that  the  trust  or  combination  in 
question  may  be  illegal,  and  its  members 
n;ay  be  restrained  from  carrying  out  the  pur- 
poses for  which  it  was  created  by  a  court  of 
ecpiity  in  a  suit  on  behalf  of  the  public,  or 
may  be  subject  to  indictment  and  punish- 
ment, there  is,  nevertheless,  no  allegation 
showing  or  tending  to  show  that  the  contract 
of  sale  between  the  plaintiff  and  defendant 
was  tainted  with  any  Illegality,  or  was  con- 
trary to  public  policy.  The  argument,  if  any 
the  case  admits  of,  is  that,  as  the  plaintiff 
was  a  member  of  the  so-called  "trust"  or 
"combination,"  the  defendant  might  volun- 
tarily purchase  the  goods  in  question  of  it 
at  an  agi-eed  price,  and  convert  them  to  its 
own  use,  and  be  justified  in  a  court  of  jus- 
tice in  its  refusal  to  pay  the  plaintiff  for 
them,  because  of  the  connection  of  the  vendor 
with  such  trust  or  combination.  The  plain- 
tiff's cause  of  action  is  in  no  legal  sense  de- 
pendent upon  or  affected  by  the  alleged  ille- 
gality of  the  trust  or  combination,  because  the 
illegality,  if  any,  is  entirely  collateral  to  the 
transaction  in  question,  and  the  court  is  not 
called  upon  in  this  action  to  enforce  any  con- 
tract tainted  with  illegality,  or  contrary  to 
public  policy.  The  mere  fact  that  the  plain- 
tiff is  a  member  of  a  trust  or  combination 
created  with  the  intent  and  purposes  set 
forth  in  the  answer  will  not  disable  or  pre- 
vent it  in  law  from  selling  goods  within  or 
affected  by  the  provisions  of  such  trust  or 
comolnation,  and  recovering  their  price  or 
value.  It  does  not  appear  that  it  had  stipu- 
lated ro  refrain  from  such  transactions.  A 
oont/ary  doctrine  would  lead  to  most  start- 
ling and  dangerous  consequences.  The  de- 
f-';i'lint  is  not  a  party  to  any  illegal  conti-act, 
and  the  case  is,  therefore,  not  within  the 
rule  of  Wheeler  v.  Kussell,  17  Mass.  281, 
and  many  similar  ca.ses,  to  the  effect  that  "no 
action  will  lie  upon  a  contract  made  in  vio- 
lation ()f  a  statute  or  a  principle  of  the  com- 
mon law;"  for  the  right  of  the  plaintiff  to 
make  the  sale  in  question,  or  of  the  defend- 
ant to  buy,  was  in  no  way  connected  with 
or  dependent  upon  the  alleged  trust  or  com- 
bination, although  the  plaintiff  was  a  mem- 
ber of  it.  These  views  are  sustained  and 
illustrf.^d  by  the  cases  of  Brooks  v.  Mar- 
tin, 2  WaU.  70,  and  Sharp  v.  Taylor,  2 
I'hil.  Ch.  801;  and  many  other  cases  might 
be  cited  to  the  same  effect.  The  provision 
for  a  rebate  of  a  part  of  the  purchase  price 
to  pm'chasers  who  would  conduct  their  busi- 


ness in  the  manner  stated  in  the  answer 
was  an  inducement  to  them  to  continue  their 
business  relations  with  the  plaintiff.  It  does 
not  appear  that  there  was  any  contract  obli- 
ging the  defendant  to  that  course.  A  party 
may  legally  purchase  the  trade  and  business 
of  another  for  the  purpose  of  preventing  com- 
petition, and  the  restraint  of  trade  caused 
thereby  is  not,  we  think,  unreasonable. 
Mitchell  V.  Reynolds,  1  Smith,  Lead.  Cas.  pt. 
1,  p.  417,  and  notes.  And  it  would  seem  that 
an  agreement  between  a  number  of  dealers 
and  manufacturers  to  raise  prices,  unless 
they  practically  control  the  entire  com- 
modity.—and  this  is  not  claimed  of  the  trust 
in  question,— cannot  operate  as  a  restraint 
uiiou  trade,  nor  would  it  injuriotisly  affect 
the  public. 

Both  the  plaintiff  and  defendant  are  Wis- 
consin corporations,  and  the  goods  in  ques- 
tion were  sold  in  this  state.  The  sale,  there- 
fore, was  not  a  transaction  of  interstate  com- 
merce, and  was  not  within  the  act  of  con- 
gress of  July  2,  1890.     -G  Stat.  209. 

The  allegation  that  the  trust  or  combina- 
tion is  the  real  party  in  interest  in  this  ac- 
tion, and  that  it  can  only  be  maintained 
by  it,  and  should  be  dismissed  unless  brought 
in  its  name  or  the  names  of  all  the  members 
thereof,  is  fatally  defective  as  a  plea  or  de- 
ft'iise  in  abatement.  It  does  not  appear 
whether  the  alleged  trust  or  combination  is 
a  partnership  or  a  corporation,  and  so  a 
legal  entity,  capable  of  suing  or  being  sued; 
nor  is  it  averred  that  it  or  any  of  its  mem- 
bers other  than  the  plaintiff  had  any  interest 
in  the  goods  sold  or  the  money  to  be  paid  for 
them.  The  answer  in  this  respect  deals  only 
in  conclusions  of  law,  leaving  wholly  un- 
c(mtroverted  the  allegations  of  the  complaint 
that  the  goods  in  question  were  sold  and  de- 
livered by  the  plaintiff"  to  the  defendant  at  a 
price  agreed  upon  between  them;  nor  does 
it  deny  the  allegation  of  indebtedness  there- 
for to  the  plaintiff",  "t  fails  to  state  any  facts 
showing  that  the  action  is  not  rightly  brought 
in  the  name  of  the  piaiutifi'. 

2.  The  circuit  court  onn^*^ed,  inadvertently 
as  we  presume,  to  pa.ss  upon  the  second 
branch  of  the  plaintiff's  motion,  namely,  to 
make  certain  portions  of  the  second  defense 
uiore  definite  and  certain.  It  is  correct  prac- 
tice, we  think,  to  combine  in  a  single  motion 
as  many  objections  as  the  plaintiff  supposes 
the  defendant's  answer  is  subject  to,  with  a 
view  of  having  them  all  determined  at  the 
same  time,  and  not  piecemeal,  thus  avoid- 
ing a  multiplicity  of  motions  and  possible 
appeals.  The  plaintiff  had  an  imdoubted 
right  to  have  its  motion  decided  in  aU  its 
material  aspects,  and,  without  indicating  any 
opinion  whether  the  motion  as  to  the  second 
defense  should  have  been  to  make  it  more 
definite  and  certain,  or  for  a  bill  of  particu- 
lars thereof,  we  hold  that  it  was  material 
error  for  the  circuit  court  to  omit  or  fail  to 
determine  this  branch  of  the  motion,  for,  un- 
til determined,  the  plaintiff"  coidd  not  secure 


ILLEGAL  SALES. 


the  rights  which  the  statute  gives  it  in  re- 
spect to  such  pleading,  to  either  have  the 
.same  made  more  definite  and  certain,  or  a 
bill  of  particulars  under  it,  and  it  is  thereby 
dc[)rived  of  all  remedy  it  may  have  in  this 


respect.  For  these  reasons  the  order  of  the 
circuit  court  is  erroneous,  and  must  be  re- 
versed, and  the  cause  remanded  to  the  cir- 
cuit court  for  further  proceedings  according 
to  law.    It  is  so  ordered. 


300 


ILLEGAL  SALES. 


RICHARDS  V.  AMERICAN  DESK  &  SEAT- 
L\G  CO. 

(r)8  N.  W.  TS7.  87  Wis.  503.) 

Supri'iuo  Court  of  Wiscoii.siii.      Ai)ril  10,  1894. 

Appeal  from  circuit  court,  Manitowoc  coun- 
ty;   X.   S.   Gilson.  .Iiidfio. 

Action  by  William  D.  Richards,  assifinee, 
etc.,  against  American  Desk  &  Seating  Com- 
Iiany.  From  an  order  overruling  a  demurrer 
to  defendant's  couuterclaiiii.  plaintiff  appeals. 
Reversed. 

The  plaintiff  sues  as  assignee  of  the  Mani- 
towoc Manufacturing  Company,  a  Wisconsin 
corporation,  which  was  engaged  in  the  manu- 
facture and  sale  of  school,  church,  and  opera- 
house  furniture,  and  other  furniture  and  spe- 
cialties, and  the  defendant  is  an  Illinois  cor- 
poration, and  during  the  times  named  in 
the  pleadings  was  engaged  in  buying,  selling, 
and  manufacturing  the  .same  kinds  of  furni- 
tuj'e.  The  action  is  brought  for  the  recov- 
ery of  $10,000  for  goods,  wares,  and  mer- 
chandise of  the  kind  above  mentioned,  sold 
and  delivered  by  the  plaintiff's  assignor  to 
the  defendant.  The  defendant  set  up  two 
counterclaims  for  damages,  in  all  in  the  sum 
of  $3T0.0(K).  for  alleged  breaches  of  two 
certain  written  agreements  executed  by  the 
plaintiff's  assignor  and  the  defendant;  one 
of  them,  dated  P^ebruary  8,  1889.  was  to  ter- 
minate Fel)ruary  1,  1S94,  and  the  other  and 
material  one  Avas  made  June  18,  1890,  and 
was  to  continue  in  force  until  December  31, 
1894.  The  question  presented  was  whether 
these  contracts  were  valid  or  void  as  against 
ptiblic  policy,  as  being  in  restraint  of  trade. 
By  the  tirst  contract  it  was  agreed  that  the 
plaintiff's  assignor  should  make,  in  such 
«piantities  and  kinds  as  might  be  ordered  by 
the  defendant,  and  deliver  the  same  free  on 
board  at  Chicago,  111.,  opera  and  chiu-ch 
chairs,  pews,  settees,  bank,  church,  hall, 
lodge,  office,  store,  and  school  furniture,  in- 
cluding store  stools,  measuring  machines, 
goods  and  book  shelves,  and  other  special- 
ties, all  of  which  were  "to  be  made  for  and 
.sold  to  the  defendant  only,  dtuing  the  term 
of  this  contract,"  and  the  defendant  agreed 
•'to  purchase  ,$"J.")0,000  worth  of  goods  under 
this  contract"  of  the  plaintiff's  assignor. 
By  the  second  contract  the  plaintiff's  assign- 
or was  to  make  and  deliver  to  the  defend- 
ant, free  on  board  at  Chicago,  goods  manu- 
factured by  it,  in  such  quantities  and  kinds 
as  might  be  ordered  by  the  defendant,  of 
substantially  the  same  character  as  provided 
in  the  tirst  contract,  and  the  orders  of  the  de- 
fendant were  to  have  a  preference  over  all 
other  work.  After  making  provisions  with 
regard  to  patterns  and  other  matters  not 
material  to  the  present  question,  it  was  stip- 
ulated that  the  prices  to  be  paid  by  the  de- 
fendant, except  for  the  iron  i)arts  or  castings, 
should  not  exceed  the  prices  charged  by  any 
other  responsible  nianufactvn-er  for  like 
goods,  and  prices  were  specified  for  the  iron 


parts.  It  was  agreed  that,  if  the  plaintiff's 
assignor  fulfilled  the  covenants  on  its  part, 
the  defendant  should  purchase  of  the  plain- 
tiff's assignor  "during  the  period  of  this  con- 
tract, and  under  its  terms,  goods  or  other 
articles  to  the  amoxuit  of  not  less  than  $200,- 
000,"  specifying  the  time  and  manner  of  pay- 
ment for  the  same,  and  that,  "during  the 
term  of  this  contract,  the  party  of  the  first 
part  (plaintiff's  assignor)  shall  not  sell,  either 
directly  or  indirectly,  any  of  the  goods  or 
articles  of  the  several  kinds  hereinbefore 
agreed  to  be  made  for  and  delivered  to  the 
party  of  the  second  part,  within  the  following 
described  territory,  west  of  and  including 
the  following  counties  in  Wisconsin:  Ash- 
laud,  Price,  Taylor,  Clark,  .Jackson,  Monroe, 
Vernon,  and  Richland,  and  south  of  and  in- 
cluding the  following  comities:  Iowa,  Dane, 
Jefferson,  Watikesha,  and  Milwaukee;  in 
Michigan,  all  the  territory  south  of  and  in- 
cluding the  following  counties:  INIuskegon, 
Kent.  Montcalm,  Gratiot,  Saginaw,  Tuscola, 
and  Huron;  and  all  of  the  following  named 
states  and  territories:  Illinois,  Indiana,  South 
Carolina,  Georgia,  Florida,  Alabama,  Missis- 
sippi, Louisiana,  Arkansas,  Missouri,  Iowa, 
Minnesota.  North  Dakota.  South  Dakota,  Ne- 
braska, Kansas,  Indian  Territory,  Texas, 
New  Mexico,  Colorado,  Wyoming.  Montana, 
Washington,  Idaho,  Oregon,  Nevada,  Utah, 
California,  Arizona,  and  Mexico.  Nor  shall 
the  party  of  the  tirst  part,  diu-ing  the  term 
of  this  contract,  sell  anj-  of  said  goods  or  ar- 
ticles to  any  person,  firm,  or  corporation 
whom  it  knows,  or  has  good  reason  to  be- 
lieve, intends  to  resell  the  same  within  said 
territory."  It  was  further  agreed  "that,  dur- 
ing the  term  of  this  contract,  the  partj'  of  the 
second  part  (the  defendant)  shall  not  sell, 
either  directly  or  indirectly,  any  of  the  goods 
or  articles  of  the  several  kinds  hereinbefore 
agreed  to  be  made  for  and  delivered  to  it 
(except  as  hereinafter  expressly  provided) 
within  the  following  described  territory:  In 
Wisconsin,  all  of  the  territory  east  of  the  fol- 
lowing counties:  Ashland.  Price,  Taylor, 
Clark,  Jackson,  Monroe,  Vernon,  and  Rich- 
land, and  north  of  the  following  counties: 
Iowa,  Dane,  Jefferson,  Waukesha,  and  Mil- 
waukee; in  Michigan,  all  of  the  territory 
north  of  the  following  comities:  Muskegon, 
Kent,  Montcalm,  Gratiot,  Saginaw,  Tuscola, 
and  Huron;  and  all  of  the  following  states 
and  territories:  Maine,  New  Hampshire,  Ver- 
mont, Massachusetts,  Rhode  Island,  Connect- 
icut, New  York,  New  Jersey,  Penn.sylvania, 
Delaware,  Mai-yland,  West  Virginia,  Virginia, 
North  Carolina,  Tennessee,  Kentucky,  and 
Ohio.  Nor  shall  the  party  of  the  second 
part,  during  the  term  of  this  contract,  sell 
any  of  said  goods  or  articles  to  any  person, 
fii-m,  or  corporation  whom  it  knows,  or  has 
good  reason  to  believe,  intends  to  resell  the 
same  within  said  last-described  territory:  pro- 
vided, however,  and  it  is  expressly  agreed, 
that  the  party  of  the  second  part,  or  its 
agents,  may  sell  in  any  part  of  the  United 


ILLEGAL  SALES. 


301 


States  thf  dosk  known  as  the  'Yale  desk,' 
school  ai)paratii.s  and  settees,  and  bank,  of- 
fice, Mud  store  fnrniture,  and  that  any  sale 
of  said  Yale  desk,  or  any  school  apparatus 
or  settei'S.  or  any  bank,  otlice,  or  store  furni- 
ture, in  anj-  state  or  territory  by  the  party 
of  the  second  part,  or  any  of  its  agents,  shall 
not  be  deemed  a  violation  of  thia  contract 
or  any  of  its  provisions.  *  *  *  A  sum 
equal  to  twenty-tive  per  cent,  of  the  amount 
of  any  sale  made  by  either  of  the  parties  in 
viohition  of  tlie  provisions  of  the  contract,  as 
liquidated  damai^es,  and  not  as  a  penalty, 
shall  be  paid  by  the  party  making  any  such 
sale,  to  the  other  party,  but  the  delivery  by 
either  of  the  parties  within  the  territory  of 
the  other,  under  and  in  performance  of  any 
(>xisting  contract,  shall  not  be  construed  as 
a  violation  of  this  contract."  It  was  further 
agreed  that  each  of  the  parties  should  trans- 
fer to  the  other  any  agency  or  agencies  it 
might  then  have,  and  the  good  will  of  any 
business  it  may  have  established,  within  the 
territory  of  the  other  as  thus  defined;  the 
plaintiff's  assignor  was  to  pay  to  the  defond- 
anr  a  commission  of  5  per  cent,  on  the  amount 
received  for  any  goods  or  articles  which 
might  be  thereafter  delivered  by  it  to  any 
person,  firm,  or  corporation  within  the  ter- 
ritory of  the  party  of  the  second  part,  under 
any  then  existing  contracts;  and,  fm"ther, 
that  the  first-named  contract  should  not  be 
in  force  thereafter,  but  that  this  contract  or 
any  of  its  provisions  should  not  be  construed 
•  as  waiving  or  releasing,  or  in  any  way  im- 
pairing, any  claim  or  right  of  action  either 
party  may  have  against  the  other  under  and 
by  reason  of  said  conti'act  of  February  8, 
18S0,  or  otherwise." 

The  first  counterclaim  is  for  damages  for 
neglecting  and  refusing  to  manufacture 
$100,000  worth  of  goods  ordered  under  the 
last-named  contract,  in  the  amoimt  of  ?J."),- 
<XJO,  and  for  a  claim  for  mistakes  in  filling 
orders,  for  not  replacing  castings  that  were 
imperfect  and  broken,  and  unreasonably  de- 
laying the  shipment  of  goods  ordered,  the 
sum  of  $."5.0(X);  and  in  the  sum  of  S3,0(X)  for 
patterns  not  paid  for  or  returned,  furnished 
l)y  the  defendant  under  tlie  second  contract; 
25  per  cent,  liquidated  damages  on  damages 
sustained  by  the  sale  of  nearly  all  the  dif- 
ferent kinds  of  manufactured  goods  specified 
in  the  contract  in  the  defendant's  district 
during  the  years  1890.  1891.  1S92,  in  the  state 
of  Illinois,  on  sales  amounting  to  .$40,(hm»;  in 
Indiana,  ?10,000;  South  Carolina,  $.j,0(X); 
Georgia,  $10,000;  Florida.  $10,000;  Alabama, 
$5,0(X»;  Mississippi,  $5,000;  Louisiana.  $7,- 
000;  the  suite  of  Wisconsin,  $10,000;  Mis- 
som-i,  $15,000;  Iowa.  $10,(X)0;  Minnesota.  $15,- 
000;  North  Dakota.  $5,0(X);  South  Dakotn, 
$5,000;  Nebraska,  $10,000;  Kansas,  $15.uou; 
Indian  Territoiy.  $1.0(X»;  Texas,  $15,0(X); 
New  Mexico,  $4,(MX);  Colorado.  $10.0(K);  Wy- 
oming, $5,t)00;  Montana,  $S.0O0;  Washing- 
ton, $15,000;  Idaho,  $5,000;  Oregon.  $10.0(X); 
Nevada,    $5,0U0;     Utah.    $7,000;     California, 


$25,<Mju;  Arizona,  $."..<XX);  Mexico,  $5,000;  in 
territory  in  Wisconsin,  in  which  it  agreed 
not  to  sell.  $2(M»<M);  in  like  forbidden  districts 
in  the  state  of  Michigan.  $.50.iM»t>;  in  all. 
amuunting  to  $:{i;5,0<J<>,  upon  which  damages 
were  claime<l  in  the  sum  of  .$91.2.5o.  The 
second  counterclaim  was  for  the  sum  of  $5,- 
000.  founded  upon  a  provision  of  the  secontl 
contract  alxjve,  to  the  effect  that  the  plain- 
tiff's assignor  should  pay  to  the  defendant  a 
commission  of  5  per  cent,  on  the  amount  th(! 
plaintiff's  assignor  received  for  any  goods 
or  articles  which  it  might  thereafter  deliver 
to  any  persoi:,  firm,  or  corporation  within  the 
defendant's  territoiy  under  any  then  exist- 
ing contracts,  and  which,  in  ert'ect,  was  a 
part  consideration  for  the  defendant's  stipu- 
lations; and  it  was  alleged  that  the  defend- 
ant had  sold  and  delivered,  for  the  plain- 
tift"s  assignor,  such  goods,  wares,  etc.,  to  the 
amount  of  $100.(XX).  and  that  it  was  entitle<l 
by  the  terms  of  said  conti-act  to  a  commis- 
sion of  5  per  cent.,  amounting  to  $5,(XX).  The 
plaintiff  demurred  separately  to  each  of 
these  counterclaims,  on  the  ground  that  it 
did  not  state  facts  sufficient  to  constitute  a 
defense,  nor  .sufficient  to  constitute  a  coun- 
terclaim. The  circuit  court  made  an  order 
overruling  the  denuu-rers,  from  which  the 
plaintiff  appealed. 


Nash  &  Nash,  for  appellant 
Markham,  for  respondent. 


Markham  &, 


FINNEY,  .1.  (after  stating  the  facts).  The 
agreement  in  question  is  in  partial  or  limit- 
ed resti-aint  of  the  trade  of  both  of  the  par- 
ties to  it  in  certain  lines  of  articles  which 
were  to  be  manufactured  and  sold  by  tlie 
plaintiff's  assignor  to  the  defendant,  up  to 
the  amount  of  $200.0(XJ.  and  during  a  period 
of  less  than  four  years.  By  the  terms  of  the 
agreement  the  plaintiff's  assignor  was  pre- 
vented from  selling,  directly  or  luuirectly, 
any  other  like  articles  of  its  manufacture 
during  that  time  in  a  large  part  of  Wisconsin 
and  of  Michigan,  and  in  any  part  of  30  other 
states  and  territories  of  the  United  States, 
and  a  like  restraint  was  imposed  on  the  de- 
fendant as  to  the  remainder  of  Wisconsin 
and  Michigan,  and  all  the  other  states  of  the 
Union.  Both  counterclaims  are  founded  up- 
on, and  grow  out  of.  the  alleged  breaches  by 
the  plaintiff's  assignor  of  provisions  of  this 
contract,  and  are  dependent  upon  its  valid- 
ity, but  the  more  iniportiint  one  relates  to  a 
claim  to  recover  25  per  cent,  of  the  amount 
of  sales  alleged  to  have  been  made  by  the 
plaintiff's  assignor  within  said  period  in  the 
territory  set  apart  exclusively  to  the  defend- 
ant for  making  sales  of  such  articles.  It 
will  be  seen  from  the  statement  of  the  case 
that  the  restraint  against  the  plaintift"s  as- 
signor, alleged,  to  have  been  violated,  was 
total  in  all  the  states  and  territories  named 
in  it.  except  Wisconsin  and  Michigan,  where 
it  extended  to  parts  only  of  those  states,  but 
it  was  IJT'^.TC-d  in  respect  to  the  time  it  was 


302 


ILLEGAL  SALES. 


to  fontiiuie.  That  any  asreoment  in  re- 
straint of  trade  of  one  of  the  parties  to  a 
runtract  is  void,  as  being  against  public  pol- 
icy, unless  fouuucu  upon  a  valuable  consid- 
eration, and  limited,  as  regards  time,  space, 
and  the  extent  of  uie  trade,  to  what  is  rea- 
sonable under  the  circumstances  of  the  case, 
is  well  settled,  for  the  reason  that  such  con- 
tracts tend  to  deprive  the  public  of  the  serv- 
ices of  parties  in  the  employments  and  ca- 
pacities in  which  they  are  most  usefvil,  and 
that  they  tend  to  expose  the  pul)lic  to  the 
evils  of  monopoly.  Kellogg  v.  Larkin.  3  Pin. 
1-J3;  Laubenhcimer  v.  Mann,  17  Wis.  561; 
Alger  V.  Thacher,  19  Pick.  51;  Bishop  v. 
Palmer,  146  Mass.  4(59,  473,  16  N.  E.  299; 
Navigation  Co.  v.  AVinsor,  20  Wall.  66,  67; 
Gibbs  V.  Gas  Co.,  130  U.  S.  396,  9  Sup.  Ct. 
553;  Lange  v.  W-n-ke,  2  Ohio  St.  519;  Tele- 
graph Co.  V.  Crane  (:Mass.)  35  N.  E.  98. 
These  cases  show,  and  many  others  might  be 
cited  to  the  same  effect,  that  it  is  essential, 
in  order  not  to  be  unreasonable,  that  the  re- 
straint imposed  must  not  be  larger  than  is 
plainly  required  for  the  protection  of  the  par- 
ty with  whom  the  contract  is  made,  and 
whether  it  is  reasonable  in  a  given  case  is  a 
question,  not  of  fact,  but  of  law  for  the 
court.  Pol.  Cont.  366-368;  Washburn  v. 
Dosch,  68  Wis.  440,  .3-^  N.  W.  551.  The  test 
as  to  whether  thp  restraint  is  reasonable  or 
not  is  well  expressed  in  the  often-cited  case 
of  Horner  v.  Graves,  7  Bing.  735,  743,  where 
it  is  said:  "The  question  is  whether  the  re- 
straint is  such  only  as  to  afford  a  fair  pro- 
tection to  the  interests  of  the  party  in  favor 
of  whom  it  is  given,  and  not  so  large  as  to 
interfere  with  the  interests  of  the  public. 
Whatever  restraint  is  larger  than  the  neces- 
sary protection  of  the  party  can  be  of  no 
benefit  to  either.  It  can  only  be  oppressive; 
and,  if  oppressive,  it  is.  in  the  eye  of  the 
law,  unreasonable."  It  is  said,  in  substance, 
in  many  cases,  that  all  restraints  are  pre- 
sumed to  be  bad,  but,  if  the  circumstances 
are  set  forth,  that  presumption  may  be  ex- 
cluded, and  the  court  is  to  judge  of  these  cir- 
cumstances whether  the  contract  be  valid  or 
not.  Taylor  v.  Blanchard.  13  Allen,  373;  Cal- 
lahan V.  DonnoUy,  13  Am.  Kep.  172,  and 
note;  Mallan  v.  May,  11  Mees.  &  W.  853; 
Lange  v.  Werke.  2  Ohio  St.  519;  Kellogg  v. 
Larkin,  3  Pin.  123;  Machine  Works  v.  Per- 
rj%  71  Wis.  495,  499,  501,  38  N.  AV.  82.  It  is 
held,  in  substance,  in  these  cases,  that  the 
ph>ading  will  be  bad  on  dennwrer  if  it  does 
not  appear  from  the  contract  or  .averments 
of  exu  uisic  facts  that  the  restraint  was  rea- 
sonable. This  is  in  accordance  with  the 
great  weight  of  authority,  and  seems  to  be 
the  nec(>ssary  result  of  the  rvile  as  to  the  va- 
lidity of  such  restraint.  The  gi'eat  diffusion  of 
wealth,  the  wonderful  advances  made  in  the 
methods  and  facilities  for  manufacturing 
and  carrying  on  commerce,  the  manifold  im- 
provements in  machinery,  and  in  the  adapta- 
tion of  steam  and  electricity  as  motive  pow- 
ers, have  enlarged  or  opened  numerous  tields 


of  industry,  and  wrought  marvelous  chan- 
ges, and  the  tendency  of  the  later  cases  has 
been  in  relaxation  of  the  earlier  rule  in  re- 
lation to  contracts  in  resti'aint  of  trade. 
The  most  liberal  and  advanced  doctrine  on 
the  subject  in  this  country  is  found  in  the 
case  of  Match  Co.  v.  Roeber,  106  N.  Y.  473, 
13  N.  E.  419,  in  which  the  history  of  the  law 
is  elaborately  considered,  and  a  covenant 
excluding  a  manufacturer  of  matches,  who 
had  sold  his  property,  stock,  etc.,  from  en- 
gaging in  the  manufacture  and  sale  of 
matches  for  a  period  of  99  years  within  any 
of  the  states  and  territories,  except  Nevada 
and  Montana,  was  sustained;  but  it  appear- 
ed in  that  case  that  before  such  sale  he  had 
carried  on  the  business  of  manufacturing 
friction  matches,  "and  of  selling  the  same  in 
the  several  states  and  territories  of  the  Unit- 
ed States,  and  in  the  District  of  Columbia," 
and  so  the  case  really  came  within  the  rule 
under  consideration,  and  the  restraint  was 
reasonably  necessary  to  protect  the  other  par- 
ty in  his  purchase,  in  view  of  the  circum- 
stances disclosed.  Tode  v.  Gross,  127  N. 
Y.  485,  28  N.  E.  469,  was  in  relation  to  a  i-e- 
straint  imposed  upon  the  vendor  of  a  busi- 
ness foun-:led  on  a  secret  process,  but  it 
recognizes  and  sustains  the  general  rule.  A 
manufacturing  business  founded  iipon  the 
use  of  a  secret  process,  or  the  use  of  patent- 
ed processes  or  means,  is  n5t  understood  to 
be  within  the  rule.  The  cases  of  Leather 
Cloth  (;o.  V.  Lorsont,  L.  R.  9  Eq.  345,  and 
Rousillou  V.  Rousillon,  14  Ch.  Div.  351,  are 
understood  to  represent  the  more  modern 
views  of  the  law  on  this  subject  in  England. 
In  the  former  case  it  Avas  said:  "All  re- 
straints upon  trade  are  bad  as  being  in  viola- 
tion of  publ'c  jjolicy,  unless  they  are  actual- 
ly and  not  unrea.sonably  for  the  protection 
of  parties  in  dealing  legally  with  some  sub- 
ject-matter of  contract."  The  same  sub- 
ject was  considered  in  the  somewhat  recent 
case  of  Davies  v.  Davies,  36  Ch.  Div.  359. 
in  which  Cotton,  L.  .1.,  held  the  law  to  be 
"that  a  limited  restraint  may  be  good,  pro- 
vided the  resti-aint  is  reasonable,  and  such 
as  was  required  for  the  protection  of  par- 
ties with  whom  the  covenant  is  entered  in- 
to," and  that  the  rvile  ought  not  to  be  altered 
but  by  the  house  of  lords;  and  Bowen,  L. 
J.,  held  substantially  the  same  view,  and  no- 
tices that  in  that  case  the  court  had  no  ma- 
terials for  deciding  that  the  covenant  in 
question  was  beneficial  to  the  public,  or  rea- 
sonably necessary  for  the  protection  of  th" 
covenantee,  and,  in  substance,  that  to  sus- 
tain it  would  be  "leaping  into  the  dark;" 
while  Fry.  L.  .J.,  was  inclined  to  adhere  to 
liis  decision  in  Rousillon  v.  Rousillou,  supra, 
and  hold  that  the  burden  of  proof  as  to  the 
validity  of  the  restraint  is  shifted  by  show- 
ing that  it  has  been  entered  into  for  the  pro- 
tection of  the  interests  of  one  of  the  con- 
tracting parties. 

The    counterclaims    and    second    contract, 
made    an    exhibit    thereto,    are    exceedingly 


ILLEGAL  SALES. 


305 


meager,  and  wholly  insufficient  to  show  that 
the  agreement  of  restraint  insisted  on  by  the 
defendant  was  reasonably  nooessai'y  for  the 
protection  of  its  interests  under  the  contract. 
While  it  appears,  by  implication,  that  the 
respective  parties  may  have  agencies  in  the 
territory  set  apart  to  each  for  the  sale  of 
the  line  of  goods  and  wares  mentioned  in  the 
contract,  there  is  nothing  to  show  the 
amount  of  annual  output  of  these  goods  and 
wares  by  the  plaintiff's  assignor,  or  of  the 
ordinary  amount  of  manufacture  and  sale  by 
either  party,  or  that  the  defendant  had  estab- 
lished or  carritHl  on  any  trade  in  more  than 
one  state  out  of  the  thirty  states  and  terri- 
tories to  which  the  restraint  it  seeks  to  en- 
force extends,  and  in  respect  to  which  it 
chaiges  violations   of   this  restraint   by    the 


plaintiff's  assignor.  The  counterclaims  whol- 
ly fail  to  show  tliat  the  defendant's  inter- 
est for  less  than  foiu*  years  in  the  sale  and 
disposition  of  .$200,000  in  value  of  the  goods 
and  wares  mentioned,  even  upon  the  most 
liberal  view  of  the  subject,  and  under  the 
existing  state  of  trade  and  competition, 
would  justify  the  very  extensive  restraint 
relied  on.  It  follows  from  these  views  tliat, 
upon  the  face  of  the  pleadings,  it  is  not 
made  to  appear  that  the  conti-act  was  a 
reasonable  and  valid  one,  and  therefore  the 
portions  of  the  order  appealed  from  are  er- 
roneous. The  parts  of  the  order  of  the  cir- 
cuit coiu't  appealed  from  are  reversed,  and 
the  cause  is  remanded,  with  directions  to 
sustain  the  plaintiff's  said  demuiTers  to  the 
counterclaims. 


1104 


ILLEGAL  SALES. 


GREGORY  et  al.  v.  WENDELL  et  al. 
(39  Mich.  337.) 
Supreme  Court  of  Michigan.     Oct.   1.5,  187S. 
As.simipsit.     Plaintiffs  bring  error. 

Atkinson  &  Atkinson,  for  plaintiffs  in  error. 
Otto  Kircbner  and  Asnley  Pond,  for  defend- 
ants iii  error. 

MAKSTON,  J  Plaintiffs  reside  in  Owosso, 
and  in  1877  were  euj^aged  in  the  purchase  of 
grain  and  other  farm  products.  Defendants 
were  eoiumissiou  merchants  in  the  city  of  De- 
troit. 

On  the  26th  of  April,  1877,  one  of  the  plain- 
tiffs had  a  con-  ersation  with  one  of  the  de- 
fendants in  the  city  of  Detroit  about  speculat- 
ing in  corn  and  wheat.  It  resulted  in  plaintiff's 
•directing  defendants  to  purchase  for  them  20,- 
OUU  bushels  of  corn,  deliverable  at  Chicago  in 
June  following.  It  was  claimed  that  defend- 
ants thereupon  telegraphed  to  certain  commis- 
sion merchants  in  Chicago  directing  the  pur- 
chase, and  received  a  few  minutes  thereafter 
a,  telegram  announcing  the  purchase  of  the 
quantity  mentioned  and  at  prices  therein 
named.  It  was  at  this  time  agreed  that  plain- 
tiffs should  send  defendants  $l,(MXt  as  a  mar- 
gin upon  this  purchase,  which  was  done  within 
a  few  days  thereafter.  The  receipt  thereof 
was  acknowledged  bj  defendants  and  credited 
to  plaintiffs'  account. 

Other  correspondence  was  had  between  these 
parties  in  reference  tc  this  purchase  and  the 
condition  of  the  grain  markets. 

On  May  17th  plaintiffs  wrote  defendants, 
suggesting  a  change  fiom  June  to  July  corn, 
and  on  the  ISth  defendants  wrote  plaintiffs 
that  they  had  sold  the  June  corn  and  pur- 
chased July  coi-n,  and  enclosed  a  statement  of 
account  showing  a  loss  to  plaintiffs.  The  re- 
ceipt of  this  lettei  by  plaintiff's  was  on  the 
next  day.  and  a  hope  expressed  that  the  loss 
sustained  on  the  June  would  be  got  back  on 
the  July  corn.  The  market  continued  to  de- 
cline. Further  margins  were  called  for,  but 
not  made.  Two  car  loads  of  wheat  were 
shipped  by  plaintiffs  to  defendants,  and  by 
them  sold  on  commission,  and  the  proceeds 
credited  to  plaintiffs  on  account. 

Action  was  brought  to  recover  the  amount 
received  for  this  wheat,  and  to  recover  back 
the  !?1,(XX)  margin.  There  was  no  dispute  as 
to  the  wheat  or  its  vauie,  and  judgment  was 
recovered  for  the  amomit  thereof.  The  court 
charged  the  jury  that  no  part  of  the  ^il.OOO 
could  be  recovered  In  this  it  is  claimed  thr.t 
the  court  erred,  and  also  in  not  submitting  the 
question  o  the  jury  whether  any  corn  was 
ever  actually  purcl  ased. 

Gregory,  one  of  the  plaintiffs,  testified  that 
be  never  saw  any  of  the  corn,  and  that  none 
Lad  ever  been  delivered  to  him. 

He  also  testified  that  in  .July  certain  parties 
called  at  his  office;  that  they  had  an  en- 
velope, the  contents  of   which  he  declined  to 


examine,  and  there  was  evidence  tending  to 
show  that  they  were  there  and  offered  to  make 
him  a  tender  of  war«'house  receipts  for  July 
corn.  There  was  evidence  tending  to  show 
that  before  the  commencement  of  this  action 
defendants  were  called  upon  in  the  phiiutiffs' 
interest,  and  requested  to  produce  and  show 
the  telegrams  in  reference  to  the  purchase  cf 
the  June  corn,  but  that,  although  search  v.'as 
ma<le,  they  were  unable  to  find  them,  although 
such  were  produced  on  the  trial.  A  Mr. 
Thomas,  a  broker  on  'change  for  Cooley  & 
McHeury  of  Chicago,  te.-;titied  that  he  pur- 
chased twenty  thousand  bushels  of  corn  on 
April  2Gth;  that  he  j^nd  the  party  from  whom 
he  purchased  made  the  usual  memorandum  of 
the  transaction,  wdiich  was  afterwards,  in  ac- 
cordance with  the  .custom,  reduced  to  formal 
entries  on  their  respective  books.  The  orig- 
inal memorandum  and  entries  Avere  not  pro- 
duced, and  the  witness  was  unable  to  give  the 
name  of  the  person  from  whom  he  purchased 
the  corn,  or  where  it  was  at  the  time,  or  to 
whom  he  afterwards  sold  it.  Other  evidence 
was  given,  which  it  was  claimed  tended  to 
show  that  no  actual  sale  of  corn  had  been 
made. 

It  seems  to  me  that  the  real  questions  thus 
raised  in  the  case  were:  Was  there  an  actual, 
bona  fide  sale  of  corn  intended  by  the  par- 
ties, or  any  of  them,  to  be  delivered  and  re- 
ceived':' Or  did  the  parties  intend  that  no  corn 
should  be  purchased,  delivered,  or  received, 
but  that  a  settlement  should  be  made  upon  a 
ba.sis  of  the  market  price  of  corn  at  the  time 
mentioned  for  delivery?  Some  nice  distinc- 
tions have  heretofore  been  drawn  as  to  the 
right  of  a  person  to  sell  personal  property  not 
at  the  time  owned  by  him,  but  which  he  in- 
tended to  go  into  the  market  and  Ijuy;  or,  as 
was  said,  that  which  he  hath  neither  actual- 
ly nor  potentially  Courts,  must,  however, 
from  necessity,  recognize  the  methods  of  con- 
ducting and  carrying  on  business  at  the  pres- 
ent day,  and,  applying  well-settled  principles 
of  the  common  law,  enforce  what  might  be 
called  a  new  class  or  kind  of  agreements, 
heretofore  unknown,  unless  they  violate  some 
rule  of  public  policy.  The  mercantile  business 
of  the  preseut  aay  could  no  longer  be  success- 
fully carried  on  if  merchants  and  dealers  were 
unable  to  purchase  or  sell  that  which,  as  to 
them,  had  no  actual  or  potential  exi.stence.  A 
dealer  has  a  clear  right  to  sell  and  agree  to 
deliver  at  some  future  time  that  which  he 
then  has  not,  but  expects  to  go  into  the  market 
and  buy.  And  it  is  equally  clear  that  the 
parties  may  mutiially  agree  that  there  need 
not  be  a  present  delivery  of  the  goods,  but 
that  such  delivery  may  take  place  at  some  oth- 
er time;  and  that  there  need  not  be  an  actual 
manual  possession  given,  but  a  symbolical  one, 
as  by  the  delivery  of  warehouse  receipts  ac- 
cording to  custom,  is  also  beyond  dispute. 

In  these  cases  there  is  something  actual  and 
tangible  sold,  although  not  then  owned  or 
possessed  by  the  vendor,  or  rather  something 
actual  and  tangible  agreed  to  be  sold,  as  the 


ILLEGAL  SALES. 


305 


flgi'eemeut  is  more  in  the  nature  of  a  contract 
for  a  futm-e  sale.  There  is  also  an  intention, 
ami  such  is  the  agreement,  that  when  the  time 
agrtitl  upon  for  delivery  arrives  the  property 
shall  be  actually  delivered.  This,  as  already 
said,  may,  as  in  the  case  of  grain,  be  by  a  de- 
livery of  warehouse  receipts,  for  the  quantity 
and  quality  agreed  upon,  rather  than  for  any 
particular  lot.  The  vendee  under  such  an 
agreement  may,  before  the  time  for  delivery 
to  him  has  arrived,  agree  to  sell  or  transfer 
his  right  to  the  goods,  or  under  the  contract  to 
some  one  else,  who.  should  he  retain  the  same, 
would  be  entitled  to  receive  possession  there- 
.,of  at  the  time  agreed  upon  by  the  parties 
through  whom  he  claims  title. 

But  where  the  parties,  at  the  time  of  en- 
tering into  an  agreement  for  the  purchase  and 
sale,  apparently,  of  goods  for  future  delivery, 
.agree  that  no  title  to  any  property  shall  pass, 
and  that  nothing  shall  be  delivered,— no  de- 
livery made;  or  Avhere,  from  the  nature  of 
the  transaction  and  the  manner  and  method 
.of  carrying  on  the  business,  it  is  apparent 
that  such  was  the  intention  of  the  parties,  al- 
though not  expressed,  but  the  agreement  or 
understanding  was  that  at  the  time  fixed  for 
;delivery  they  should  settle,  upon  a  basis  of 
the  then  mark'et  price  of  the  commodity,  by 
the  losing  party  paying  to  the  other  the  diffei'- 
ence,— such  an  agreement  would  be  one  that 
the  law  would  not  recognize  and  enforce.  It 
would  not  constitute  a  sale  or  an  agreement 
to  sell  property  of  any  kind,  but  one  to  specu- 
late upon  the  prices  that  certain  property 
would  be  likely  to  bring  at  some  future  day. 

The  distinction  was  clearly  pointed  out  in 
Rumsey  v.  Berry,  65  Me.  574.  The  court 
said:  "The  mischief  and  illegality  arises 
when  the  apparent  contract  is  not  the  real 
■  one;  when  it  is  a  mere  cover  for  ulterior  de- 
signs, and  such  as  are  not  authorized  by 
law.  A  contract  for  the  sale  and  purchase 
.of  wheat  to  be  delivered  in  good  faith  at  a 
future  time  is  one  thing,  and  is  not  incon- 
sistent with  the  law.  But  such  a  contract 
entered  into  without  an  intention  of  hav- 
ing any  wheat  pass  from  one  party  to  the 
other,  but  with  an  understanding  that  at 
the  appointed  time  the  purchaser  is  merely 
to  receive  or  pay  the  difference  between  the 
contract  and  the  market  price,  is  another 
thing,  and  such  as  the  law  will  not  sustain. 
This  is  what  is  called  a  setTliug  of  the  dif- 
ferences, and  as  such  is  clearly  and  only  a 
betting  upon  the  price  of  wheat,  against 
public  policy,  and  not  only  void,  but  de- 
serving of  the  severest  censure." 

This  question  was  fully  discussed  by  Ag- 
new,  J.,  who  delivered  the  opinion  of  the 
court  in  Kirkpatrick  v.  Bonsall.  '72  Pa.  St. 
155,  where  the  court  held  a  certain  contract 
was  not,  on  its  face,  a  gambling  contract, 
but  that  its  character  might  be  weighed,  in 
connection  with  other  evidence,  on  the  ques- 
tion that  the  transaction  was  a  gambling 
scheme.  The  court  said  a  bargain  for  an 
.option  may  be  legitimate  and  for  a  proper 

VANZILE  SEL.CAS.S,\I>ES — 20 


business  object.  "But  it  is  evident  such 
agreements  can  be  readily  prostituted  to  the 
worst  kind  of  gambling  ventures,  and  ther.-- 
fore  its  character  may  be  weighed  by  a  ju- 
ry in  connection  with  other  facts  in  consid- 
ering whether  the  bargain  was  a  mere 
scheme  to  gamble  upon  the  chance  of  prices. 
The  form  of  the  venture,  when  aided  by 
evidence,  may  clearly  indicate  a  puri»ose  to 
wager  upon  a  rise  or  fall  in  the  price  of  oil 
at  a  future  day,  and  not  to  deal  in  the  arti- 
cle as  men  usually  do  in  that  business.  We 
must  not  confound  gambling,  \vhether  it  be 
in  coi'poration  stocks  or  merchandise,  witli 
what  is  commonly  termed  'speculation.' 
Merchants  speculate  upon  the  future  prices 
of  that  in  which  they  deal,  and  buy  and 
sell  accordingly.  ♦  *  *  xheir  speculations 
display  talent  and  forecast,  but  they  act  up- 
on their  conclusions,  and  buy  and  sell  in  a 
bona  fide  way.  Such  speculation  cannot  be 
denounced.  But  when  ventures  are  made 
upon  the  turn  of  prices  alone,  with  no  bona 
fide  intent  to  deal  in  the  article,  but  merely 
to  risk  the  difference  between  the  rise  and 
fall  of  the  price  at  a  given  time,  the  case 
is  changed.  The  purpose  then  is  not  to  deal 
in  the  article,  but  to  stake  upon  the  rise  or 
fall  of  its  price.  No  money  or  capital  is 
invested  in  the  purchase,  but  so  much  only  is 
required  as  will  cover  the  difference, — a  mar- 
gin, as  it  is  figuratively  termed.  Then  the 
bargain  represents  not  a  transfer  of  prop- 
erty, but  a  mere  stake  or  wager  upon  its  fu- 
ture price." 

See,  further,  Grizewood  v.  Blaue.  11  C.  B. 
520.  where  it  was  held  that  a  contract  to 
purchase  shares  of  stock  without  the  in- 
tention to  deliver  or  receive  them  was  a 
gaming  contract. 

In  Yerkes  v.  Salomon,  11  Hun.  473.  it  was 
said  that  the  authorities  were  abundant  up- 
on the  proposition  that,  if  neither  party  in- 
tended to  deliver  or  accept  shares^,  but  mere- 
ly to  pay  differences  according  to  the  ri.se  or 
fall  of  the  market,  the  contract  would  be  a 
gaming  one.  And  in  that  case  it  was  held 
to  be  error  to  exclude  a  question  asking 
what  the  intention  at  the  time  the  contracts 
were  made  was, — whether  to  tender  or  call 
stock,  or  merely  to  settle  upon  differences. 

It  is  clear  from  these  authorities  that  the 
form  of  the  contract  on  its  face  is  not  con- 
clusive, but  that  its  character  should  be  con- 
sidered by  the  jury  in  the  light  of  all  the 
surrounding  facts  and  circumstances,  in  or- 
der for  them  to  determine  whether  a  mere 
scheme  to  gamble  upon  prices  was  the  in- 
tention, or  an  actual  bona  fide  sale  of  grain 
to  be  delivered  at  the  time  mentioned. 

There  were  some  suspicious  facts  and  cir- 
cumstances in  this  case.  The  weight  there- 
of, or  the  proper  conclusion  to  be  arrived 
at  from  a  view  of  the  whole  case,  it  is  not 
for  this  court  to  determine.  The  whole  ca.se. 
iinder  proper  instructions,  should  have  been 
submitted  to  the  jury,  and  the  court  erred 
in  withdrawing  the  case  from  them.     There 


o06 


ILLEGAL  SALES. 


must,  therefore,  be  a  new  trial  ordered,  up- 
on Avliicli  the  case  maj  appear  in  one  of 
three  different  aspects: 

First.  If  the  parties  acted  in  good  faith, 
and  the  agreement  made  contemplated  an 
actual  purchase  and  delivery  of  grain,  and 
such  a  purchase  was  in  fact  made,  then  the 
amount  paid  by  plaintiffs  in  error  to  cover 
any  loss  which  defendants  might  suffer  or 
become  responsible  for  on  account  of  a  de- 
cline in  the  price  or  value  of  the  grain  pur- 
chased cannot,  to  the  extent  of  such  loss, 
be  recovei'ed  back. 

Second.  If,  under  the  agreement  made, 
neither  party  contemplated  or  intended  that 
any  grain  should  in  fact  be  purchased  or  de- 
livered, but  that  at  the  time  mentioned  for 
delivery  the  difference  between  the  contract 
and  tlie  market  price  should  be  paid  to  the 
person  entitled  to  receive  the  same,  such 
agreement  being  void  as  against  public  poli- 
cy, and  both  parties  being  equally  in  the 
wrong,    the   law    would  afford   no   assistance 


to  either,  and  the  amount  paid  over  as  a 
margin  could  not  be  recovered  back. 

Third.  If  plaintiffs  in  error,  acting  in  en- 
tire good  faith,  authorized  defendants  to 
purchase  grain  for  them,  to  be  delivered  at 
a  future  date,  contemplating  and  intending 
that  an  actual  purchase  of  grain  and  a  de- 
livery thereof  to  them  would  be  made,  but 
the  defendants,  without  being  induced  by 
plaintiffs'  action  into  any  misunderstand- 
ing, did  not  in  fact  make  or  cause  to  be 
made  an  actual  bona  fide  purchase  of  grain, 
but  acted  upon  the  theory  that  the  differ- 
ence in  price  only  should  be  accounted  for 
and  paid,  then,  and  under  such  circumstan- 
ces, plaintiffs,  upon  discovery  of  such  facts, 
would  have  a  right  to  repudiate  what  had 
been  done,  and  recover  back  the  amount  by 
them  advanced  or  paid  over  to  the  defend- 
ants. 

.Judgment  reversed,  with  costs,  and  a  new 
trial   ordered. 

The  other  justices  concurred. 


ILLEGAL  SALES. 


yo7 


MOIUILSSEY  V.  BROOMAL  et  al. 
(50  N.  W.  383,  37  Neb.  7G6.) 
Supreme  Court  of  Nebraska.     Oct.  4,  1893. 
Commissioners'  decision.    Appeal  from  dis- 
trict court,  Lancaster  coiinty;  Hall,  .Tudjie. 

Action  by  John  C.  Morris-^ey  against 
George  Broomal  and  others  for  an  injunction 
and  other  relief.  Defendants  had  decree, 
and  plaintiff  appeals.     Affirmed. 

G.  M.  Lambertson,  for  appeUaut.  Lamb, 
Ilicketts  &  Wilson,  for  appellees. 

RAGAN.  C.  :\Iarch  1,  1889,  appellant  was 
a  grain  dealer  in  Nebraska,  and  appellees 
were  commission  merchants  in  Chicago,  111. 
These  parties  entered  into  a  written  con- 
tract bearing  said  date,  in  words  and  fig- 
m-es  as  follows:  "This  agreement,  made  this 
first  day  of  March,  1889,  by  and  between 
Wanzer  &  Co.,  of  Chicago,  111.,  of  the  first 
part,  and  J.  C.  Morrissey,  of  Lincoln,  Ne- 
braska, of  the  second  part,  witnesseth  as 
follows:  Wanzer  &  Co.  agree  to  loan  to 
said  Morrissey  a  sum  not  exceeding  th'rty 
thousand  dollars,  to  be  used  in  the  pur- 
chase of  corn  and  other  gi'ain.  seeds,  etc.. 
in  the  state  of  Nebraska,  the  rate  of 
interest  on  the  same  to  be  seven  per 
cent,  per  annum,  to  be  charged  montlily, 
as  said  Morrissey's  indebtedness  may  ap- 
pear. Said  Morrissey  agrees  to  give  his 
promissory  notes  at  30,  GO.  and  90  days,  to 
be  renewed  from  time  to  time,  as  may  be 
necessary,  for  the  entire  sum  so  loaned,  to- 
gether with  crib  or  warehouse  receipts  rep- 
resenting all  the  gi-ain  pm'chased  with  such 
funds,  or  other  grain  or  produce  of  fullj' 
equal  value.  Said  Morrissey  fm'ther  agrees 
to  sell  through  said  Wanzer  &  Co..  for  fu- 
ture delivery  in  the  Chicago  market,  corn 
equal  to  the  amount  of  ear  corn  purchased 
with  funds  fiu-nished  by  Wanzer  &  Co., 
which  sales  may  be  charged  from  month  to 
month,  as  may  be  directed  by  said  Z\Iorris- 
sey.  For  the  pm'chase  and  sale  of  this  grain 
said  Morrissey  agrees  to  pay  Wanz!>v  &  Co. 
one-sixteeuth  of  one  cent  por  Irasliol  per 
month  on  all  corn  on  hand  at  the  close  of 
each  and  every  month,  which  shall  cover 
the  charge  of  changing  from  month  to 
mouth;  and  if  pm-chases  and  sales  of  this 
character  are  made  in  any  month  in  excess 
of  the  amount  of  corn  on  hand,  the  charge 
of  such  piu'chase  and  sale,  or  sale  and  pm*- 
chase,  shall  also  be  one-sixteenth  of  one 
cent  per  bushel.  Said  IN'^orrissey  agrees  to 
ship  to  Wauzer  &  Co.  a.  ^rain,  seeds,  and 
other  produce  pm-chased  b^'  him;  Wanxer  & 
Co.  to  sell  the  same  in  the  Cliicngo  market 
in  such  manner  as  in  their  judgment  shall 
best  serve  the  interests  of  said  Morrissey, 
and  the  commission  charge  for  such  serv- 
ice shall  be  one-half  cent  per  bushel  for 
corn,  and  for  all  other  gi'ain  or  produce  one- 
half  the  rates  provided  for  by  the  rules  of 
the  Chicago  Board  of  Trade  for  the  ship- 
aieut  of  nonmembers  of  said  board  of  trade: 


provided,  however,  that  said  Morrissey  shall 
have  the  privilege  of  selling  such  grain  on 
track  or  of  shipping  it  to  other  markets, 
having  first  obtained  the  written  consent  of 
said  Wanzer  &  Co.,  said  Morrissey  to  pay 
to  Wanzer  «&  Co.  the  sum  of  $2.00  per  car  on 
every  car  of  gi*ain  or  seed  or  produce  sliipped 
by  him  or  his  agents  during  the  life  of  tliis 
coiUract,  and  not  liandled  by  said  Wanzer 
&  Co.,  which  .$2.00  per  car  shall  be  in  li.'u  of 
the  one-half  cent  per  busliel  above  prov;  U'd 
for.  Said  Morrissey  sliall  make  a  full  state- 
ment at  the  close  of  each  calendar  month  of 
the  amount  of  the  gi'ain  on  hand  and  the 
amount  of  grain  sold  or  shipped  bj-  him  dur- 
mg  that  month  other  than  to  Wanzer  &  Co., 
and  on  receipt  of  said  statement  of  Wanzer 
&  Co.  shall  make  the  charges  provided  for 
in  this  agreement.  Said  Morrissey  shall  al- 
so fm'uish  to  said  AVanzer  &  Co.,  on  tlieir 
request,  a  full  and  unreserved  statement  of 
his  financial  condition,  as  tliey  may  de- 
mand from  time  to  time.  Besides  such  smus 
of  moneys  as  are  above  provided  for,  AVan- 
zer  &  Co.  agree  to  pay  drafts  attached  to 
negotiable  bills  of  lading  to  nearly  the  value 
of  the  property  so  represented.  Said  Wan- 
zer &  Co.  agree  to  report  daily  all  sales  of 
property  for  account  of  said  Morrissey.  and 
to  furnish  him  with  such  information  as 
.le  may  request  concerning  such  sales,  and 
to  make  all  returns  as  promptly  as  possilile. 
Said  Morrissey  further  agi-ees  to  pay  inter- 
est on  all  sums  Wanzer  &  Co.  may  dep.isit 
as  margins  on  transactions  made  in  his  be- 
half, and  said  Wanzer  &  Co.  shall  notify  said 
Morrissey  of  the  deposit  of  said  margin. 
This  contract  shall  be  terminated  on  the  first 
day  of  March.  1890,  Wanzer  &  Co.  reserving 
the  right  to  terminate  the  same  by  giving  30 
days'  written  notice;  and  on  the  termination 
of  this  contract,  eitlier  by  such  notice  or  al 
the  expiration  of  the  time  hei'ein  agreed,  sai<l 
Wanzer  &  Co.  shaU  be  entitled  to  collect 
from  said  Morrissey  a  sum  equal  to  one-half 
■^ho  charges  said  Wanzer  &  Co.  would  re- 
ceive on  the  grain  said  Morrissey  shall  tlien 
have  on  liand.  according  to  the  aforenauied 
rates  in  this  contract.  J.  C.  Morrissey. 
Wanzer  &  Co." 

Under  this  contract  appellees  advanced  ap- 
pellant $19,7.j0.  for  which  appellant  gave  his 
notes,  secured  by  warehouse  or  crib  receipts 
on  grain  stored  in  his  el'evators  in  Nebraska. 
In  .lauuary,  1S90,  appellees  held  a  note  of 
appellant  for  $2,000,  dated  March  15,  1889, 
due  GO  days  after  date,  on  which  there  was. 
due  and  impaid  $1,230,  and  some  interest., 
to  secm-e  the  payment  of  which  api)ellees; 
held  certain  warehouse  or  crib  receipts  is- 
sued to  them  by  the  appellant  on  gi-ain  in 
his  elevators.  At  this  date— January,  1890 
— appellees  sent  this  note  and  the  crib  re- 
ceipts to  a  bank  in  Lincoln,  Neb.,  for  col- 
lection. It  appears  that  while  the  bank 
held  the  note  and  warehouse  receipts,  appel- 
lant brought  this  action  in  the  district  court 
of  Lan;-r.ster  county  to  enjoin  the  appellees. 


308 


ILLEGAL  SALES. 


aud  the  bank  from  transferrins  or  dispos- 
al.:? of  the  viiirehouse  receipts,  and  from  tak- 
ing; possession  of  the  ^rain  covered  by  them, 
and  to  cancel  said  securities.  Appellees  filed 
a  cro.^s  pi'tition  in  this  action,  setting  out  the 
contract  above,  the  fjivingr  to  them  by  appel- 
lant of  the  note  and  crib  receipts  to  secure 
the  payment  of  the  same,  and  that  the  note 
was  unpaid,  and  prayed  fu:-  an  accounting  of 
the  amoimt  due  on  it,  and  a  foreclosure  of 
their  lien  on  the  ta'ain,  auil  a  sale  of  the 
same  to  satisfy  the  amoiint  found  due.  Ap- 
pelMnt  then  dismissed  his  injunction  suit, 
and  tiled  an  answer  to  appellees'  cross  .peti- 
tion, which,  after  admitting  Ihe  execution  of 
the  contract  and  note  and  crib  receipts,  set 
out  the  following  defenses:  (a)  A  general  de- 
nial of  the  averments  of  the  cross  petition, 
(b)  That  the  crib  receipts  sourht  to  be  fore- 
closed had  been  satisfied  by  grain  shipped 
and  money  remitted  by  the  appellant  to  ap- 
pellees according  to  the  terms  of  the  con- 
tract, and  that  the  gi-ain  so  shinned  was 
grain  piu*chased  v.itli  the  money  borrowed 
by  the  appellant  of  the  appellees  and  the 
money  remitted  was  proceeds  derived  from 
the  sale  of  the  gi-aiu  purchased  with  the 
money  borrowed  of  the  appellees,  and  that 
appellant  had  no  grain  in  his  possesriou  cov- 
ered by  said  warehouse  receipts,  (c)  That 
the  appellant  was  financially  responsible, 
and  therefore  appellees  had  a  complete  and 
adequate  remedy  at  law,  and  that  the  court 
was  without  equitable  jurisdiction,  (d)  That 
the  contract  between  the  parties,  and  the 
notes  executed  in  pursuance  thereof,  were 
u-suiious.  (e)  That  "the  contract  is  illegal 
and  void,  having  been  made  in  Anolation  of 
the  law,  and  against  public  policy,  in  so  far 
as  the  plaintiff  agrees  to  make  good  any 
margins  advanced  by  the  defendants  on 
grain  bought  or  sold  for  future  delivery  on  the 
board  of  trade,  *  *  *  the  same  being  a 
•gambling  contract."  (f)  A  counterclaim  that 
fippellant  was  induced  to  sign  the  "contract 
Avith  the  belief  and  the  understanding  and 
agreement  that  the  same  should  continue  in 
force  for  one  year  from  its  date,  and  with 
the  understanding  and  agreement  then  had 
and  with  the  understanding  and  )gi-eement 
subsequently  had  with  the  defend  mts  that 
said  contract  shoiiM  continue  in  force  one 
year  from  its  date;  *  *  *  and  the  plaintiff 
avers  that  notwithstanding  said  clause  au- 
thorizing said  forfeitm-e  of  said  con.ract  at  th' 
option  of  tlie  defendants  on  thirty  da.vs'  notic. 
was  in  said  contract  at  the  date  of  its  execu- 
tion, yet  it  was  then  a.gi-eed  and  unr'.erstood 
by  and  between  the  plaintiff  and  defendants 
that  said  clause  should  have  no  force  and 
effect;  *  *  *  that  the  plaintiff  contin- 
ued to  do  business  with  the  defendants  un- 
til about  the  ISth  of  Novenil)er,  1889,  when 
the  said  defendants  arbitrarily,  unjustly, 
and  without  any  good  cause  or  reason  noti- 
jii'd  the  said  plaintiff  that  said  contract 
would  be  forfeited  on  or  about  the  20tli  day 


of  December,  18S9:  *  *  *  and  by  rea- 
son of  the  notice  of  said  defepdants  that 
said  contract  was  terminat(>d,  and  tlieir  re- 
fusal to  carry  it  into  effect  and  advance 
said  moneys  for  one  year,  as  understood 
and  agreed  between  the  plaintiff  and  defend 
ants,  and  by  reason  of  the  defendants'  re- 
call of  all  the  moneys  advanced  and  l«Kined. 
said  plaintiff  was  damaged  in  his  business 
and  credit  and  put  to  great  expense  in  the 
sum  of  .$10,000."  The  prayer  of  this  an- 
swer was  that  the  cross  petition  of  th<' 
appellees  might  be  dismissed,  and  the  ap- 
pellant m  -vht  have  such  other  relief  as  in 
equity  and  good  conscience  the  court  might 
find  him  entitled.  To  this  answer  appellees 
tiled  their  reply,  denying  all  the  allegations 
of  new  matter  in  the  answer.  Theie  was  a 
trial  to  the  court,  who  found  all  the  issues 
in  favor  of  the  appellees,  but  found  that  ap- 
pellant had  sold  and  shipped  the  identical 
grain  covered  by  the  crib  receipts,  and  the 
court  rendered  a  personal  judgment  against 
the  appellant  for  the  amount  due  on  the 
note. 

When  the  issues  were  complete,  appellant 
moved  the  com't  to  transfer  the  case  to  the 
law  docket,  and  impanel  a  juiy  for  the  trial 
of  the  case.  This  motion  the  court  over- 
ruled. When  the  trial  was  about  to  be.gin, 
appellant  again  moved  the  com't  for  a  jui'y 
trial  on  the  issues  of  the  facts  involved  in 
the  case.  This  motion  the  court  overruled. 
The  overruling  of  these  motions  is  the  first 
complaint  made  by  the  appellant  here. 
Whether  tliis  rulin.g  of  the  com-t  was  correct 
depends  upon  the  natm'e  of  the  issues  made 
by  the  pleadings,  and  the  character  of  the 
relief  demanded.  Tlie  cross  petition  alleged 
the  making  and  delivery  by  the  appellant  to 
appellees  of  a  note  and  certain  warehouse 
receipts  on  grain  in  his  elevatoi*s  to  secm'e 
the  payment  of  the  note;  that  the  note  was 
past  due  and  unp:iid.  Appellees'  prayer 
was  for  a  foreclosure  of  the  liens  on  the 
gi'ain.  and  a  decree  for  its  sale  to  pay  the 
;r»uount  due  on  the  note.  The  answer  ad- 
mitted the  execution  of  the  notes  and  secu- 
rities, but  alleged  that  the  liens  or  crib  re- 
ceipts had  been  discharged;  that  the  note 
was  usurious;  that  the  contract  out  of 
which  the  subject-matter  of  the  claim  in  the 
cross  petition  grew  was  void,  being  a  gam- 
bling contract;  that  said  contract,  as  writ- 
ten, was  not  as  agreed  and  understood  by 

he  parties;  and  there  was  a  prayer  for  a 
reformation  of  it.  The  cross  petition  de- 
manded eqiiitable  relief  only.  It  invokeci 
the  equity  powers  of  the  court,  and  the  is- 
sues made  by  the  cross  petition,  the  answer 
of  the  appellant  thereto,  and  the  reply  of  the 
appellees  were  entirely  equitable;  but  ap- 
IH-Ilaut  also  alleged  by  way  of  counterclaim 
in  his  answer  that  he  had  been  damaged  $10,- 
uuo  by  the  wrongful  termination  of  the  con- 
tract by  the  appellees.  Did  this  counter- 
claim of  the  appellant  for  damages  oust  the 
coiirt  of  its  equitable  jurisdiction?  Is  a  de- 
fendant to  a  purely  equitable  suit  entitled  an 


ILLEGAL  SALES. 


309 


a  matrer  of  rijsrht  ami  law  to  a  jury  for  the 
trial  of  an  issue  of  law  which  he  has  volun- 
tarily broxiglit  into  the  case?  We  think 
not.  The  appellant  had  a  rij;ht.  if  he  was 
so  minded,  to  llle  his  connterelaim  for  dam- 
ages in  this  equity  suit.  It  was  an  inde- 
pendent cause  of  action  existing  in  his  fa- 
vor and  against  appellees,  but  apnellant's 
cause  of  action  on  his  coimterclain.  >vas  not 
lost  to  him  or  baiTed  had  he  left  [i*^  out  of 
this  suit.  The  action  as  made  by  the  ap- 
pellees in  their  cross  petition  was  one  pure- 
ly of  eqiiitable  c«;gnizance;  but  part  of  the 
relief  demanded  by  the  appellant  could  only 
oe  granted  by  a  coxu't  of  equity.  The  famil- 
iar principle  is  that  when  a  court  of  equity 
acquires  juris^liction  over  a  cause  for  any 
pui'pose  it  may  retain  the  cause  for  all  pm- 
poses,  and  proceed  to  a  final  determination 
of  all  the  mattters  put  at  issue  in  the  case. 
1  Pom.  Eq.  Jiu".  §  ISl,  and  cases  cited.  In 
Wilson  V.  Johnson.  74  ^^'is.  337,  43  X.  W. 
Kep.  148,  it  is  said:  "An  action  tc»  enforce 
a  lien  upon  a  pledge  is  an  eciuitable  one, 
triable  by  the  court."  In  Loan  Co.  v.  Wen;- 
worth,  2.J  Pac.  Rep.  298.  the  supreme  coui'i 
of  AVashington  say:  "As  the  foreclosure  ot 
a  mechanic's  lien  is  a  proceeding  cognizable 
in  a  court  of  equity,  the  mere  fact  that  the 
defendant  in  such  suit  interposes  a  comiter- 
claim  for  damages,  as  he  is  allowed  to  do 
by  the  laws  of  Washington,  is  not  sutticient 
to  divest  such  court  of  its  .Imnsdiction,  anCi 
to  entitle  the  defendant  to  demand  a  trial 
by  jm-y."  This  com-t  said  in  Dolile  v.  Ma- 
chine Co.,  15  Neb.  43G.  19  X.  \\'.  Kep.  »J4i, 
that  "an  action  to  foreclose  a  mechanic's  lien 
is  essentially  a  suit  in  equity,  and  a  party 
is  not,  as  a  matter  of  right,  entitled  to  a 
juiy  trial  therein."  See,  also,  Gormley  v. 
Clark.  134  U.  S.  :i3S.  10  Sup.  Ct.  Rep.  .",4; 
Ryman  v.  Lynch,  76  Iowa,  587.  41  X.  W.  Rep. 
320.  After  the  evidence  was  in,  it  appeared 
that  the  grain  called  for  by  the  warehouse 
receipts  sought  to  be  foreclosed  had  been 
ah'eady  disposed  of  by  the  appellant,  and 
his  counsel  now  contends  that  the  court 
should  have  then  impaneled  a  ^ury.  But 
this  position  is  untenable.  The  com't  was 
sitting  in  equity.  It  had  before  it  on  the 
pleadings  an  equitable  action,  and  it  did  not 
lose  its  jurisdiction  because  the  evidence  dis- 
closes that  the  only  adequate  relief  it  could 
afford  was  a  persomU  juilgment.  Van  Rens- 
selaer V.  Van  Rensselaer,  113  X.  Y.  207,  21 
X.  E.  Rep.  75.  The  com't  was  right  in  re- 
fusing the  appellant  a  jury  trial. 

The  contract  between  the  appellant  and 
appellees  contained  this  clause:  "This  coii- 
tract  shall  be  terminated  on  the  first  day  ot 
^Nlarch,  1890,  Wanzer  &  Co.  reserving  the 
right  to  terminate  the  same  by  giving  thirty 
days"  written  notice;  and  on  the  termina- 
tion of  this  contract,  either  by  such  notice 
or  at  the  expiration  of  the  time  herein 
agreed,  said  Wanzer  &  Co.  shall  be  entitled 
to  collect  from  said  Morrissey  a  sum  ecpial 
to  one-half  the  charges  said  Wanzer  &  Co. 
would  receive  on  the  grain  s^xid   Morrissey 


1  shall  then  have  on  hand,  according  to  the 
aforenamed  rates  in  this  contract."  On  Xo- 
vember  18,  1889,  appellees  notified  appellant 
in  writing  of  their  election  to  terminate  saii; 
contract  on  December  20,  1889,  and  on  said 
last  date  appellees  terminated  the  contract 
The  appellant's  next  point  is  that  the  con- 
tract between  him  and  the  appellees  was  to 
continue  in  force  tmtil  March  1,  1890,  noi- 
withstanding  the  agreement  therein  that  the 
appellees  might  terminate  it  sooner.  Appel- 
lant bases  this  contention  on  an  agreement 
which  he  alleges  existed  between  himsilr 
and  appellees  to  that  effect,  outside  of  the 
instrument  itself.  The  court  found  this  is- 
sue against  the  appellant,  and  rightftilly  so. 
We  cannot  stop  here  to  quote  tlie  coitc- 
spondenee  between  the  parties  leading  up  to 
the  execution  of  this  agreement,  but  it  set- 
tles beyond  all  doubt  that  the  contract  as 
signed  and  as  it  exists  is  in  all  resjjccts  as 
all  parties  thereto  understood  it  at  the  time 
of  its  execution.  The  evidence  shows  that 
the  appellees  refused  absolutely  to  contract 
with  appellant  on  any  terms,  unless  the 
right  to  terminate  the  contract  on  30  days' 
notice  was  reserved  to  them  in  the  instru- 
ment. There  was  much  correspondence  be- 
tween the  parties  on  this  very  clause,  prior 
to  the  execution  of  the  contract;  and  it  is 
a  waste  of  words,  in  the  face  of  this  record, 
to  say  that  appellant  did  not  Ivnow  that  the 
right  to  terminate  the  agi'eement  was  re- 
served, or  that  there  was  any  agi'eement  or 
understanding,  even  on  appellant's  part,  that 
the  contract  should,  at  all  events,  run  to 
March.  1890.  Appellant  contends,  however, 
that  notwithstanding  the  clause  in  the  agree- 
ment reserved  to  appellees  the  right  to  ter- 
minate it  on  giving  30  days'  notice,  the  con- 
tract could  not,  as  a  matter  of  law.  be  thus 
terminated.  We  do  not  so  understand  the  hi w. 
•When  the  right  to  terminate  a  contract  on 
notice  is  reserved  without  any  fraud  or  mis- 
take, but  with  the  actual  knowledge  and 
consent  of  all  parties  to  the  agreement,  it 
is  as  valid  in  law  as  any  other  clause  of  the 
instrument;  and  the  coiu'ts,  when  called  up- 
on, will  enforce  it,  unless  to  do  so  would 
be  manifestly  contrary  to  equity  and  good 
conscience.  In  Ireland  v.  Dick,  18  Atl.  Rep. 
735.  the  supreme  court  of  Pennsylvania  say: 
''The  appellants  accepted  a  license  from  tlK- 
appellees  for  the  manufacture  of  drilling 
jars.  *  *  *  The  agreement  was  in  writ- 
ing; that  is,  it  was  a  printed  form,  filled  in 
as  to  names,  dates,  etc.,  in  writing,  and 
with  the  addition  in  the  right-hand  margin 
of  the  following  stipulation:  'It  is  agreed 
by  the  parties  of  the  first  part  that  the  par- 
ties of  the  second  part  can  cancel  this  license 
by  giving  thirty  days'  notice  in  writing.' 
This  portion  of  the  instrument  *  *  *  is 
presumed  to  express  the  exact  agreement  or 
the  parties  upon  the  subject.  Both  of  the 
parties  acted  under  the  agreement  imtil  De- 
cember 19,  1878,  when  the  licensees  under 
the  written  clause  *  *  *  sent  a  notice  to 
the  licensors  in  the  following  terms:     'We 


1310 


ILLEGAL  SALES. 


wish    to   caucol    our   liconso   concerning   the   | 
manufacture  of  drilling  jars    *    *    *    as  per   | 
contract.'     It  is  entirely  clear  that  this  let- 
ter was  an  absolute  and  complete  rescission 
of  the  agreement." 

The  district  court  found  that  the  appel- 
lant was  not  entitled  to  recover  any  damages 
from  th'>  appelkH'S  by  rea.son  of  their  hav- 
ing terminated  the  contract,  and  that  find- 
ing is  the  ne.vt  in  order  of  appellant's  com- 
plaints; and  this  claim  for  damages  is  based 
solely  on  the  assumption  that  the  appellees 
violated  their  contract  with  the  appellant. 
But  did  ilioyV  The  contract  was  terminated 
in  accordance  with  its  provisions.  There  is 
no  evidence  tending  to  show  that  it  was  ter- 
minated by  the  apiiellees  for  a  sinister  pnr- 
po.«e,  nor  that  in  exercising  their  right  to 
terminate  it  they  acted  maliciously  or  arbi- 
tranly.  IntU-ed,  the  evidence  would  support 
a  tinding  that  the  appellant's  own  violation 
of  the  conti-act  afforded  sntficient  grounds 
for  its  teriuination  by  the  appellees,  had 
the  contract  by  its  terms  required  the  ex- 
istence of  such  grounds  as  a  prerequisite  ro 
the  right  of  the  appellees  to  terminate  it.  The 
evidence  shows  that  the  appellees,  however, 
in  no  respect  violated  either  the  letter  or 
spirit  of  the  contract;  nor  has  the  appel- 
lant sustained  any  damages  by  rea.son  of 
its  termination  for  which  appellees  can  be 
made  liable.  The  losses,  if  any,  sulTered  by 
the  appellant  in  consequence  of  the  termina- 
tion of  the  agreement,  were  such  only  as  he 
must  have  known,  when  he  signed  the  con- 
tract, might  ensue  if  it  should  be  terminated 
according  to  its  provisions. 

The  appellant  also  claims  that  the  court's 
finding  that  the   contract  between  the  par- 
ties thereto   was  not  usurious  is   erroneous. 
By  the  terms  of  the  contract  appellant  wai5 
to   pay    7   per    cent,    interest   on   all    money 
loaned  him  by  the  appellees,  th(»  money  bov; 
rowed  to  be  used  in  the  purchase  of  grain. 
Appellant  was  to  pay  appellees  a  comm..s.-jion 
of  one-half  of  one  cent  per  bushel    for  selling 
grain  shipped  to  them  and  .$2  per  car  on  divert-   ; 
ed  shipments;    that  is,  for  all  grain  he  shipped 
to    others   than    appellees,    and    which    grain  ' 
had   been  purchased   with   money    furni.slied 
by  them.    Appellant  was  also  to  sell  througli 
the  appellees,  for  future  delivery  in  Chicago 
market,    com   to   equal    the   amount    of   ear 
corn   purchased   by    the   appellant    with    the  ; 
money    borrowed;      and    for    making    these 
sales    appellant    was    to   pay   appellees    one-  | 
sixteenth  of  one  cent  per  bu.shel  on  all  com  l 
appellant  had  on  hand  at  the  close  of  each  j 
month.    Appellant  now  contends  that  as  the  j 
amount  paid  ;ippellees  on  diverted  shipments,   j 
."?412,    the    aujount   paid    for    comniis,sion    on   j 
sales  for  future  delivery,  $189.24,  added  to 
the    amount    paid    as    interest,    $788.48.— ex- 
ceeded   10   per  cent,  .interest  on   the   money   | 
during  the  time  it  was  loaned;    that,  there- 
fore, the  agreement  was  usurious.    The  con-  I 
tract  is  not  on   its  face  necessarily   a   usu- 
rious  on«.    Appellees    were    engaged    in    the 
buying  and  selling  of  grain  on  commission, 


and  had  a  right  to  lend  their  money  at  law- 
ful rates  of  interest  to  such  parties  and  on 
such  terms  as  would  probably  increase  their 
commission  business,  and  out  of  Avhich  in- 
crease they  might  derive  additional  proht. 
The  circumstance  that  their  profits  growing 
out  of  the  transaction  covered  by  the  con- 
tract exceeded  the  legal  rate  of  interest  on  the 
amount  of  money  actually  embarked  in  the 
enterprise  does  not  afford  conclusive  proof 
that  the  agreement  was  in  fact  a  usurious 
one.  At  the  most,  this  circumstance  was 
evidence  tending  to  show  that  the  inten- 
tion of  the  parties  was  to  make  the  contract 
a  cover  for  u.surious  transactions.  The  ques- 
tion is:  Were  these  charges  for  diverted 
shipments  and  for  making  sales  for  future 
delivery  honestly  so  intended  by  the  parties 
as  compensation  for  such  services,  or  were 
these  charges  invented  as  a  cover  for  usury? 
This  was  a  question  of  fact  for  a  trial  court 
to  determine.  He  has  found  that  the  ti*ans- 
actions  were  not  usurious  ones,  and  the  evi- 
dence supports  that  finding.  Cockle  v. 
Flack,  03  U.  S.  344;  Beckwith  v.  Manu- 
facturing Co.,  14  Conn.  .594. 

Finally,  it  is  said  by  the  appellant  that  the 
contract  between  him  and  the  appellees  was 
a  gambling  contract,  and  void.  If  this  is 
so,  it  must  appear  either  from  the  instini- 
ment  itself  or  from  the  transactions  of  the 
parties  under  it.  The  expressions  in  the  con- 
tract which  it  is  alleged  show  it  a  gambling 
contract  on  its  face  are  as  follows:  "Said 
Moi-riss(^y  further  agrees  to  sell  througli  said 
Wanzer  &  Co.,  for  future  delivei-y  in  the 
Chicago  market,  corn  equal  to  the  amount 
of  ear  corn  purchased  with  funds  furnished 
liy  Wanzer  &  Co.,  which  sales  may  be 
changed  from  mouth  to  month,  as  may  be 
directed  by  said  Morrissey.  For  the  pur- 
cliase  and  sale  of  this  com  said  Morrissey 
agrees  to  pay  said  Wanzer  &  Co.  one-six- 
teenth of  one  cent  per  bushel  per  month 
on  all  corn  on  hand  at  the  close  of  each 
and  every  month,  which  shall  cover  the 
charges  of  change  from  month  to  month; 
and,  if  piurhases  and  sales  of  this  charac- 
ter are  made  in  any  month  in  excess  of  the 
corn  on  hand,  the  charge  of  such  purchase 
and  sale,  or  sale  and  purchase,  shall  also 
be  one-sixteenth  of  one  cent  per  bushel. 
Said  Morrissey  further  agrees  to  pay  inter- 
est on  all  sums  said  Wanzer  «&  Co.  may  de- 
posit as  margins  on  transactions  in  his  be- 
half, and  said  Wanzer  &  Co.  shall  notify 
said  Morrissey  of  the  deposit  of  said  mar- 
gins." The  substance  of  the  fii-st  quotation 
is  that  the  appellant  would  sell  through  ap- 
pellees, in  the  Chicago  market,  for  future 
delivery,  as  much  corn  as  appellant  pur- 
chased with  the  money  borrowed  of  the 
appellees;  in  other  words,  it  was  an  agree- 
ment to  sell  gniin  for  future  delivery.  "The 
sale  of  grain  for  deliveiy  in  the  future  is  a 
valid  contract."  Gregory  v.  Wendell,  39 
Mich.  337.  "If  a  party  has  property  under 
his  control  he  has  a  right  to  sell  it  to  be 
delivered    at   a    future     time."     Sanborn    v. 


ILLEGAL  SALES. 


311 


Benedict,  78  111.  309.  "Tlio  pnrclia.<e  of  grain 
at  a  certain  price  per  bnshel.  to  be  delivered 
in  the  future,  is  not  an  illegal  or  gambling 
contract."  Pixley  v.  Boyuton,  79  111.  351; 
Irwin  V.  Williar,  110  U.  S.  499,  4  Sup.  Ct. 
IJej).  IGO.  "The  validity  of  option  contracts 
depends  upon  the  mutual  intention  of  the 
parties.  If  it  is  not  the  intention  in  making 
tlie  contract  that  any  property  shall  be  de- 
livered or  paid  for,  Imt  tliat  lictitioxis  sales 
shall  be  settled  on  difference,  the  contract 
is  illegal;  but  if  it  is  the  good-faith  intention 
of  the  seller  to  deliver,  or  the  buyer  to  pay, 
and  the  option  consists  merely  in  the  time 
of  the  deliveiy.  AAithin  a  given  time,  the 
contract  is  valid,  and  the  putting  up  of 
margins  to  cover  losses  which  may  aecinie 
from  fluctuations  of  the  price  is  legitimate 
and  proper."  Bank  v.  Carr.  in  Fed.  Rep.  438, 
cited  in  Whitesides  v.  Hunt,  97  Ind.  191.  "A 
bona  tide  contract  for  the  actual  sale  of 
grain,  deliverable  M'ithin  a  specified  future 
montli,  *  *  *  is  not  a  gambling  contract." 
Wliite  V.  Barber,  123  U.  S.  392,  8  Sup.  Ct. 
Hep.  221.  "Contracts  for  future  deliveiy  of 
personal  property  which  the  vendor  does  not 
own  or  possess,  but  expects  to  obtain  by 
purchase  or  otherwise,  are  valid  if,  at  the 
time  of  making  tihe  contract,  an  actual 
transfer  of  the  property  is  contemplated  by 
at  least  one  of  the  parties  to  the  transac- 
tion." Bibb  V.  Allen.  149  U.  S.  481,  13  Sup. 
Ct.  Rep.  9.50.  It  seems  settled  from  the  fore- 
going autliorities  that  this  agreement  to  sell 
grain  for  future  delivery  is  not,  on  its  face, 
a  gambling  contract. 

The  substance  of  the  second  quc>tation  is 
that  the  appellant  agreed  to  pay  interest  on 
all  sums  of  money  appellees  might  advance 
for  him  as  margins  on  transactions  in  his 
behalf.  What  transactions?  Gambling 
transactions?  We  do  not  think  such  is  a 
fair  construction  of  the  language  of  this  in- 
strument. "Where  a  contract  is  capable  of 
two  constrtictions,  the  one  making  it  valid 
and  the  other  void,  the  law  will  adopt  the 
construction  that  upholds  the  contract." 
Whart.  Cont.  §  337.  To  say  that  this  clause 
shows  that  the  intention  of  the  parties  to  the 
contract  was  to  engage  in  gambling  'transac- 
tions in  grain  under  it  wotUd  be  a  forced 
construction  of  the  language.  "A  contract 
for  the  sale  of  grain  for  future  delivery  be- 
ing legal,  it  logically  follows  that  the  agree- 
ment of  the  appellant  to  pay  interest  on 
moneys  advanced  for  him  by  the  appellees 
to  protect  these  sales  against  the  fluctua- 
tions of  the  market  did  not  taint  the  con- 
tract with  the  vice  of  gambling."  Gru- 
man  v.  Smitli,  81  N.  Y.  25;  Gregory  v. 
Wendell,  39  Mich.  337.  In  Rudolf  v.  Win- 
ters, 7  Neb.  125,  this  court  said:  "A  contract 
to  operate  in  grain  options,  to  be  adjusted 
according  to  differeu':;^  in  the  market  value 
thereof,  is  a  contract  for  a  gambling  trans- 
action, which  the  law  will  not  tolerate." 
We  adhere  to  that  decision.  To  the  same 
effect,  see  Embrey  v.  .lemison.  131  U.  S.  33(3, 
9  Sup.  Ct.  Rep.  77u:  Sprague  v.  Warren.  2(J 


Xeb.  32G.  41  N.  W.  Rep.  1113;  Watte  v. 
A  ickersham,  27  Xeb.  457,  43  N.  W.  Rep.  259. 
iiut  the  contract  we  are  considering  does 
aot  come  within  the  rule  laid  down  by  those 
cases.  The  true  question  here  is  from  the 
terms  of  this  contract,  what  was  the  inten- 
tion of  the  parties  thereto?  Was  their  in- 
tention to  buy  and  sell  grain  upon  the 
market,  and  settle  the  differences  without 
any  delivery?  If  so,  the  contract  was  a 
gambling  one,  and  void.  But  to  render  a 
contract  invalid  it  must  appear,  either  from 
the  instrument  itself  or  from  the  evidence 
outside,  that  at  the  time  of  its  execution  the 
mutual  intent  of  the  parties  was  that  no 
deliveries  of  grain  should  be  made  under  it. 
i)ut  the  ditf  erence  in  the  price  paid.  We  are 
of  the  opinion  that  this  contract,  on  its  face, 
cannot  be  held  a  gambling  one. 

But  appellant  insists  that  if  this  agree- 
ment cannot  be  construed  from  its  text  to 
be  a  gambling  contract,  such  facts  never- 
theless appear  of  evidence.  We  cannot 
quote  all  the  testimony  to  this  point.  The 
appellees  testified  that  they  hud  no  inten- 
tion by  entering  into  this  contract  to  specti- 
late  or  gamble  in  the  price  of  grain.  The 
appellant  testified  as  follows:  "Question  by 
the  Court:  What  do  you  mean  by  •selling 
for  future  deMvery?'  Answer.  I  will  explain 
that  to  your  honor.  We  in  the  grain  busi- 
ness build  cribs  and  elevators  for  the  pur- 
pose of  getting  storage  out  of  om*  grain.  We 
buy  the  grain  from  the  farmer  in  November 
and  December  and  January,  dtn-ing  the  win- 
ter months,  when  there  is  good  storage 
charges.  The  winter  storage  is  generally 
about  4  cents  from  December  tiutil  May. 
*  *  *  Now.  whan  a  man  takes  and  fills 
a  crib  up  in  November  he  has  money  to  pay 
for  it,— he  has  money  to  pay  for  it  in  the 
bank.— and  he  don't  ship  it  out.  but  puts  it 
in  the  crib,  and  fills  the  cribs  up;  and  as  he 
fills  the  crib  he  wires  a  commis.-;ion  hotise 
in  Chicago,  "SeU  5.000  bushels  March  deliv- 
ery against  my  acttial  corn  in  crib.'  Q.  Then 
he  actually  intends  to  deliver  that  corn?  A. 
Yes,  sir.  Q.  Is  that  a  gambling  contract? 
A.  That  is  not  a  gambling  contract  when 
you  sell  corn  in  crib  for  future  delivery, 
when  you  have  the  actual  corn.  Q.  Was 
there  anything  of  that  kind  in  this  contract 
between  you  and  Wanzer  &  Co.?  A.  I  don't 
think  there  was  any  gambling  any  different 
from  selling  against  the  corn  which  was 
being  held  in  cribs.  A.  Anything  in  the  con- 
tract? A.  Not  on  my  part,  any  other  inten- 
tion than  that  I  went  into  this  contract  for 
to  get  the  storage  charges.  I  had  money 
enough  to  rim  this  business.  The  object 
was  to  put  the  corn  in  store,  and  get  the 
winter  storage  on  it.  *  *  *  Tliat  was 
the  inducement  for  going  into  that  con- 
tract." The  record  also  shov»'s  that  the  ap- 
pellant from  time  to  time  sold  for  future 
delivery  as  much  grain  as  he  had  on  hand, 
and  when  the  time  arrived  to  make  delivery, 
instead  of  shipping  the  grain  he  had  in  the 
cribs,  he  would  buy  grain  on  the  market  to 


r,i2 


ILLEGAL  SALES. 


fill  or  offset  the  sales  mfide,  and  resell  tlie 
j,a-ain  ou  hand  for  a  futiu'e  delivery.  These 
transactions,  or  rather  the  record  of  them, 
would  make  it  falsely  appear  that  the  appel- 
lant sold  very  much  more  corn  than  he  ever 
I)aid  for  during  the  time  of  the  transactions; 
and  it  is  this  feature  of  the  dealings  of  the 
parties  that  appellant's  counsel  claims  es- 
tablishes by  the  acts  of  the  parties  to  the 
contract  under  it  a  gambling  character.  But 
we  think  this  is  not  a  fair  deduction  from 
the  evidence.  It  shows  that  all  these  sales 
and  purchases  of  appellant  on  the  market 
were  based  on  grain  he  had  on  hand,  and 
that  this  seL'ing  and  buying  on  the  market 
was  not  dealing  in  options,  not  betting  on 
the  rise  and  fall  of  the  market,  but  pur- 
chases made  to  till  sales  he  had  previously 
made,  and  thus  obviated  the  necessity  of 
delivery  of  the  grain  he  had  in  his  cribs  in 
Nebraska.  The  case  of  Douglas  v.  Smith, 
74  Iowa,  468,  38  N.  W.  Rep.  163,  is  one  in 
which  the  facts  were  substantially  the  same 


as  in  the  case  at  bar.  and  that  court  said' 
"Where  country  grain  Iniyers  had  a  large- 
quantity  of  corn  in  cribs,  and  they  made 
sales  from  time  to  time,  through  Chicago 
commission  merchants^  for  future  delivery 
of  No.  2  corn,  but  fearing  tliat  their  corn 
would  not  grade  No.  2,  and  hoping  that  it 
would  imi)rove  with  age,  they  bought  in  and 
resold,  intending  to  deliver  the  corn  to  cover' 
their  sales,  held,  that  the  transactions  were 
not  illegal,  so  as  to  defeat  their  brokers  in 
the  collections  of  the  margins  advanced  for 
them."  The  facts  in  this  case  bi'ing  the 
transactions  of  the  parties  within  the  opera- 
tion of  the  decisions  of  the  case  last  above 
cited.  The  preponderance  of  the  testimony 
establishes  the  fact  that  the  sales  made  by 
the  appellant  were  not  wagers,  but  that  the 
grain  was  to  be  actually  delivered  at  the 
time  agreed  upon.  The  decree  of  the  dis- 
trict court  is  right,  and  the  same  is  in  all 
things  athrmed.  The  other  commissioners' 
concur. 


ILLEGAL  SALES. 


313 


WHITE   V.   BARBER   (two   cases), 

(S  Sup.  Ct.  221,  123  U.  S.  392.) 

Dec.  5,  1887. 

EiTor  to  the  cironlt  court  of  the  Unitofl  States 
for  the  Northern  district  of  Ilhnois.  and  appeal 
from  the  circuit  ^ourt  of  the  United  States  for 
the  Xortliern  district  of  Illinois. 

The  first  cue  of  these  cases  is  an  action  at 
law  brought  on  the  tenth  of  May,  l'-S3,  by 
James  B.  Wliite  ajraiust  George  M.  Barber,  in 
the  supei'ior  court  of  Cook  countj',  Illinois.  The 
declaration  demanded  the  siun  of  $1.">,000.  and 
declared  on  the  common  coimts.  The  defend- 
ant pleaded  non  assumpsit.  In  June,  188;^,  the 
cause  was  removed  by  the  defendant  into  the 
circuit  court  of  the  United  States  for  the  North- 
ern disti'ict  of  Illinois.  At  the  trial,  in  Feb- 
ruarj-,  1884,  there  was  a  verdict  for  the  de- 
fendant, followed  by  a  judgment  for  him,  to  re- 
view which  the  plaintiff  has  brought  a  writ  of 
error.  There  wj,s  a  bill  of  exceptions,  the 
Avhole  of  which  is,  in  substance,  as  follows: 

The  plaintiff  introduced  the  following  evi- 
dence: 

James  B.  White,  the  plaintiff,  testified  that 
now.  and  during  the  time  in  question,  hi  resided 
at  Fort  Wayne,  Indiana,  engaged  in  the  busi- 
ness of  dealing  in  general  merchandise;  that  in 
1879,  and  prior  thereto,  one  A.  S.  ^laltman.  of 
Cliicago.  acted  as  his  agent  in  purchasing  and 
forwarding  merchandise  of  various  kinds. 
.."About  September,  1879,  desiring  to  do  some 
trading  on  the  board  of  trade,  Chicago,  I  asked 
Maltman  to  recommend  some  good  responsible 
broker  on  the  board  of  trade,  through  whom  I 
could  do  business;  that  Maltman  recommended 
the  defendant,  who  th^n,  and  during  the  time 
in  question,  was  a  broker  residing  in  Chicago, 
and  doing  business  on  the  board  of  trade:  that 
thereupon  I  commenced  ti'ading  on  the  board, 
sending  my  orders  at  first  to  IMaltman,  who 
communicated  them  to  the  defendant;  that 
about  December,  1879,  I  came  to  Chicago,  made 
the  acquaintance  of  defendant,  and  thereafter 
did  business  directly  with  him;  that  I  contin- 
ued to  do  business  with  defendant  during  the 
years  1S79,  1880,  1881,  and  1882,  buying  and 
selling  on  the  board,  through  the  defendant,  as 
broker,  corn,  wheat,  oats,  pork,  and  other  com- 
modities, and  that  about  April  19,  1882,  I  had 
a  settlement  with  defendant,  in  which  all  pre- 
vious dealings  were  adjusted;  that  up  to  this 
time  the  transactions  which  I  had  made  through 
defendant  on  the  board  amounted  to  .?10.j,000 
in  1879,  $1,718,000  in  1880,  $010,000  in  18^1, 
and  .$072,000  in  1SS2;  that  in  November  or  De- 
cember, 1879,  and  at  other  times  prior  to  the 
settlement  in  April,  1882,  I  had  conversations 
with  the  defendant  in  which  I  told  defendant 
that  I  was  a  merchant  in  Foit  Wayne,  and  did 
not  want  it  known  that  I  was  engaged  in  specu- 
lating on  the  board  of  trade  in  Chicago,  as  it 
miglit  affect  my  credit,  and  that  the  account 
could  be  kept  in  the  name  of  A.  S.  ilaltman; 
tliat  I  considered  it  a  hazardous  business,  but 
was  willing  to  gamble  provided  I  could  have  a 
fair  show  that  I  wanted  my  deals  placed  with 
responsible  parties,  so  that  I  could  get  my  mju- 


ey  when  I  made  it:  that  I  didn't  want  any  of 
the  proi  erty,  but  meant  simply  to  do  a  gambling 
busiuiss;  that  defendant  told  me  [plaintiff] 
that  he  knew  what  I  wanted;  that  Maltman 
had  explained  my  situation  and  business;  that 
he  would  deal  only  \^ith  responsible  parties,  and 
the  deals  should  be  settled  so  as  to  get  the  prof- 
its or  losses;  that  defendant  told  me  [plamtiff] 
that  not  one  bashel  in  a  million  that  was 
bought  and  sold  on  the  board  was  legitimate 
business;  that  a  few  of  the  large  houses  did 
some  legitimate  business,  but  most  of  it  Avas 
simply  trading  in  differences;  that  he  [defend- 
ant] did  nothing  but  business  of  the  latter  kind; 
that  he  dealt  mostly  for  himself;  tliat  he  did 
a  good  deal  of  'scalping,'— deals  made  and  closed 
the  same  day,  on  the  tvu-u  of  the  market;  that 
he  did  not  let  his  deals  run  over  night;  that, 
up  to  April,  1882,  I  [plaintiff]  never  delivered 
or  received  any  of  the  property  so  sold  or 
bought,  nor  was  anything  ever  said  by  defend- 
ant to  me  about  receiving  or  delivering  the 
property  or  making  arrangements  to  do  so; 
that,  from  time  to  time  defendant  rendered' 
statements  to  me  [plaintiff]  showing  the  deals 
made,  the  price  per  bushel,  or.  in  'case  of  pork, 
the  price  per  100  lbs.,  at  which  the  commodity 
was  bought  and  sold,  the  difference  in  dollars 
and  cents,  the  commissions  charged,  and  the 
total  debit  or  credit  passed  to  my  account;  that 
all  the  deals  made  were  in  form  contracts  for 
future  delivery,  in  which  the  seller  had  the  op- 
tion of  delivering  at  any  time  during  some 
future  month;  that  up  to  April,  1882,  all  trades 
made  by  defendant  for  me  [plaintiff]  had  been 
settled  or  closed  by  coimter-trades  prior  to  the 
mouth  in  which  delivery  could  be  made;  up  ta 
April  19,  1882,  no  commodities  had  been  deliv- 
ered to  or  received  on  these  trades,  nor  had 
any  suggestion  or  requirement  on  the  part  of 
Mr.  Barber  to  deliver  been  made;  that  defend- 
ant never  reported  to  me  the  names  of  the  par- 
ties with  whcm  trades  were  made  on  my  ac- 
count, and  that  I  never  knew  or  inquired  who 
such  parties  were;  that,  after  the  settlement 
in  April,  I  commenced  selhug  wheat  for  July 
deliveiy,  and  by  the  last  of  May  had  sold, 
through  defendant,  100,000  bushels  for  that  de- 
livery, which  are  the  trades  in  question  in  this 
case;  that  there  was  a  comer  in  July  wheat, 
and  the  price  was  forced  up  ten  or  twelve  cents; 
that  on  the  last  of  July  I  came  to  Chicago,  had 
an  interview  with  defendant  in  the  morning, 
in  which  he  [defendant]  proposed  to  make  a 
tender  of  No.  2  red  winter  wheat,  the  kind  sold 
being  No.  2  spring  wheat;  that  No.  2  red  win- 
ter is  intrinsically  more  valuable  than  No.  2 
spring,  but  that  on  the  last  of  July  the  former 
stood  at  98  cents  per  bushel,  and  the  latter  at 
$1.3.5  to  $1.37;  that  I  [plaintiff]  knew  of  the 
tender,  and  I  did  not  object;  that  I  met  de- 
fendant later  in  the  day.  and  was  informed  by 
him  that  he  had  borrowed  warehouse  receipts 
for  ten  thousand  bushels  No.  2  red  winter  wheat, 
and  had  made  a  tender  of  the  same  to  the 
several  parties  to  whom  he  had  sold  the  wheat, 
and  that  such  tender  was  in  every  ca^-e  de- 
cliued,  and  that  said  tender  was  made  uuleic 


<J14 


ILLEGAL  SALES. 


thf  following  rules  of  the  board  of  trade,  viz.: 
'Ou  coutracts  for  grain  for  future  deliveiy,  the 
teudor  of  the  hisher  grade  of  the  same  kind  of 
grain  as  the  one  contracted  for  shall  be  deemed 
surticicut,  provided  the  higher  gi-ade  of  grain 
teiuh-n  d  sliall  not  be  of  a  color  or  quality  that 
will  depreciate  the  value  of  the  other,  if  mixed.' 
"Prior  to  December,  isTO,  I  bought,  through 
tlefendant,  100,000  bushels  of  corn  for  Decem- 
ber delivery.  I  came  to  Chicago,  and  defend- 
ant told  me  the  deal  had  gone  against  me  $4,- 
.")()0,  and  he  said  I  had  to  close  it  that  day. 
The  loss  was  that  amount,  and  I  paid  it  that 
day.  Xo  corn  was  delivered  on  either  side.  In 
January,  ISSO,  I  sold,  through  Barber,  20,000 
bushels  of  wheat.  My  prolit  was  $400.  I  did 
not  take  the  profit,  but  sold  more,  and  the  deal 
went  against  me  $2,000,  and  I  paid  it  up.  I 
then  coujmenced  buying,  and  made  $600  on 
March  ^^•heat  bought  in  January.  I  commenced 
selling  wheat  in  March,  1880,  and  made  a  good 
deal  of  money  for  a  few  months;  recovered 
losses  in  April,  and  commenced  selling  May 
wheat.  The  May  options  took  a  sudden  stan 
up,  and  I  lost  $8,000,  and  I  paid  it.  It  was  ex- 
pressly stated  by  me  to  Barber  that  I  wanted 
no  propertj'.  lie  Imew  that.  He  said,  'Cer- 
tainly, I  know  that,'  and  that  the  deals  should 
be  settled  on  the  margins, — on  the  profits.  Up 
to  April,  1SS2,  nothing  had  been  delivered  by 
me  or  received  by  me,  nor  had  there  been  any 
suggestion  or  requirement  on  defendant's  part 
to  deliver  made,  on  the  other  hand,  it  was 
never  expected  to  handle  the  property,  but  mere- 
ly to  trade  in  the  different  deals.  Up  to  the 
close  of  the  July  deal,  1^82,  no  demand  had 
been  made  on  me  by  Barber  for  the  delivery 
of  wheat  or  com,  or  any  other  commodity. 
Tliat  I  received  the  following  statement  of  ac- 
count from  defendant  about  the  day  of  its  date, 
[which  was  read  in  evidence:] 


.;         =  C  lO  IQ  iS  o 

i^ 

.      =  i  as  =  to  m 

■^ 

•§£,         .         .            ..,  =  ^0  =  0 
^  -        •        <        ■Sx  =  o  =  r-r) 

Its 

1 

^  —  ri  I;-  o 


>.  if  -  " 


"  'I  have  100  M  July  spring  wh't  sold  for  you, 
and  the  settling  price  of  same  as  fixed  by  board 
of  trade,  (1.35,)  including  coms.,  14c.' 

"That  the  item  of  $12,000  balance  in  said  ac- 
count consisted  of  money  advanced  and  paid  to 
the  defendant;  that  the  item,  'July  3rd,  by 
draft,  $3,000,'  consisted  of  $3,000  money  paid 
the  defendant  by  means  of  a  draft." 

Plaintiff  testified,  further,  that  "on  April  2, 
1883,  I  served  the  following  notice  upon  the 
defendant,  by  delivering  to  him  a  copy  there- 
of. The  defendant  read  the  notice,  admitted 
he  had  the  money  in  his  hands,  but  declined  to 
paj^  it  over."  The  notice  was  offered  in  evi- 
dence, and  is  as  follows: 

''To  G.  M.  Barber,  Esq.:  In  a  statement 
made  by  you,  dated  October  30,  1882,  of  deals 
made  on  my  account  on  the  board  of  trade, 
Chicago,  you  acknowledge  a  balance  in  your 
hands  of  $11, 112. .50  in  my  favor,  being,  so  the 
statement  says,  the  difference  between  price 
j-ou  sold  100  M  July  wheat  for  me  and  the 
selling  price  of  same  as  fixed  by  the  board  of 
trade,  $1.35,  including  your  commission  of  \i 
cent.  Nowyoj  are  hereby  notified  that  I  claim 
all  contracts  for  sale  of  said  wheat  to  be  ille- 
gal and  void,  and  forbid  you  to  pay  over  any 
part  of  said  money  or  balance  to  any  one,  and 
I  further  demand  the  immediate  payment 
thereof  to  myself.  James  B.  White. 

"Dated  Chicago,  April  2,  1883." 

On  cross-examination  plaintiff  testified  that, 
during  all  the  time  he  traded  through  defend-1 
ant,  iNIaltman  continued  to  some  extent  to 
act  as  his  agent  in  the  Inisiness  with  defend- 
ant; that  he  received  some  profits  debited  to 
him  in  the  statement  offered  in  evidence;  that 
defendant  complied  with  his  orders,  so  far 
as  he  knows;  that  he  didn't  tliink  defendant 
had  anything  to  do  with  the  corner  in  wheat; 
that  he  (plaintiff)  had  nothing  to  do  with  the 
appointment  of  a  committee  by  the  board  to 
fix  a  selling  price  for  July  wheat;  that  he 
knew  what  was  going  on,  and  talked  with  A. 
M.  Wright  and  other  members  of  the  board 
of  trade  about  the  deal,  but  did  not  enter  into 
any  agreement  or  arrangement  with  the  other 
brokers  similarly  situated  to  the  defendant 
in  regard  to  legal  proceedings  to  prevent  the 
consummation  of  the  corner;  did  not  employ  , 
counsel  on  behalf  of  dofendan*',  or  authorize 
any  steps  to  be  taken  in  his  name;  that  he 
(plaintiff)  was  an  outsider,  and  was  not  rec- 
ognized in  that  matter;  that  he  did  not  agree 
to  pay  attorney's  fe^s.  but  expected  he  would 
have  to  do  so,  and  did  after  the  litigation  was 
over;  that  he  knew  a  bill  was  filed;  that  the 
matter  was  contested  and  decided  by  the  su- 
preme court  in  favor  of  the  cornerers.  The 
litigation  was  after  a  committee  appointed  by 
the  board  had  fixed  the  selling  price  at  $1.35. 

In  the  progre.ss  of  the  case  the  plaintiff"  testi- 
fied further,  among  other  things:  "I  left  it 
for  INIr.  Barber  to  put  the  contracts  in  form 
when  I  wished  him  to  buy  or  sell.  I  under- 
stood that  he  would  go  on  the  board  of  trade 
and  either  buy  or  sell,  and  I  understood  that 
he  did  go  on  the  board  of  trade  and  buy  and 


ILLEGAL  SALES. 


315 


sell  according  to  my  orders.  There  was  no 
disobedience  of  my  orders,  so  far  as  1  know. 
I  have  no  complaint  to  make  on  the  score  of 
nonoliservauce  of  my  orders.  I  knew  that 
while  we  thought  the  corner  in  J^ily  wheat 
was  about  to  cuhninate,  buyhig  wheat  at 
Milwaukee  or  elsewhere  to  fill  orders  was 
talked  about,— a  great  many  talked  of  it, — 
but  it  was  considered  that  parties  who  at- 
tempted that  got  beaten,  because  they  sim- 
ply dropped  the  grade  on  them.  It  is  possible 
I  may  have  talked  with  ^laltman  about  the 
possibility  of  buying  wheat  in  ^.Jilwaukee  to 
fill  my  orders,  but  I  never  dreamed  of  it.  I 
.said  sonif  Avero  doing  it;  some  did  do  it.  It 
was  generally  talked  that  some  i>eople  had 
done  it,  and  as  to  the  propriety  of  doing  it.  It 
was  only  three  cents,  I  think,  to  bring  it  fi'om 
Milwaukee  here,  and  twelve,  fifteen,  or  twen- 
ty cents,  snmewiiere  along  tliei'e,  lower  a 
bushel,  and  they  could  fill  their  contracts  here 
with  it,  and  not  lose  so  much  as  they  would 
in  the  extortion  of  the  corner.  I  might  have 
said,  'Well,  it  could  be  done.'  'I  wish  I  could 
do  it,'  or  something  of  that  kind.  I  knew 
B.arber,  being  a  member  of  the  board  of  trade 
.and  making  contracts  on  the  board  for  me, 
would  ba  obliged  to  observe  the  rules  of  the 
beard.  I  understood  there  was  a  rule  that 
one  must  keep  his  margin  good.  I  told  him 
to  buy,  and  told  him  to  sell,  and  told  him  to 
sell  out,  and  when  to  cover  and  when  to  close 
trades,  and  he  cbsei'ved  my  orders.  If  there 
was  any  corner  it  was  not  my  fault,  as  I  was 
selling,  and  it  was  not  from  Barber's  fault, 
•so  far  as  I  know.  After  he  made  the  tender 
of  red  winter  wheat  on  the  tliirty-first  of 
July,  1SS2,  I  approved  of  what  he  did.  1 
went  to  see  Mr.  A.  M.  Wright,  who  Avas  one  of 
the  parties  proposing  to  file  a  bill  to  question 
the  propriety  or  binding  force  of  a  finding  of 
a  committee  of  the  board  of  trade  fixing  the 
settling  price  for  July  wheat.  I  saAV  published 
a  communication  in  the  paper,  an  interview 
with  the  reporter,  in  regard  to  this  corner,  or 
at  least  he  publi.shed  a  communication,  and 
I  went  to  see  him.  and  consulted  with  him 
about  it.  The  complaint  Avas  that  the  price 
of  July  wheat  was  put  too  high  on  the  thirty- 
first  of  July.  Barber  had  spoken  about  the 
•  contracts  being  under  the  board  of  trade  rules. 
After  the  culmination  of  the  corner  I  got  a 
copy  of  the  rules,— printed  copy.  He  shoAved 
me  the  rules  under  which  the  committee  was 
-appointed.  I  think  the  rule  is  on  page  51  of 
Rules  of  1SS2,  §  3.  Mr.  Wright  believed  it 
was  a  legal  tender;  so  did  I.  I  believed  that 
'red'  would  be  a  good  tender.  I  went  to  see 
counsel.  It  was  John  E.  Burke.  He  was  a 
lawyer,  who  had  charge  of  Avhat  he  called 
'Contested  Cases.'  There  were  some  thirty- 
tAVo  members  of  the  board  in  contested  cases, 
and  jNIr.  Barber  joined  in  with  them.  I  foot- 
ed the  lawyer's  bill;  that  was  all  I  did.  I 
told  Mr.  Burke  that  I  was  one  of  the  felloAvs 
that  got  bled  in  this  affair,  and  I  did  not  Avant 
to  stand  it  if  he  could  help  it.    He  Avas  seem- 


ingly as  nuicli  out  of  humor  about  it  as  I  Avas, 
as  far  as  the  situation  AA'as  concerned,— the 
unfairness  of  it.  When  it  came  to  pay  for  the 
expense  of  tliose  legal  proceedings,  the  bills 
were  pre.sented  to  Mr.  Barber  and  :Mr.  Malt- 
man,  and  I  told  them  to  pay  them  and  I 
would  pay  them  back;  and  I  did.  I  AA'ent  with 
Mr.  Wright  to  Mr.  Burke.  Mr.  Barber  AAas 
away  from  home  at  the  time.  I  told  Mr. 
Burke  the  situation  I  was  in,  and  he  said: 
'Well,  Avhen  j-our  broker  comes  here,  have  him 
come  up  and  see  me.'  It  Avas  luiderstood  that 
Mr.  Barber  Avas  my  broker  or  commission 
meichant.  and,  Avhen  he  returned,  he  Avent 
and  joined  in  Avith  the  others  to  contest  this 
thing.  I  kneAV  hoAv  the  matter  prG5:vessed  aft- 
er that.  It  Avas  contested  in  the  court?  in 
some  formal  AA'ay  to  get  into  the  supreme 
court.  There  was  a  px'o  forma  decision  in  the 
court  here,  and  the  case  Avas  taken  to  the  su- 
preme court,  and  was  there  determined  in  fa- 
vor of  the  cornerers.  That  was  after  the  com- 
mittee of  the  board  of  trade  appointed  under 
these  rules  had  been  appointed.  The  case 
went  to  the  supreme  court.  We  simply  had 
to  have  patience  to  wait  until  they  determin- 
ed it.  They  determined  it  about  a  year  ago 
last  January,— that  is,  in  January.  188o,— be- 
fore 1  had  served  notice  on  him.  In  most 
cases  Avhere  I  bought  or  sold,  I  closed  before 
the  ejid  of  the  month  in  some  way, — either 
sold  out  or  CGA^ered  it.  If  I  bought  Avheat  of 
a  man  for  the  month  of  July,  he  had  the  Avhole 
month  of  .July  in  which  to  tender  to  me. 
During  the  whole  of  the  month  of  July  I  liad 
an  option  at  what  time  I  would  deliver.  The 
buyer  has  to  close  his  trade  the  first  of  the 
month,  and  the  seller  has  to  the  last  of  the 
mouth,  or,  if  he  pleases,  he  can  close  betAveen 
times." 

GJeorge  M.  Barber,  defendant,  being  first 
duly  sworn,  testified  as  follows:  That  after 
the  notice  was  seized  upon  him  by  plaintiff, 
in  April,  ISSo,  he  paid  over  to  the  various 
parties  to  Avhom  he  had  owed  the  wheat  in 
question  the  sum  of  $11,412..50,  less  the 
amount  of  his  commissions,  which  were  $2.30; 
and,  on  cross-examination,  that  he  made  such 
payment  because  charges  had  been  preferred 
against  him  and  he  had  to  pay  or  be  suspend- 
ed from  the  board. 

Plaintiff  here  rested  his  case,  and  the  de- 
fendant, to  maintain  the  issues  on  his  part, 
introdviced  the  foUoAving: 

George  IM.  Barber,  defendant.  Avho,  being 
recalled,  testified  that  he  AA'as  a  commission 
merchant  and  member  of  the  board  of  trade; 
that  he  Avas  employed  by  Maltman  to  trade  for 
plaintiff  on  the  board  of  trade,— to  make 
trades  there;  that,  in  executing  the  orders  of 
plaintiff,  he  dealt  with  other  members  of  the 
board;  that  he  did  not  seek  commission  busi- 
ness, but  dealt  mostly  on  his  oavu  account;  that 
once,  Avhen  White  was  hanging  on  to  a  deal 
which  had  gone  against  him.  Avitness  told  him 
that  Avitness  never  hung  on  to  a  deal,  but  in 
his  OAvn  trades  generally  calculated,  when  he 


316 


ILLEGAL  SALES. 


■went  home  at  niixht,  to  have  an  equal  amount 
bought  and  sold,  so  that  he  would  not  bo 
affected  by  the  huetuatious  of  the  market,  but 
did  not  say  to  Mr.  White  that  Wliile's  busi- 
ness would  be  conducted  in  that  way.  Wit- 
ness had  to  be  governed  by  White's  orders, 
which  were  to  do  so  and  so;  did  not  recollect 
plaiutiff  saying  that  he  wanted  to  gamble  on 
the  board;  that  the  manner  of  making  ti'ades 
on  the  board  is  as  follows:  If  the  order  was 
to  sell,  he  would  go  on  the  board  and  offer  to 
sell  so  much  wheat  at  such  a  price,  and  some 
other  broker  would  accept  the  offei',  or  some 
other  broker  might  offer  to  buy.  and  he  (de- 
fendant) Avould  accept  the  offer,  and  thereupon 
both  parties  made  a  memorandum  of  the  trade 
on  a  card,  without  comparison;  that  such 
memorandum  was  usually  as  follows,  (re- 
ferring to  a  card,)  this  being  one  of  the  trades 
in  question:  "10  M,  July,  H.  G.  Gaylord, 
l:2dVs,  J.  B.  W.;"  that  this  was  the  only  wilt- 
irg  made  in  the  hurry  of  business  on  the 
board;  that  "10  M"  meant  10,000  bushels; 
"July"  meant  for  delivery  in  July,  at  the  sell- 
er's option;  that  No.  2  spring  wheat  was  un- 
derstood; that  "H.  G.  Gaylord"  was  the  name 
of  the  broker  to  whom  the  sale  was  made; 
that  "1.25'^{i"  denoted  the  price,  and  the  ini- 
tials "J.  B.  W."  indicated  that  the  sale  was 
on  account  of  plaintiff;  that  their  trades  were 
afterwards,  on  the  same  day,  entered  on  the 
books  of  the  respective  parties,  and  their  clerks 
went  round  and  compared  and  checked  them 
olf ;  that  this  was  the  case  with  the  sales  of 
100,000  bushels  for  delivery  at  seller's  option 
during  July,  1882,  (the  deals  under  considera- 
tion;) that  he  had  no  different  agreement  with 
any  of  the  persons  with  whom  he  dealt  for 
plaintiff;  that  the  grain  was  to  be  delivered 
or  received;  that  "puts"  and  "calls,"  or  mere 
options  to  buy  or  sell,  were  not  recognized  on 
the  board;  that  it  is  customaiy,  where  a  com- 
modity is  sold  to  and  bought  of  the  same 
broker,  upon  different  orders,  for  the  brokers 
to  settle  their  trades  by  paying  the  dif- 
ference, as  the  case  may  be.  (And  a  rule  of 
the  board  of  trade  aUowiug  such  transfers 
was  read  in  evidence.)  That  he  never  told 
plaintiff  that  trading  on  the  board  was  illegit- 
imate, but  may  have  told  him  many  of  the 
other  trades  were  settled  up,  or  offset,  with- 
out deliverj\  The  volume  of  transactions  was 
too  large  to  make  delivery  practicable  in  all 
cases.  As  to  the  conversation  between  wit- 
ness and  White,  November  30,  1879,  witness 
stated  he  believed  it  was  the  fii\st  time  he 
met  White,  for  whom  there  were  then  to  ma- 
ture contracts  to  buy  100,000  bushels  corn, 
and  witness  told  White  that  the  chances  were 
strong  that  the  corn  would  be  delivered,  and 
he  must  either  furnish  the  monej^  to  pay  for 
it  or  order  him  to  sell  it,  so  that  he  would 
have  a  place  to  put  it,  when  delivered,  or 
could  make  arrangements  to  transfer  it;  that 
in  the  contracts  for  Mr.  White  witness  had 
received  and  delivered  property;  had  received 
as  high  as  60,000  bushels  in  a  day;  that,  at 


tlie  re<]m'st  of  plaintiff,  ho  did  not  settle  the 
(■■■'als  for  .July,  but  made  default  as  to  the 
1011,000  bushels.  "Mr.  Maltman,  for  Mr. 
AVhile,  gave  me  the  draft  of  $.j,000,  June  12, 
1882.  I  Y^s  required  to  give  my  word  that 
I  Avould  not  buy  in  the  wheat  unless  by  his 
orders,  but  would  allow  him  to  default,  and 
Maltman  told  me  that  White  said  he  would 
settle, — let  the  committee  lix  the  price,  and  he 
would  settle  that  way,  if  possible,  if  he  did 
not  decide  to  buy  in  the  wheat."  White  sent 
witness  a  telegram  from  Fort  Wayne.  Au- 
gust 5,  1882,  as  follows:  "Don't  cancel  the 
July  trades.  My  attorneys  here  believe  the 
tender  we  made  is  good,  and  can  be  enforced. 
J.  B.  White."  (Telegram  read  in  evidence.) 
There  were  about  30  other  brokers  who  made 
default;  that  a  committee  was  appointed  in 
accordance  with  the  rules  of  the  board,  who 
fixed  the  settling  price  at  $1.35;  that  thereuj)on 
the  brokers  filed  bills  in  court,  to  enjoin  the 
board  from  suspending  them  for  not  settling 
at  the  price  fixed  by  the  committee;  that  he 
returned  to  the  city  about  September  10,  1882, 
after  being  absent  a  mouth  or  more,  and  was 
informed  by  3Ialtman  that  the  plaintiff  had 
made  arrangements  for  him  to  join  in  the  in- 
junction proceedings;  that  the  next  day  he 
went  to  the  oflice  of  J.  E.  Burke,  the  attorney 
for  the  defaulting  brokers,  and  signed  and 
swore  to  a  bill  for  the  purpose  above  stated; 
that  said  bill  was  filed;  that  afterwards  the 
supi'eme  court  rendered  a  decision  adverse 
to  the  prayer  of  the  bill,  and  the  bill  was  dis- 
missed; that  plaintiff  was  informed  of  the 
result,  and  paid  the  attorney's  fees  and  dam- 
ages in  the  case;  that  plaintiff  did  not  suggest 
the  making  of  any  further  contest;  that  at 
the  time  plaintiff  made  the  demand  upon  him, 
April  2,  188^^,  ihe  monej^  in  question  was  un- 
der his  conti'ol,  except  $6,700.  which  had  been 
deposited  in  the  bank  as  margins,  on  account 
of  some  of  the  deals;  that  he  frequently  re- 
ceived and  delivered  grain;  had  received  as 
high  as  60,000  bushels  in  a  day;  that  he  could 
not  recall  any  trade  in  which  he  bought  for 
Mr.  White  where  he  received  any  commodity, 
but  had  no  doubt  at  all  in  all  his  tradings  he 
did  I'eceive  a  good  deal,  but  could  not  recall 
any  particular  instance.  "There  was  a  cer- 
tainty that  delivery  would  be  made,  imless. 
after  the  trades  Avere  made,  I  made  offsets. 

1  always  do  get  more  or  less;  do  not  expect  it 
will  all  be  delivered.  I  expect  I  can  offset 
trades  with  a  good  part  of  it."  When  the 
100.000  bushels  in  question  were  sold,  wit- 
ness expected  it  would  be  delivered;  that  he 
would  buy  here  in 'the  market,  the  largest 
grain  market  in  the  world. 

Thomas  W.  Burns,  being  duly  sworn,  tes- 
tified for  the  defendant  that,  in  1882,  he  Avas 
a  member  of  the  firm  of  Ulrich,  Busch  & 
Co.,  and  a  broker  on  the  board  of  trade;  that,, 
on  May  17,  1882,  he  bought  of  defendant, 
for  his  firta,  "5,  July  Avheat.  at  1.24%."  No. 

2  spring  Avheat,  (5,000  bushels;)  that  the  con- 
tract was  made  in  the  regular  way;    that 


ILLEGAL  SALES. 


317 


there  was  no  secret  understanding  or  agree- 
ment that  it  was  not  to  be  executed,  or  that 
it  was  to  be  settled;  that  the  wheat  was  to 
be  delivered  at  any  time  in  July,  at  the 
seller's  option. 

Abel  H.  Bliss,  being  duly  sworn,  testified 
for  defendant  that  he  was  a  mem1)er  of  the 
board  of  trade,  and  was  doing  business  as  a 
commission  merchant  in  ISSli;  that  in  May 
he  bought  10,000  bushels  July  wheat  (No.  2 
spring,  deliverable  at  sellex-'s  option  at  any 
time  during  Julj')  of  defendant,  which  he 
never  received;  the  wheat  was  to  be  deliver- 
ed in  July,  at' the  seller's  option;  that  there 
was  no  agreement  that  the  wheat  was  not  to 
1)6  delivered,  or  that  it  was  to  be  settled; 
that  he  certainly  expected  to  get  the  wheat. 

It  was  admitted  that  the  other  brokers  to 
whom  defendant  had  sold  the  w'heat  in  ques- 
tion Avould  testify  in  a  similar  way,  as  to 
the  trades  with  them,  respectively. 

Alexander  S.  Maltman,  being  sworn,  testi- 
fied, for  defendant,  that  he  was  of  the  firm 
of  A.  S.  Maltman  &  Co.,  and  was  engaged 
In  the  commission  business  in  Chicago;  that 
he  acted  as  agent  for  plaintiff,  in  his  trans- 
actions with  defendant;  that  he  never  told 
defendant  that  the  transactions  were  to  be 
of  a  gambling  or  fictitious  character;  that 
his  instructions  from  plaintiff  were  for  the 
most  part  contained  in  telegrams  and  let- 
ters, and  these  he  gave  or  showed  to  defend- 
ant; that  the  transactions  were  quite  con- 
tinuous; that,  in  July.  1882,  he  had  several 
conversations  with  plaintiff  as  to  Barber 
defaulting;  that  when  the  price  was  up  in 
the  thirties,  plaintiff  was  unwilling  to  ad- 
vance more  margins  unless  defendant  would 
agree  to  default,  and  that  he  procured  such 
an  agreement  from  the  defendant  at  the  re- 
quest of  plaintiff:  that,  after  default  had 
been  made,  plaintiff  said  he  was  willing  to 
leave  it  with  the  committee  to  be  appointed 
by  the  board;  that  he  went  with  plaintiff  to 
the  office  of  Burke,  the  attorney;  that  plain- 
tiff went  there  to  get  otit  an  iniunction  to 
prevent  the  board  of  trade  from  sus]iending 
defendant;  that  he  paid  out  for  plaintiff  on 
account  of  the  said  suit  $283.50,  which  plain- 
tilT  had  repaid  him. 

George  F.  Morcom,  being  duly  sworn,  tes- 
tified for  defendant  that  he  Avas  of  the  firm 
of  A.  S.  Maltman  &  Co.;  that  he  heard  plain- 
tiff say  that  the  tender  of  No.  2  red  winter 
wheat  was  good;  that,  according  to  their 
own  lilies,  they  were  l)oun(l  to  accept  It; 
that  plaintiff  said  that  he  desired  Mr.  Bar- 
ber to  default  on  the  deals  and  let  the  mat- 
ter go  to  a  committee  and  let  them  fix  the 
price,  and  said  that  he  would  see  that  Mr. 
Barber  was  protected. 

Deville  C.  Bannister,  being  duly  sworn, 
testified  for  defendant  that  during  the  time 
in  question  he  was  book-keeper  for  defend- 
ant; that  plaintiff,  at  the  time  the  injunc- 
tions were  being  obtained,  went  to  Mr. 
Burke's  office  to  see  about  the  matter,  and 
said  he  wished   he   w^ould   take   the    matter 


into  his  own  hands;  that  Mr.  Barber  did  not 
pay  over  the  money  until  it  was  necessary  to 
do  so  in  order  to  save  himself  from  being 
suspended  from  the  board. 

The  bill  in  chancery  above  referred  to, 
being  a  bill  filed  in  the  superior  court  of 
Cook  county,  by  George  M.  Barl)er,  in  the 
interest  of  or  for  the  benefit  of  the  plaintiff, 
on  the  eleventh  of  September,  lo<52,  making 
the  board  of  trade  of  the  city  of  Chicago 
party  defendant,  was,  together  with  a  copy 
of  the  injunction  issued  in  pursuance  of  the 
w-rit,  read  in  evidence.  It  set  forth  certain 
sections  of  the  charter  of  the  board  of  trade, 
and  referred  to  a  copy  of  the  rules  of  said 
board  in  force  January  1,  1882,  making  such 
copy  a  part  of  the  bill  as  an  exhiliit,  and  re- 
ferred also  to  sales  of  No.  2  spring  wheat, 
made  by  defendant  for  delivery  in  July,  1882, 
and  alleged  that  there  was  an  unlawful  com- 
bination to  prevent  the  complainant  and  oth- 
ers situated  like  him  from  fulfilling  thein 
contracts,  etc.,  and  set  forth  a  certain  rule 
of  the  board  of  trade  providing,  among  oth- 
er things,  for  the  appointment  of  a  commit- 
tee to  detei'mine  disputes  as  to  the  price  of 
property,  in  case  of  supposed  excessive 
claims  for  damages  being  made  under  con- 
tracts, on  default,  etc.,  and  showed  that  ap- 
plication for  the  appointment  of  such  com- 
mittee was  made  with  reference  to  the  de- 
faults made  upon  contracts  for  delivery  of 
No.  2  spring  wheat  in  July,  1882,  and  show- 
ed that  the  committee  determined  the  price 
for  settlement  at  $1.35  per  bushel;  and  the 
decision  of  the  committee  was  drawn  in  ques- 
tion by  the  bill  upon  various  grounds,  not 
drawing  in  question  the  validity  of  the  con- 
tracts, but  questioning  whether  the  board  of 
trade  had  power  to  compel  members  to  al)ide 
the  decision  of  such  committee,  and  also  ques- 
tioning the  regularity  of  the  appointment  of 
the  committee,  and  charging  that,  in  the  con- 
duct of  the  hearing  had  before  the  commit- 
tee, and  in  the  finding  of  the  committee,  the 
spirit  of  the  rules  of  the  board* of  trade  was 
violated  by  putting  it  in  the  power  of  per- 
sons who  had  been  concerned  in  cornering 
the  market  to  get  excessive  damages,  etc. 
The  bill  pointed  out  certain  mles  of  the 
board  of  trade  under  which,  in  case  a  mem- 
ber failed  to  comply  promptly  with  the  terms 
of  any  business  contract  or  obligation,  or 
failed  to  satisfy,  adjust,  and  settle  the  con- 
tract, or  failed  to  comply  with  or  fulfill  any 
aM'ard  of  the  committee  of  arbitration,  or 
committee  of  appeals,  made  in  conformity 
with  the  rules,  regulations,  and  by-laws  of 
the  association,  he  should,  upon  admission 
or  proof  of  the  delinquency  before  the  board 
of  directors,  be  subject  to  be  suspended  from 
all  privileges  of  the  association,  etc.;  and  an 
injunction  to  prevent  suspension  or  expul- 
sion, and  especially  to  restrain  and  enjoin 
the  board  from  accepting,  treating,  or  rec- 
ognizing the  decision  of  the  committee  afore- 
s.Mid  as  in  force,  or  as  having  any  effect,  w.'is 
prayed  for  by  the  bill.     Such  injunction  was 


31S 


ILLEGAL  SALES. 


onlorod.  and  was  issued  Soptfinber  11,1882, 
and  was  served  on  the  board.  There  was  also 
introduced  a  certified  transcript  of  tlie  order 
of  said  superior  court,  made  on  tlie  eleventh 
of  October,  1882,  dissolving  the  injunction, 
and  assessing  damages  on  account  of  the 
issuing  of  the  same,  but  showing  that,  by 
stipulation,  the  cause  was  to  al)ide  the  tinal 
result  of  the  case  of  Abner  N.  Wright  et  al. 
V.  The  Board  of  Trade  of  the  City  of  Chicago, 
in  the  appellate  court  or  in  the  supreme 
court,  and  that,  in  case  of  the  reversal  of 
the  decree  in  that  case,  then  the  decree  In 
the  Barber  Case  should  be  set  aside  on  his 
motion,  and  the  injunction  in  his  favor  was 
continued.  This  decree  was  to  be  regarded 
as  final  in  case  the  decree  in  the  Wright 
Case  should  be  affirmed,  except  that,  in  such 
case,  tlie  injunction  was  to  be  dissolved,  on 
defendant's  motion.  The  transcript  further 
showed  that,  on  the  sixteenth  of  April,  1883. 
the  said  superior  court,  in  the  said  chancery- 
suit  of  Barber,  vacated  the  order  to  con- 
tinue the  injunction,  and  the  bill  thereupon 
stood  dismissed  under  the  previous  order  of 
the  court,  this  being  because  the  supreme 
court  had,  in  the  Case  of  Wright,  afflrmed 
the  decree  of  the  superior  court  dismissing 
his  bill.  It  appeared  that,  after  the  deci- 
sion of  the  Wright  Case,  inquiry  was  made 
of  the  plaintiff  as  to  wliether  he  wislied 
anything  further  done  in  refei'ence  to  the 
prosecution  of  the  chancery  suit  in  the  name 
of  Barber,  and  he  replied:  "Further  appear- 
ance not  necessary." 

It  further  appearing,  from  the  testimony, 
that  the  plaintiff  paid  the  damages  which 
were  assessed  against  Barber  on  account  of 
the  issuing  of  the  injunction,  the  testimony 
of  the  witness  Barber  tended  to  show  that, 
at  the  time  of  the  delivei'y  by  defendant  to 
the  plaintift"  of  the  statement  aforesaid,  dat- 
ed October  30.  1882.  the  balance  of  .$11,412.- 
50  therein  mentioned,  that  amount  being  the 
difference  between  the  price  at  which  the 
100,000  bushels  of  wheat  were  sold  for  .Inly 
delivery,  and  .$1.3.5  per  bushel,  the  selling 
price  so  fixed  by  the  committee.—that  is,  the 
difference  over  and  above  the  commissions 
of  one  fourth  of  a  cent  per  bushel  charged 
by  the  defendant, — was  to  remain  with  the 
defendant,  to  await  the  action  of  the  court 
upon  the  afoi*esaid  bill  in  equity,  seeking  to 
impeach  the  decision  of  the  committee  fix- 
ing the  settling  price,  and  that,  after  that 
matter  had  been  litigated  in  the  courts, 
through  the  suit  so  brought  in  favor  of 
Wright,  which  was  made  a  test  casp,  com- 
plaints were  made  before  the  board  of  di- 
rectors of  the  board  of  trade  against  the 
defendant  on  account  of  default  on  his  part 
in  performing  or  settling  the  contracts  for 
the  sale  of  the  said  l(K),Oii()  bushels  of  wheat, 
notice  of  one  or  more  of  which  complaints 
was  given  by  defendant  to  plaintitT,  and  the 
defendant  appeared  before  the  directors  to 
make  defense,  but  did  not  succeed  in  mak- 
ius  anv  defense,  and.  being  about  to  be  sus- 


pended unless  he  settled,  did  thereupon  set- 
tle by  paying  according  to  the  decision  of 
the  committee  declaring  $1.35  per  bushel  to 
be  the  settling  price,  so  that  the  moneys 
paid  out  by  defendant,  together  with  his 
commission,  exhausted  the  said  sum  of  $11,- 
412.50;  and  this  was  prior  to  the  commence- 
ment of  tliis  suit,  but  after  the  notice  of 
April  2.  1883,  above  set  forth.  The  testimo- 
ny tended  to  show  that  this  money  was  left 
in  defendant's  hands  by  Mr.  White,  when  the 
aforesaid  statement  of  account  stating  said 
balance,  etc.,  was  given  by  defendant  to  the 
plaintiff,  and  Avas  so  left  for  the  protection 
of  the  defendant,  as  to  the  contracts,  with  ref- 
erence to  the  litigation  arising  as  to  whether 
the  decision  of  the  committee  should  be  al- 
lowed to  be  binding  in  I'egard  to  the  settling 
price. 

On  the  foregoing  evidence,  the  plaintiff 
claimed  to  recover  the  before-named  sum  of 
$11,412.50,  as  money  placed  by  him  in  the 
hands  of  the  defendant  for  the  purpose  of 
dealing  in  gambling  contracts  at  the  Chicago 
board  of  trade,  and  which  contracts,  it  was- 
asserted,  Avere  made  illegal  by  a  statute  of 
Illinois.  The  court  charged  the  jury,  among 
other  things,  as  follows:  "The  question  of 
fact  for  you  to  determine  under  the  proof 
is  whether  these  dealings  made  by  the  plain 
tiff  on  the  board  of  trade,  through  the  de- 
fendant, as  his  broker,  were  gambling  con- 
tracts, within  the  meaning  of  the  law.  The 
statute  of  the  state  of  Illinois  upon  the  sub- 
ject I  will  now  read  you.  Section  130  of 
chapter  38  [Hurd,  Rev.  St.  111.  Ed,  1883,  p. 
394;  Ed.  1885,  p.  405]  reads  as  follows  r 
'Whoever  contracts  to  have  or  give  to  him- 
self or  another  the  option  to  sell  or  buy,  at  a 
future  time,  any  grain  or  other  commodity, 
stock  of  any  railroad  or  other  company,  or 
gold,  or  forestalls  the  market  by  spreading 
false  rumors  to  influence  the  price  of  com- 
modities therein,  or  corners  the  market,  or 
attempts  to  do  so  in  relation  to  any  of  such 
commodities,  shall  be  fined  not  less  than  $10 
nor  more  than  $1,000,  or  confined  in  the 
county  jail  not  exceeding  one  year,  or  bothr 
and  all  contracts  made  in  violation  of  this 
section  shall  be  considered  gambling  con- 
tracts, and  shall  be  void,'  The  plaintiff  con- 
tends that  the  contracts  in  question,  made 
by  the  defendant  for  him  and  in  his  behalf. 
were  gambling  contracts,  within  the  mean- 
ing of  this  law.  The  question  then  arises, 
what  kind  of  contracts  are  prohibited  by 
this  statute"?  You  will  notice  the  language 
is,  'whoever  contracts  to  have  or  give  to 
himself  or  another  the  option  to  sell  or  buy 
at  a  future  time,'— an  option  to  sell  or  bu.v 
at  a  future  time.  The  courts  have  construed 
to  some  extent  the  meaning  of  this  statute, 
and  I  will  read  from  a  case  decided  by  the 
supreme  court  of  this  state  the  construction 
which  is  there  given  upon  it:  'The  evidence 
in  this  record  is  by  no  means  concUisivc- 
that  the  contracts  for  grain  made  by  defend- 
ants    for     plaintiff     were     unlawful.      I'liey 


ILLKCAL  SALES. 


319 


were  made  in  the  regular  course  of  business, 
and.  for  anything  that  appears  in  this  rec- 
ord, they  could  have  been  enforced  in  the 
courts.  It  is  true,  they  wei"e  time  contracts, 
—that  is,  the  seller  had  all  of  the  month  in 
which  to  deliver  the  grain;  but  the  testi- 
mony of  Wolcott  is  they  were  bona  tide  con- 
tracts for  the  actual  purchase  of  the  grain. 
The  only  option  tlie  seller  had  was  as  to 
tlie  time  of  delivery.  Tlie  obligation  was  to 
deliver  the  grain  at  all  events,  but  it  was 
the  seller's  privilege  or  option  to  deliver  it 
at  any  time  before  the  closing  of  business  on 
the  last  day  of  the  mouth.  Time  contracts, 
made  in  good  faith,  for  the  future  delivery 
of  grain  or  any  other  commodity,  are  not 
l»rohibited  by  the  common  law,  nor  any  stat- 
ute of  this  state,  nor  by  any  policy  bene- 
ficial to  the  public  welfare.  Such  a  restraint 
would  limit  commercial  transactions  to  such 
a  degree  as  could  not  but  be  prejudicial  to 
the  best  interests  of  trade.  Our  present 
statute  was  not  in  force  when  these  deal- 
ings were  had;  consequently  the  rights  of 
the  parties  are  not  affected  by  it.  What  the 
law  prohibits,  and  what  is  deemed  detri- 
mental to  the  public  interests,  is  specula- 
tions in  differences  in  market  values,  called, 
perhaps,  in  the  peculiar  language  of  the  deal- 
ers, '"puts"  and  '"calls,"  which  simply  means 
a  privilege  to  deliver  or  receive  the  grain  or 
not,  at  the  seller's  or  buyer's  option.  It  is 
against  such  fictitious  gambling  transactions, 
we  apprehend,  the  penalties  of  the  law  are 
leveled.'  "  The  above  extract  is  taken  from 
the  opinion  of  the  supreme  court  of  Illinois 
in  Wolcott  V.  Heath,  78  111.  433.  The  circuit 
court  then  proceeded  in  its  charge  as  fol- 
lows: "Now.  the  question  is.  in  the  light 
of  the  testimony  in  this  case,  whether  the 
contracts  in  question  in  this  case  were  con- 
tracts to  buy  or  sell  at  a  future  day.  or 
whether  they  were  simply  absolute  sal^s.  in 
which  the  seller  had  the  entire  month.— the 
month  specified, — in  which  to  perform  his 
contract.  This  court  has  found  it  necessary, 
on  several  occasions,  to  construe  this  statute, 
and  has  held,  with  the  case  Avhich  I  have 
just  read,  that  the  statute  is  leveled  against 
what  are  called  "puts'  and  'calls,' — that  Is, 
the  right  or  the  privilege  which  a  party  may 
have  to  buy  or  sell  of  you  at  a  future  day, 
not  an  absolute  agreement  now  to  sell,  but 
where  one  man  pays  another  $.5  or  .$10  for 
the  privilege  of  delivering  to  him  1.000.  5.000. 
or  lO.OOO  bushels  of  graiu  at  a  future  time, 
or  pays  him  a  similar  amount  for  the  priv- 
ilege of  buying  or  accepting  from  him  grain 
at  a  future  time.— a  contract  which  cannot 
be  enforced  in  terms,  because  it  is  wholly  at 
the  option  of  the  party  holding  the  option 
whether  he  will  call  for  the  grain  or  not. 
This  is  what  is  termed  a  "gambling  contract,' 
or  a  'put'  or  'call.'  or  'an  option  to  buy  or , 
sell  at  a  future  time.'  within  the  meaning 
of  the  Illinois  statute." 

The  bill  of  exceptions  further  says:     ""And 
the  court   further  expl;iine(l  to  the  jury  that 


the  "option  to  buy  or  sell,'  prohibited  by  sec- 
tion 130,  c.  lis.  of  the  Revi.sed  Statutes,  means  a 
privilege  which  the  buyer  or  seller  may  or 
may  not  exercise  at  his  option,  and  that  a 
contract  by  which  the  seller  absolutely  agrees 
to  deliver  a  certain  commodity  to  the  buyer 
within  a  specified  time,  wlien  the  only  option 
is  as  to  the  delivery  within  a  certain  time, 
such  as  within  the  whole  of  some  month 
named,  is  not  a  gambling  contract,  \Wtlun  the 
meaning  of  this  statute." 

There  were  otlier  instructions  to  the  jury, 
the  entire  charge  covering  nearly  seven  print- 
ed pages  of  the  record.  The  bill  of  exceptions 
states  that  the  plaintiff  excepted  to  all  of  the 
instructions  given,  and  especially  to  those 
hereinbefore  set  forth. 

The  second  case  above  named  is  a  suit  in 
equity,  brought  on  .July  24.  1S,S3.  in  the  cir- 
cuit court  of  Cook  county,  Illinois,  by  the 
Bank  of  British  North  America,  a  corporation 
Oi  Great  Britain,  again:  t  .James  B.  White  and 
George  M.  Barber.  The  biU  alleges  that  the 
bank  has  on  deposit,  in  its  office  at  Chicago, 
Illinois.  .$0,700,  standing  to  the  credit  of  Bar- 
ber, the  same  having  been  deposited  by  him 
as  security  for  certain  trades  or  deals  in  wheat 
with  members  of  the  board  of  trade  of  Chi- 
cago, the  money  having  been  turned  over  to 
the  plaintiff  by  the  ^Merchants'  Bank  of  Cana- 
da, to  whose  business  at  Chicago  the  plaintiff 
succeeded;  that  White  claims  that  said  money 
belongs  to  him,  and  claims  that  Barber,  in 
depositing  it.  acted  merely  as  the  agent  of 
him.  White;  that  on  April  2,  18S3,  White 
made  a  demand  upon  the  plaintiff  for  the 
money,  and  forbade  it  to  pay  the  money,  or 
any  part  thereof,  to  any  person,  except  upon 
the  order  of  him.  White;  that  White  had  com- 
menced an  action  against  the  plaintiff  to  re- 
cover the  money;  and  that  Barber  had  de- 
luanded  of  the  plaintiff  that  it  should  pay  the 
luoney  to  him.  The  bill  prays  that  the  de- 
fendants may  interplead  and  settle  the  con- 
troversy, and  that  the  plaintiff  may  be  al- 
lowed to  pay  the  money  into  court.  Both  of 
the  defendants  appeared  in  the  suit.  White 
put  in  an  answer  setting  up  that  the  $<;.70;) 
was  part  of  a  larger  sum  of  money  placed  by 
him  in  the  hands  of  Barber  to  be  used  by 
Barber  as  margins  in  gambling  contracts 
which  Barber  was  to  make  for  him  on  the 
board  of  trade  in  Chicago;  that  Barber,  in 
pursuance  of  such  employment,  and  in  .Vpril. 
May.  and  June,  1882.  made  certain  gambling 
contracts  with  members  of  the  board  of  trade, 
wliich  contracts  were  ostensibly  for  the  sale 
of  certain  quantities  of  wheat  by  Barber  to 
such  members,  to  be  delivered  at  any  time  iu 
July,  1882.  at  the  option  of  the  pretended  pu  - 
chaser,  but  such  pretended  contracts  were  a 
mere  form  and  cover,  and  tne  real  intention 
of  all  the  parties  was  to  settle  them  by  a  pay- 
ment of  the  difference  between  the  price  for 
which  the  wheat  was  sold  and  the  market 
price  of  the  same  when  delivery  thereof  shouM 
be  called;  nmt  Barber  took  .$(i,700  of  the 
money  of  White,  so  placed  in  his  hands,  and 


320 


ILLEGAL  SALES. 


iloposited  the  same  with  the  Merchants'  Bank 
of  Canada,  as  security  for  certain  of  such  pre- 
tendetl  contracts,  being  the  same  $6,700  turn- 
ed over  to  the  plaintiff  by  the  Merchants' 
Bank,  and  that,  while  the  money  was  still 
in  the  possession  of  the  plaintiff,,  and  on  April 
2,  18S3,  White  notified  both  the  plaintitf  and 
Bai'ber  not  to  pay  the  same  to  any  one  but 
A^'hite. 

Barber  also  answered  the  Tilll,  and  in  his 
answer  made  the  following  allegations:  He 
was  not  the  agent  of  White  in  depositing  the 
$(5,700.  As  a  commission  merchant  at  Chi- 
cago, he  made  certain  sales  and  purchases  of 
gi'ain  and  poi'k,  for  future  delivery,  at  the  in- 
stance and  request  of  White,  being,  as  be- 
tween himself  and  those  with  whom  he  made 
the  contracts,  responsible  for  the  performance 
of  them  on  his  part.  A  large  number  of  such 
transactions  occurred  in  May,  June,  July,  Au- 
gust, September,  and  October,  1882.  Barber 
was  doing  business  on  the  board  of  trade  of 
Chicago,  of  which  he  was  a  member,  and 
White  was  living  at  Fort  Wayne,  in  Indiana. 
The  contracts  were  made  with  reference  to 
the  rules  and  regulations  of  the  board  of 
trade,  and  to  the  usages  of  business  on  that 
board;  and  by  those  iiiles,  the  persons  with 
whom  Barber  made  such  contracts  were  au- 
thorized to  demand  margins  and  deposits,  as 
security  for  the  performance  of  the  contracts 
by  Barber,  and  in  various  instances  such  de- 
mands were  made,  and  it  became  necessary 
for  Barber  to  make  deposits  for  margins  or 
.'•.ecurit:^  with  reference  to  the  contracts. 
These  rules  provided  t}rat,  on  time  contracts, 
purchasers  should  have  the  right  to  require 
<  f  sellers,  as  security,  10  per  cent,  margins, 
based  upon  the  contract  price  of  the  property 
bought,  and  further  security,  from  time  to 
time,  to  the  extent  of  any  advance  in  the  mar- 
ket value  above  that  price;  also  that  sellers 
should  have  the  right  to  require,  as  security 
from  buyers,  10  per  cent,  margins  on  the  con- 
tract price  of  the  property  sold,  and,  in  addi- 
tion, any  difference  that  might  exist  or  occur 
between  the  estimated  value  of  said  property 
and  the  price  of  sale.  The  rules  also  provided 
that  securities  or  margins  should  be  deposited 
either  with  the  treasurer  of  the  board  of  trade, 
or  with  some  bank  authorized  to  receive  the 
deposits.  The  rules  also  prescribed  the  form 
of  certificate  to  be  used  by  the  bank,  which 
form  was  adopted  by  the  ^Merchants'  Bank  of 
Canada,  and  by  the  plaintiff.  In  accordance 
with  those  rules,  the  certificates  showing  the 
deposits  were  issued  in  duplicate  in  eacn  case, 
one  being  marked  "Original"  and  the  other 
"Duplicate,"  and  both  being  marked  "Not  ne- 
gotiable or  transferable."  The  certificates 
wore  not  made  with  express  reference  to  any 
particular  contract,  and  the  aeposits  were 
subject  to  be  treated  as  security  for  the  ful- 
fillment of  any  contracts  made  between  the 
parties  to  +he  respective  certificates,  during 
the  time  the  deposit  remained  unpaid. 

During  May.  18S2,  Barber,  at  the  instance 
and  re(iuf'st  of  "^A'hite,  made  contracts  for  the 


sale  and  delivery  by  Barber  to  divers  persons, 
members  of  such  board  of  trade,  of  large  quan- 
tities of  No.  2  spring  wheat,  for  delivery  at 
seller's  option  during  July,  1882,  at  certain 
prices  specified  in  the  various  contracts,  ran- 
ging from  $1,221/2  per  bushel  to  $1.2.51/8  per 
bushel,  which  wheat  was  to  be  delivered  in 
lots  of  .5,000  bushels.  W^hite  did  not  put  Bar- 
ber in  funds  to  buj^  wheat  for  delivery  accord- 
ing to  the  contracts.  While  Barber  remained 
liable  upon  the  contracts,  he  was  from  time 
to  time  called  upon  to  deposit  margins  on 
account  of  the  contracts,  to  secure  their  per- 
formance, and  did,  in  accordance  witli  the 
rules  of  the  board  of  trade,  and  in  compliance 
with  his  duties  under  the  contracts,  make  de- 
posits of  money  and  procure  certificates  there- 
for from  the  Merchants'  Bank  of  Canada. 
The  answer  then  gives  the  particulars  of  12 
different  certificates  for  such  deposits  on  vari- 
ous contracts,  amounting  in  the  aggi'egate  to 
$r.,70<).  The  contracts  for  the  delivery  dur- 
ing July,  1882.  of  No.  2  spring  wheat,  were 
not  performed  by  White,  me  moneys  de- 
posited as  margins  were  furnished  by  Barber 
in  large  part  from  his  own  means,  for  the 
purpose  of  keeping  the  contracts  open,  as  was 
desired  by  White.  Barber  also,  in  order  to 
avoid  loss  by  White,  and  to  protect  the  in 
terests  of  White,  made,  before  the  close  of 
July,  1882,  a  tender  of  No.  2  red  winter  wlieat 
under  the  contracts,  which  wheat  was  of 
greater  intrinsic  value,  as  Barber  believed, 
than  No.  2  spring  wheat;  but  the  tender  was 
rejected  by  the  purchasers,  on  the  ground  that 
the  wheat  tendered  was  not  of  the  kind  and 
grade  contracted  to  be  delivered,  nor  such  as, 
under  the  rules  of  the  board  of  trade,  was 
necessary  to  be  delivered.  The  parties  with 
whom  the  contracts  had  been  made,  and  who 
had  the  right  to  call  for  delivery,  made  large 
claims  for  damages  against  Barber,  and  in- 
sisted that  the  tender  was  irregular  and  in- 
sufficient; and  White  desired  Barber  to  ob- 
ject to  the  payment  of  such  claims,  and  to 
reduce  the  same,  if  he  could.  With  this  ob- 
ject in  view.  Barber,  at  the  instance  of  White, 
filed  a  bill  in  chancery  in  the  superior  court 
of  Cook  countj%  on  September  11,  1SS2. 
against  tlie  board  of  trade,  seeking  by  the  bill 
to  impeach  the  regularity  and  fairness  of  an 
award  01  decision  of  a  committee  which  had 
been  appointed,  under  the  rules  of  the  board 
of  trade,  to  determine  the  settlement  price  un- 
der contracts  such  as  those  which  were  so 
made  by  Barber  and  whicn  committee  had 
determined  that  such  settlement  price  should 
be  $1.35  per  Inishel.  The  bill  also  sought  to 
restrain  the  board  of  trade  from  enforcing 
such  award  or  disciplining  Barber  on  account 
of  non-compliance  therewith.  An  injunction 
was  temporarily  granted  on  the  bill.  The 
award  made  Barber  liable  to  pay,  as  dam- 
t  ages,  to  the  parties  with  whom  he  had  made 
the  contracts,  the  difference  between  the  con- 
tract price  and  the  settlement  price  of  $1..35 
per  bushel.  The  suiierior  court  of  Cook  coun- 
ty adjudged  in  the  suit  that  Barber  was  not 


ILLEGAL  SALES. 


321 


onritled  to  any  relief  on  account  of  any  of  the 
njatters  stated  in  the  bill,  and  the  injunction 
was  dissolved  on  April  1V>,  18Sy.  The  bill 
was  drawn  up  by  counsel  employed  by  White, 
White  knowing  that  if  the  injunction  should 
be  dissolved  Barber  would  be  required  lo  set- 
tle on  the  basis  of  the  award  of  the  committee. 
With  reference  to  that  basis,  White  drew 
from  Barber,  on  October  30,  1882,  $987.50,  as 
an  excess  of  money,  including  prolits,  due  to 
him  from  Barber  after  reserving  enough  to 
pay  damages  at  that  rate. 

Prior  to  the  bringing  of  the  suit  in  chan- 
cery, it  was  the  right  of  the  iiarties  with 
whom  Barber  had  entered  into  the  contracts 
to  have  the  moneys  which  had  been  deposited 
as  u'.argin  or  security  under  the  contracts  paid 
over  to  them  on  the  order  of  the  president 
of  the  board  of  trade,  they  holding,  respec- 
tively, duplicates  of  the  certificates;  and  Bar- 
ber, on  making  default  as  to  the  delivery,  be- 
came amenable  to  discipline  under  the  rules 
of  the  board  of  trade,  for  not  complying  with 
the  terms  of  tht  contracts.  One  of  those 
rules  provided  that,  when  any  memoer  of  the 
association  failed  to  comply  promptly  with 
the  terms  of  any  business  contract  or  obliga- 
tion, and  failed  to  equitably  and  satisfactorily 
adjust  and  settle  the  same,  he  should,  upon 
admission  or  proof  of  such  delinquency  be- 
fore the  board  of  directors,  be  by  them  sus- 
pended from  all  privileges  of  the  association 
until  all  his  outstanding  obligations  to  mem- 
bers of  the  board  of  trade  should  be  adjusted 
and  settled.  The  parties  who  were  entitled 
to  delivery  of  the  wheat  under  the  contracts 
for  delivery  in  .Tuly,  1882,  were,  by  these  rules, 
entitled  to  settlement  with  Barber  at  the  aver- 
age market  price  of  the  commodity  on  Julj' 
31,  1882,  the  day  of  the  maturity  of  the  con- 
tracts, and  the  damage  or  loss  due  to  such 
purchaser  by  reason  of  the  required  settle- 
ment became  thereupon  immediately  due  and 
payable  by  Barber  to  such  purchasers;  but 
the  payment  was  delayed  because  cl  differ- 
ence of  opinion  as  to  the  amount  of  damages, 
and  in  order  to  enable  White  to  obtam.  If 
possible,  a  reduction  of  them;  and  this  was 
the  object  of  the  suit  in  chancery  against  the 
board  of  trade.  It  was  also,  under  those  rules, 
the  right  of  such  purchasers,  after  a  failure 
for  three  business  days  succeeding  the  ma- 
turity of  the  contracts,  to  cause  to  be  sub- 
mitted to  a  select  committee  of  three  members 
of  the  board  any  dispute  between  Barber  and 
such  purchasers,  with  reference  to  any  deposit 
of  moneys  applicable  to  the  contracts;  and 
the  decision  of  a  majority  of  the  committee, 
reported  to  the  president  of  the  board,  would 
liave  determined  in  what  manner  ana  to 
whom  the  deposit  should  be  paid;  and  there- 
upon the  president  would  have  been  author- 
ized by  the  rules  to  make  an  order  for  the 
payment  of  the  deposit  in  accordance  with 
the  decision  of  the  committee,  which  order 
would  have  been  a  sufficient  warrant  to  the 
bank  by  which  the  certificates  were  issued,  to 
pay  the  money  in  accordance  with  the  order; 

VAN  ZTLE  SEL.CAS.SAT>ES — 21 


but  action  before  the  board,  as  against  Barber, 
was  postponed  because  of  the  injunction,  and 
the  certificates  of  deposit  for  margin  and  se- 
curity, so  issued,  having  peference  to  such 
wheat  contracts,  were  held  over  in  view  of 
the  injunction.  After  its  dissolution,  the  pay- 
ment of  the  margins  or  security  moneys  rep- 
resented by  the  certificates  was  subject  to  be 
enforced  under  the  rules  of  the  board  of  trade, 
and  Barber  was  in  danger  of  being  suspended 
from  the  privileges  of  the  board  because  of 
the  non-settlement  of  the  conti'acts.  White 
had  due  notice  of  all  the  foregoing  facts,  out 
failed  to  protect  Barber  or  to  give  him  any 
guaranty  for  his  protection.  The  liability  to 
suspension  from  membership  of  the  board  of 
trade  was  one  of  great  consequence  to  Barber 
in  a  mouetarj'  point  of  view,  as  well  as 
with  reference  to  his  standing  and  reputation 
as  a  merchant,  for  such  suspension  would 
have  operated  as  practically  a  forfeiture  of 
his  membership,  so  long  as  the  contracts  re- 
main unsettled.  The  fee  for  membership  was 
fixed  by  the  rules  of  the  board  at  $10,000,  and 
any  permanent  suspension  of  Barber  trom  the 
membership  of  the  board  would  have  caused 
a  loss  to  him  of  even  more  than  $10,0fX),  be- 
cause it  AA'ould  have  interfered  with  his  liveli- 
hood and  business.  He  could  not,  cous-istent- 
ly  with  his  rights  or  duties  as  a  member  of 
the  board,  defer  an  adjustment  or  senicment 
of  the  contracts  any  longer  than  was  neces- 
sary to  determine  what  he  would,  under  the 
rules  of  the  board,  be  requirea  to  do  in  respect 
to  such  settlement. 

In  order  +o  accommodate  White  as  far  as 
possible.  Barber  delayed  making  settlement 
r.ntil  after  complaint  was  made  againsi  him 
before  the  board,  in  pursuance  of  its  rules; 
and  he  allowed  the  complaint  to  proceea  to  a 
hearing,  at  which  he  attempted  to  make  de- 
fense as  to  one  of  the  contracts,  setting  up. 
among  other  matters,  such  tenner  cf  y.o.  2  red 
winter  wheat;  but  the  board  ruled  against 
him,  and  was  about  to  direct  his  suspension 
from  membership  unless  he  made  settlement. 
Tliereupon,  on  the  twenty-fouith  of  April, 
1883,  he  settled  such  of  the  contracts  as  were 
then  outstanding,  making  such  settlement  in 
accordance  with  the  rules  of  the  beard,  and  on 
his  making  it  the  deposits  for  margins  and 
security  pertaining  to  the  contracts  were  lib- 
erated, and  on  the  return  to  the  bank  of  the 
original  margin  certificates,  so  issued  by  the 
Merchants'  Bank  of  Canada,  the  certificates 
being  indorsed  to  the  bank,  it  gave  to  Bar- 
ber credit  for  the  moneys  on  his  account  as 
a  depositor  in  the  bank.  White  caused  Bar- 
ber to  make  the  contracts,  and  to  become 
bound  for  their  perfoimance,  and  made  it  nec- 
essary for  Barber  to  put  up  margins  and  se- 
cuiity,  and  thus  placed  it  out  of  the  power 
of  Barber  to  control  such  margins  and  se- 
curity in  any  other  way  than  according  to  the 
rules  of  the  board  of  trade,  and  also  so  in- 
volved Barber,  in  causing  him  to  become 
amenable  to  discipline  by  or  suspension  from 
the  board  of  trade,  that  White  could  not  legal- 


322 


ILLEGxVL  SALES. 


ly  or  equitably  revoke  the  authority  of  Bar- 
ber to  make  settlement  of  the  contracts  or 
pay  over  the  moneys  when  it  became  neces- 
sary to  settle  the  contracts.  The  contracis 
were  lej^al,  and  the  provisions  of  the  rules  of 
the  board  of  trade  applicable  thereto  were 
bindiiiK  upon  Kaiber,  and  were  necessary  and 
proper  to  be  considered  with  reference  to  his 
duties  and  ii{;hts,  as  between  himself  and 
the  other  contracting  parties,  and  as  between 
himselil  and  White. 

Barber  avers  that  it  was  his  right  to  pay 
damages  or  differences  on  default  under  the  con- 
tracts, when  such  damages  became  due,  ac- 
cording to  the  rules  of  the  board  of  trade;  that 
such  right  imu'ed  to  him  by  direct  authority 
fi'om  White,  when  the  contracts  were  made  at 
the  instance  of  White,  and  the  moneys  were 
paid  or  advanced  to  Barber;  and  that  thereaft- 
er there  A\as  no  time  when  White  had  any  right 
or  authority  to  revoke  the  power  to  pay  over 
the  moneys,  when,  in  the  course  of  trade,  or 
in  accordance  with  the  rules  of  the  board  of 
ti'ade,  it  became  necessary  to  pay  them  over,  in 
making  settlement  of  the  contracts  on  which 
White  defaulted,  and  which  it  became  neces- 
sary for  Barber  to  adjust,  because  he  had  be- 
come a  party  thereto  at  the  instance  of  White; 
that  the  contracts  in  question  were  but  a  small 
part  of  the  dealings  which  were  had  by  ^Mnte 
through  Barber,  as  his  commission  merchant, 
with  various  members  of  the  board  of  trade; 
that  in  many  of  those  dealings,  which  were  car- 
ried on  contemporaneously  with  the  dealings  in 
question,  there  was  profit  to  White,  and  White 
received  from  Barber,  on  account  thereof,  large 
sums  of  money,  representing  such  profits;  and 
that  it  would  be  inequitable  for  White  to  claim 
that  he  should  be  relieved  at  the  expense  of  Bar- 
ber from  the  effects  of  the  contracts  for  the  de- 
livery of  No.  2  spring  wheat  in  July,  1882, 
which  remained  open  at  the  close  of  that  month 
lA'cause  of  the  non-fulfillment  thereof  on  the 
part  of  White,  while  White  had  received  profits 
from  other  contracts  of  a  similar  character, 
made  for  him  by  Barber,  which  White  chose 
to  have  settled  and  closed,  when  the  same  re- 
sulted in  profits  which  were  to  be  paid  to  White 
by  Barber. 

Replications  were  put  in  to  these  two  an- 
swers, and,  in  .January,  1884,  the  suit  was  re- 
moved by  Barber  into  the  circuit  court  of  the 
United  States  for  the  Northern  district  of  Illi- 
nois. Afterwards,  it  was  stipulated  that  the 
money  might  remain  in  the  hands  of  the  bank 
\mtil  the  final  disposition  of  the  cause,  subject 
to  like  order  by  the  court,  as  if  the  money  were 
jjaid  into  the  registry  of  the  court,  and  an  order 
was  made  dismissing  the  bank  from  the  litiga- 
tion, as  well  in  the  suit  at  law  connnenced 
against  it  by  White,  as  in  the  interpleader  suit. 

By  a  further  stipulation,  made  in  May,  18^, 
the  testimony  taken  in  the  suit  at  law  before 
mentioned,  of  White  against  Barber,  to  recov- 
er the  .$11,412.50,  at  the  trial  which  took  place 
in  February.  1884,  was  used  and  introduced  by 
tlie  party  taKing  the  same,  as  liis  testimony  on 
the  trial  of  the  suit  in  ecpiity.      Such  testimony 


consisted  of  the  detailed  examination  of  the  wit- 
nesses examined  on  the  trial  of  the  suit  at  law, 
and  of  documentaiy  testimony,  the  substance 
of  which  examinations  and  documentary  testi- 
mony is  given  in  the  bill  of  exceptions  in  the 
suit  at  law,  and  is  hereinbefore  recited.  TO' 
this  were  added,  in  the  suit  in  equity,  the  fur- 
ther depositions  of  White  and  Barber,  taken 
therein  in  ^lay,  1884.  In  these  supplementary 
depositions,  each  party  goes  over  with  greater 
particularity  the  matters  pi'eviously  testified  to 
by  him,  as  set  forth  in  the  bill  of  exceptions;  but 
nothing  is  substantially  added  throwing  light 
upon  the  merits  of  the  dispute.  By  the  same- 
stipulation,  there  was  put  in,  as  part  of  the  tes- 
timony on  behalf  of  Barber,  a  copy  of  the  pro- 
ceedings and  judgment  in  the  suit  at  law  above 
mentioned,  brought  by  White  against  Barber  to 
recover  the  .$11,412.50.  In  May,  1884,  a  final 
decree  was  made  in  the  suit  in  equity,  ad- 
judging that  Barber  was  entitled  to  the  $(j,70iJ, 
and  ordering  that  it  be  paid  to  him.  From  that 
decree  White  has  appealed  to  this  court. 

L.  M.  Ninde,  for  appellant.  Thomas  Dent, 
for  appellee. 

Mr.  Justice  BLATCIIFORD,  after  stating 
the  facts  as  above,  delivered  the  opinion  of  tlie 
court. 

The  only  question  involved  in  the  suit  at  law 
is  as  to  the  correctness  of  the  charge  to  the  jury 
in  the  particulars  specially  excepted  to.  The 
proper  constiiiction  of  the  statute  of  Illinois 
(section  130,  c.  38,  Rev.  St.)  was  determined 
by  the  supreme  comt  of  Illinois  in  Wolcott  v. 
Heath,  78  111.  4.33,  in  the  passage  from  the  opin- 
ion in  that  case  quoted  by  the  circuit  court  in 
its  charge  to  the  jury.  According  to  that  con- 
stiiiction,  the  contracts  for  the  sale  of  No.  2 
spring  wheat,  deliverable  in  July.  1882,  made 
by  Barber,  were  not  void  as  gambling  contracts, 
if  they  were  bona  fide  contracts  for  the  actual 
sale  of  grain,  and  if  the  only  option  the  seller 
had  was  as  to  the  time  of  deliveiy,  the  obliga- 
tion assimied  by  Barber  being  to  deliver  the 
gram  at  aU  events,  with  the  option  only  to  de- 
liver it  at  any  time  before  the  close  of  business 
on  the  last  day  of  July,  1882.  That  the  con- 
tracts made  by  Barber  were  of  that  character, 
and  were  not  such  gambling  contracts  as  the 
statute  denounces,  must  be  held  to  have  been 
found  by  the  jury  under  the  portions  of  the 
charge  specially  excepted  to,  and  under  other 
portions  of  the  charge  contained  in  the  record. 
The  plaintiff  did  not  pray  for  any  instructions 
to  be  given  to  the  jm*y,  nor  did  he  present  to 
the  court  any  propositions  of  law  which  he 
maintained  tlie  com-f  should  lay  before  the  jmy 
as  guides  to  a  proper  solution  of  the  questions 
in  controversy.  The  general  exception  to  the 
whole  of  the  charge  cannot  be  regarded,  as  it 
is  a  violation  of  rule  4  of  this  court. 

In  its  charge  to  the  jmy.  the  circuit  court 
explained  fuUy  to  them  the  theory  of  White,— 
that  the  dealings  on  account  of  which  Barber 
paid  out  the  moneys  in  question  were,  as  be- 
tween White  and  Barber,  gambling  or  wager 
contracts,  and,  therefore,   ill(>gal.      It  presented 


ILLEGAL  SALES. 


J23 


fairly  to  them  a  statement  of  the  testunony  on 
both  sides  of  tliat  question,  as  set  forth  in  the 
bill  of  exceptions.  It  also  submitted  to  them 
the  question  whether,  in  view  of  the  testimony, 
the  contracts  in  question  were  contracts  to  buy 
or  sell  at  a  future  day,  or  whether  they  were  ab- 
solute sales,  in  which  the  seller  had  the  entire 
mouth  of  July,  1SS2,  in  which  to  perform  his 
contracts;  and  it  instructed  them  that  if  they 
should  find  that  the  dealings  by  the  defendant 
for  the  plaintiff  Avere  options  to  buy  or  sell  at  a 
future  daj',  their  verdict  should  be  for  the  plain- 
tiff; but  that  if,  on  the  contrary,  they  should 
find  that  such  dealings  were  contracts  by  which 
the  grain  was  to  be  absolutely  delivered  during 
the  mouth  of  July,  1SS2,  the  only  option  being 
the  time  when,  during  the  month,  the  delivery 
should  be  made,  their  verdict  should  be  for  the 
defendant.  This  charge  was  very  favorable 
to  the  plaintiff",  for  it  necessarily  involved  an 
affirmation  of  the  propositions  that  the  plaintiff 
had  a  right  to  revoke  his  action  in  advising  the 
tender  of  the  No.  2  red  winter  wheat  in  fulfill- 
ment of  the  contracts,  and  had  a  right  to  revoke 
his  express  or  implied  assent  to  the  appoint- 
ment of  the  committee,  under  the  rules  of  the 
board  of  trade,  to  determine  what  Avas  a  fair 
settling  price  for  the  Avheat  ou  the  thiity-firet 
of  July,  1882,  and  had  a  right  to  recall  his  con- 
nection with  the  chancery  suit  brought  by  Bar- 
ber against  the  board  of  trade,  in  which  the 
validity  of  the  contracts  was  recognized,  and 
had  a  right  to  ignore  the  fact  that  he  had  placed 
Barber  in  the  position  in  which,  at  the  time  of 
the  giving  of  the  notice  of  April  2,  1883,  by 
White  to  Barber,  Barber  was  uot  at  liberty  to 
refuse  payment  of  the  damages  arising  out  of 
the  non-fulfihment  of  the  contracts,  but  was  in 
danger  of  being  expelled  from  the  board  of 
ti-ade,  if  he  persisted  in  such  refusal. 

The  jury  must  have  found,  on  the  testimony, 
that  the  contracts  made  by  Barber  for  the 
plaintiff"  at  the  board  of  trade  were  valid  con- 
tracts, aud  that  Barber  was  liable  on  them  to 
either  deliver  the  grain  or  pay  the  damages  in 
case  he  failed  to  deliver,  because  the  court  char- 
ged the  juiy  that,  if  the  proof  satisfied  them 
that,  by  the  conti-acts,  Barber  was  liable  to  ei- 
ther deliver  the  grain  or  pay  the  damages,  then 
the  contracts  were  not  gambling  contracts,  and 
they  should  find  for  the  defendant.  We  find 
no  error  in  the  record  in  the  suit  at  law,  and 
the  judgment  is  affirmed. 

In  the  suit  in  equitj%  the  contention  on  the 
part  of  'S^'hite  is  that  the  contracts  and  transac- 
tions between  Barber  and  himself  were  wager- 
ing contracts,  and,  therefore,  void,  and  that  the 
$(J,TOO  was  subject  to  the  demand  of  AVhite,  if 
such  contracts  were  void.  It  is  urged  on  the 
liart  of  White  that  the  wheat  was  sold  by  Bar- 
l)er  for  him  without  any  intention  on  the  part 
of  either  of  them  that  there  should  l)e  any  de- 
livery thereof,  but  with  the  intention  that  the 
ti'ausactions  should  be  settled  by  the  payment 
of  the  differences  between  the  prices  at  which 
the  wheat  was  sold  and  its  prices  at  the  times 
stipulated  for  its  dehvery.  White  testifies  that 
such  was  his  understanding,  communicated  to 


Barber  before  Barber  made  the  contracts  of 
sale.  Barber  testifies  that  he  has  no  recollection 
of  anything  of  the  kind.  The  evidence  as  to 
what  White  did  in  connection  with  the  transac- 
tions is  inconsistent  with  White's  version,  and  it 
clearly  appears  that  Barber  had  no  such  un- 
derstanchng. 

The  defense  set  up  in  the  answer  of  Barber 
is  proved  to  eveiy  substantial  intent,  and  the 
facts  therem  set  forth  constitute  a  valid  bar  to 
the  suit  of  White.  The  evidence  shows  that 
White,  in  advance,  required  that  Barber  should 
trade  with  parties  whom  he  knew  to  be  respon- 
sible; that  in  each  case  he  gave  special  direc- 
tions to  Barber  to  buy  or  to  sell,  as  the  case 
might  be,  and  left  it  to  Barber  to  put  the  con- 
tract in  form,  these  directions  being  generally 
given  by  telegrams  from  White  at  Fort  Wayne 
to  Barber  at  Chicago;  that  it  was  understood 
between  them  that  Barber  should  buy  or  sell  at 
the  Chicago  board  of  tirade;  that  Barber,  in  all 
cases,  obeyed  the  orders  of  White;  that  White 
controlled  the  trades  which  Barber  made;  that, 
unless  the  margin  AA'as  exhausted.  Barber  was 
not  to  close  out  White's  trades  until  White  di- 
rected him  to  do  so;  that  it  was  undei-stood 
that  Barljer  was  to  observe  the  rales  of  the 
board  of  trade;  that  White  knew  that  Barber, 
as  a  member  of  such  board,  making  such  con- 
tracts on  the  board  for  White,  would  be  obliged 
to  observe  those  rules;  that  White  directed  Bar- 
ber when  to  cover  and  when  to  close  trades, 
and  that  Barber  observed  his  orders;  that 
White  acted  on  his  own  judgment  in  making 
the  sales  of  Avheat  for  deliveiy  in  July,  1882; 
that,  when  the  contracts  for  those  sales  had 
matured,  White  approved  of  the  tender  being 
made  of  No.  2  red  winter  wheat;  that  subse- 
quently, on  August  5,  1882,  White  telegraphed 
to  Barber  from  Port  Wayne,  directing  him  not 
to  cancel  the  July  trades,  and  saying  that 
Wliite's  attorneys  at  Fort  Wayne  believed  that 
si;ch  tender  was  good,  and  could  be  enforced: 
and  that,  on  the  fifteenth  of  August.  .1882, 
White,  in  a  letter  to  Barber,  stared  that  his  at- 
torney at  Fort  Wayne  had  examined  the  subject 
of  the  July  deals  in  connection  with  the  rules  of 
the  board  of  trade,  and  had  concluded  that  the 
delivery  which  Barber  had  tendered  was  good, 
and  was  "binding  on  the  buyer,  and  that  we 
can  collect  the  difference  in  court."'  It  also 
appears  that  Barber  was  unwilling  to  default 
on  the  conti-acts  lest  it  should  injure  his  reputa- 
tion on  the  board  of  trade,  and  that  he  defauhed 
on  them  because  White  insisted  that  he  should 
do  so.  White  knew  of  the  rale  of  the  board  of 
trade  under  Avhich  a  committee  could  be  ap- 
pointed to  determine  Avhat  was  a  fair  iirice  for 
property  to  be  delivered,  and  was  wilhng  to 
leave  it  to  such  committee.  After  the  commit- 
tee had  fixed  the  price  at  $1.35  per  bushel, 
White  was  advised  of  this  action,  and  deter- 
mined that  legal  proceedings  should  be  taken 
to  set  aside  the  award  of  the  committee.  It 
was  in  pursuance  of  the  wish  of  White  that  tlie 
cliancery  suit  was  brought  by  Barber  against 
the  board  of  trade,  to  enjoin  all  action  under 
such  award.     In  that  suit,  an  injunction  was 


um 


ILLEGAL  SALES, 


»htained  to  roslinin  such  action,  which  injuuo- 
"ion  remained  in  force  until  the  delenninution 
\>y  tlie  supreme  court  of  IHinois  of  a  suit 
orought  by  one  Wriijht  against  the  ))(,iar(l  of 
trade  (15  Chi.  I^eg.  X.  23U),  it  having  been  stip- 
ulateil  tliat  the  suit  of  Barber  against  the  board 
of  trade  sliould  abide  the  final  residt  of  the 
Wright  suit.  The  latter  suit  was  decided  in 
favor  of  the  board  of  trade.  After  all  this  liad 
occurred,  White  deteruiiued  to  repudiate  his 
obligations  to  Barber,  and,  on  the  second  of 
April,  1SS3,  he  served  on  Barber  the  written 
notice,  claiming  tbat  the  contracts  for  the  s:ile 
of  the  wheat  were  illegal  and  void,  and  forl)id- 
diug  Barber  to  paj-  over  any  part  of  the  $11,- 
412. r.O  to  any  one  but  White,  and  deuuindiug 
the  immediate  payment  of  it  to  him.  On  the 
twentieth  of  April,  1SS3,  Barber,  having  b(H!n 
notified  of  complaints  made  against  him  before 
the  boai'd  of  trade,  under  its  rules,  wliich  pro- 
vided for  the  hearing  of  complaints  and  for  sus- 
pension or  expulsion  in  case  of  noncompliance 
with  contrac-ts,  notified  White  in  writing  of 
these  facts,  and  asked  White  if  he  could  pro- 
tect him  (Barber)  in  any  way.  Not  receiving 
such  protection.  Barber,  on  the  twenty-fourth 
of  April,  188.3,  paid  out  the  moneys  necessary 
to  satisfy  the  damages  on  the  contracts,  and 
thei-eby  relieved  himself  from  being  sust)ended 
from  membei-ship  in  the  board  of  trade.  He 
had  no  alternative  but  to  pay  the  money  or 
lose  his  business,  and  also  lose  a  sum  of  mon- 
ey, in  the  value  of  his  membership  in  the  board 
of  trade,  equal  to,  if  not  greater  than,  the 
amount  in  contToversy  in  this  suit.  He  had 
acted  strictly  according  to  the  instructions  he 
had  received  from  White,  ^^'hite  had  left  the 
money  in  his  hands  for  the  express  purpose  of 
paying  such  damages  as  the  committee  of  the 
board  of  trade  should  find  to  be  due.  Barber 
retained  the  money  in  order  to  allow  White  to 
obtain  some  benefit,  if  he  could,  from  thy  suit 
in  chanceiy  brought  by  Baiber.  By  that  suit, 
and  by  the  suit  of  Wright,  all  legal  means  were 
exhausted,  leaving  the  rights  of  the  purchas- 
ers under  the  contracts  of  sale  to  be  enforced 
according  to  the  rales  of  the  board  of  trade  un- 
der whicli  they  were  made.  The  payinent  of 
the  money  by  Barber  in  satisfaction  of  those 
damages  was,  imder  the  circumstances,  de- 
manded by  every  principle  of  law  and  of  equity, 
and  no  right  was  left  in  AVhite  to  claim  the  $(>.- 
TOO. 

White  had  no  right  to  forbid  the  payment  of 
the  money  by  Barber,  or  to  recall  it  from  its 
destination.  The  money  is  to  be  regarded  as 
having  been,  for  all  practical  purposes,  irrevo- 
cal)ly  set  apart  by  ])oth  White  and  Barber  for 
the  payment  of  such  damages,  prior  to  the  giv- 
ing of  the  notice  by  White  to  Barber  on  the 
.second  of  April,  1S83.  White  had  caused  Bar- 
ber to  make  tlie  contracts,  and  to  become  bound 
for  their  performance,  and  had  made  it  neces- 
saiy  that  Barber  sliould  put  up  the  margins 
and  secm-ity,  and  had  thus  jjljiced  it  out  of  the 
power  of  Bai'ber  to  control  the  margins  and 
security  iu  any  other  M-ay  than  according  to 
the  rules  of  the  board  of  u-ade,  in  subordina- 


tion to  which  White  as  well  as  Barber  had  act- 
ed throughout.  It  was  obedieu  ■;'  to  the  orders 
of  ^^'lute  which  had  made  Barber  subject  to 
suspension  or  expulsion  by  the  board  of  trade. 
The  .f 0,700  had  been  put  up  ]>y  Barber  as  mar- 
gins, under  the  rules  of  the  l)oard  of  trade,  prior 
to  the  giving  of  the  notice  of  April  2,  18S3.  and 
thus  had  been  before  that  time  devoted  l).\- 
White  as  well  as  Barber  to  the  purpose  of  pay- 
ing the  damages  under  the  niles  of  the  board  of 
trade.  For  the  reasons  thus  stated,  we  are  of 
oi)inion  that  the  claim  of  White  sought  to  be 
enforced  in  this  suit  in  ecpiity  cannot  be  allow- 
etl. 

A  claim  is  made  on  the  part  of  White  that  he 
can  recover  this  money  under  the  provisions  of 
section  132,  c.  38,  Rev.  St.  111.  (Ilurd,  Rev.  St. 
Ed.  1883,  p.  394;  Ed.  188ri,  p.  405).  That  sec- 
tion provides  that  "any  person  who  shall  at 
any  time,  *  *  *  ^y  any  wager  or  bet  up- 
on any  *  *  *  unknown  or  contingent  event 
whatevt  r,  lose  to  any  person  so  *  *  *  bet- 
ting any  sum  of  money,  *  *  *  amounting 
in  the  whole  to  the  sum  of  $10,  and  shall  pay 

*  *  *  the  same  or  any  part  thereof,  the  per- 
son so  losing  and  paying  *  *  *  the  same 
shall  be  at  liberty  to  sue  for  and  recover  the 
moiu-y  *  *  *  so  lost  and  paid,  *  *  *  q^. 
any  part  thereof,     *     *     *     by  action  of  debt. 

*  *  *  from  the  winner  thereof,  with  costs,  in 
any  court  of  competent  jm-isdiction."  It  is  a 
sutficient  answer  to  this  claim  to  say  that  Bar- 
Iter  was  not  the  "winner"  of  any  money  from 
White. 

There  is  a  further  view  applicable  to  this  case, 
arising  out  of  the  decision  of  this  court  in  Hig- 
gins  V.  ilcCrea,  116  U.  S.  071,  6  Sup.  Ct.  557. 
In  that  case,  Higgius,  the  broker  of  McCrea. 
sued  him  to  recover  moneys  which  Higgins  had 
paid  for  the  purchase,  at  the  Chicago  board  of 
trade,  of  pork  and  lard,  on  the  instnicHon  of 
IMcCrea,  iu  Maj-,  1883,  deliverable  iu  August. 
1883.  on  such  day  as  the  seller  might  elect.  In 
his  ansAver,  McCrea  set  up  that  he  had  engaged 
with  the  plaintiff  in  gambling  ti'ansactions,  and 
tliat  the  contracts  which  the  plaintiff  had  made 
Avere  not  contracts  for  the  actual  dellveiy  of 
any  merchandise,  but  were  pretended  purchases 
and  mere  options,  and  that  it  was  the  under- 
standing of  all  the  parties  to  the  transactions 
that  no  merchandise  should  be  delivered  on  the 
contracts,  but  that  the  same  should  be  settled 
ui)on  the  differences  between  the  contract  prices 
and  the  market  prices.  On  this  basis,  McCrea 
claimed,  by  way  of  counter-claim,  to  recover 
judgment  against  the  plaintiff  for  the  sum  of 
nearly  $20,(XX),  wliich  he  alleged  he  had  paid 
to  the  plaiutiff  to  carry  on  such  gambling  trtms- 
actions  and  to  purchase  option  contracts.  The 
plaintiff  denied  the  version  thus  given  by  the 
defendant  of  the  ti'ansactions.  The  circuit  court 
had  instructed  the  juiy  that  the  defendant  was 
entitled  to  recover  upon  his  counter-claim,  and 
he  had  a  judgment  accordingly.  This  court 
held  that  the  case  of  the  defendant,  as  stated 
by  himself  in  his  answer  and  counter-claim, 
was  that  the  money  was  advanced  by  him  to 
cany  on  a  gambling  transaction;   that  with  his 


ILLEGAL  SALES. 


32.> 


foiK-urn  lice  the  niouoy  so  advancod  was  used 
in  sii.li  .trambliup:  trausiiction;  and  tlmt,  by  tlv 
statute  of  Illinois,  where  the  coutfacls  wei-e 
made,  they  were  tre:ited  as  gambling  coutracts. 
and  were  void;  Tint  the  counter-claim  thus  stat 
«l  was  supiM)r;ed  by  the  testunony  of  the  de- 
fendant giv(  n  on  the  trial;  that  there  was  no 
statute  of  Illinois  to  authorize  the  recoveiy  of 
mouc'.v  paid  on  such  contracts;  and  that  no  re- 
covery could  be  had  by  the  defendant.  This 
court  s;iid  in  its  opinion;    '"AVe  do  not  see  on 


what  ^iiuund  a  party  who  says  in  his  ploadinj: 
that  tlie  money  which  he  seeks  to  recover  v\-ns 
paid  out  for  the  accomplishment  of  a  purpose 
made  an  offense  by  the  law,  and  who  testifies 
and  insists  to  the  end  of  his  suit  tlnit  the  con- 
tract on  which  he  advanced  his  money  Avas  il- 
legal, criminal,  and  void,  can  recover  it  back 
in  a  couit  whose  duty  it  is  to  give  effect  to  the 
law  which  the  party  admits  he  intended  to  vio- 
late." 
The  decree  of  the  circuit  court  is  affirmed. 


326 


ILLEGAL  SALES. 


DOWS.'t  nl.  V.  (^.LASPEL.  | 

(00  \.  \V.  CO.  4  N.  I).  251.) 
Siii)rome  Court  of  North  Dakota.    Aug.  3,  1894.  j 

Appeal  from  tlistriot  court,  Stutsman  couii-   ; 
ty;    Koderick  Hose.  .luilj,'!-. 

Actiou  by  David  Dows,  .Jr..  ami  (Jcorj,'e  B. 
Cooksey,  eopartners  as  David  Dows,  Jr.,  &  i 
Co..  aj,'aiiist  Samuel  L.  Glaspid.  to  recover  \ 
commissions  and  advances  made  by  plaintiffs 
on  account  of  the  sale  and  purchase  of  wheat 
by  them  as  defendant's  a.i;ents,  in  which  de- 
fendant set  up  a  com)terclaim.  From  a  judg- 
ment for  defendant  in  the  main  case,  and 
against  defendant  on  his  counterclaim,  and 
also  disallowin,u:  costs  to  defendant,  both  par- 
ties appeal.  Modified  as  to  costs,  and  affirm- 
ed. 

Ball  &  Watson  and  White  &  Hewitt,  for 
plaintiffs.  E.  AV.  Camp  and  S.  L.  Glaspel, 
for  defendant. 

CORLISS.  J.    The  plaintiffs  are  seeking  to 
recover  judiiinent  against  defendant  for  their 
commissions  and  for  advances  made  by  them 
on  account  of  the  sale  and  pmx-hase  of  wheat 
by  them  as  agents  for  defendant.    Thus  far 
they  have  been  unsuccessful.    The  case  was 
tried  before  the  court,  and  judgment  was  ren- 
dered in  favor  of  the  defendant.    The  find- 
ings of  the  court  amply  sustain  the  judgment. 
But  it  is  here  urged  that  the  evidence  does 
not  jiLstify  certain  of  the  findings.    The  de- 
fense relied  on  was  that  the  transactions  in 
which  the  plaintiffs  claim  to  have  paid  out 
moneys  for  the  defendant  were  mere  wagers 
on  the  price  of  wheat,  and  that  the  plaintiffs 
knew  that  the  sole  purpose  of  defendant  was 
to  g.nuble  in  wheat  options,  and  not  to  enter 
into  bona  fide  wheat  contracts  in  which  wheat 
was  to  be  delivered  to  or  by  him  thereun<ler. 
The  plaintiffs  were  commission  merchants  in 
the  city  of  Duluth,  Minn.,  and  were  members 
of  the  Duluth  Board  of  Trade.    The  defend- 
ant was  and  is  an  attorney  in  full  practice, 
residing    and    carrying    on    his    professional 
business  at  Jamestown,  N.  D.    In  Si-ptembLn-, 
188"),    the    defendant    commenced     shipping 
wheat  to  plaintiffs,  to  be  sold  by  them  for 
him  in  Duluth.    These  shipments  continued 
for  a  time,  and  finally,  on  October  30,  188"), 
the  defendant  sent  to  the  plaintiffs  the  fol- 
lowing telegram:    "Buy  ten  May,  ninety-eight 
or  better,  account  of  myself,  and  same  ac- 
count of  J.  E.  Shoenberg."    It  is  undisputed 
that  this  telegram  was  an  order  for  the  plain- 
tiffs,  as  agents  of  defendant,  to  buy  for  h'm 
on  the  Duluth  Board  of  Trade  10,000  bush- 
els of  wheat  to  be  delivered  in  May,  18S(),  at 
not  exceeding  98  cents  a  bushel.    Thereafter 
defendant  continued  to  send  similar  orders  to 
the  plaintiffs  until  the  following  June,  when 
the  plaintiffs  closed  him  out,  he  having  failed 
to  keep  good  his  margins.    From  time  to  time 
the  various  purchases  made  by  plaintiffs  for 
defendant    were    closed    out    on    his    orders. 
They  were  invariably  closed  out  by  the  plain- 
tiffs selling,  under  his  directions,  for  futiu-e 


delivery,  the  same  amount  of  wheat  he  had 
purchast'd.    The  first  transactions  resulted  in 
a  small  profit  to  defendant,  but,  after  pur- 
chasing 50,000  bushels  of  wheat  for  May  de- 
livery, the  price  fell  rapidly,  and  when  this 
purchase  was  closed  out  the  following  Ju.ie 
the  loss  resulting  from   the  transaction  over 
and  above  moneys  received  by  plaintiffs  from 
defendant    for     margins     was    over    $7,000. 
Plaintiffs  claim  that  they  were  compelled  to 
pay    out    on    behalf    of    defendant    in    thes3 
ti'ansactions  all  the  monejrs  for  which  they 
sue  except  tlieir  commissions,  and  they  also 
seek  to  recover  such  commissions  in  addition 
to   their  alleged    advances.    The   trial   court 
found  that  all  the  ti-ansactions  stated  in  the 
complaint  as  pm'cha.ses  and  sales  of  wheat 
(except  the  sales  of  actual  wheat  shipped  to 
plaintiffs  by  defendant  for  sale)  were  wager- 
ing transactions,  in  which  no  wheat  was  to 
be  delivered  or  received  by  the  parties  there- 
to,   and    that    the    defendant    employed    the 
plaintiffs    to   make    purchases    and    sales   of 
wheat  for  future  delivery  in  the  city  of  Du- 
luth,  Minn.,  with  the  mutual  uiulerstanding 
and  agi'eement  that  no  wheat  was  to  be  de- 
livered or  received  by  either  party,  and  that 
such   ti'ansactions  were  to  be  mere  wagers 
upon  the  rise  and   fall  of  the  nuirket  price 
at  Duluth;   that  all  such  purchases  and  sales 
were  made  pm-suant  to  such  mutual  under- 
standing;   that  all  of  such  transactions  were 
to  be  settled  at  a  futiu'e  time  by  the  payment 
of  differences,  viz.  the  difference  between  the 
contract  or  pm-chase  price  and  the  market 
price  on  the  day  of  settlement,  and  that  nei- 
ther party   to  the  transaction  should  be  re- 
quired to  deliver  or  receive  any  wheat;    that 
all  of  siich  transactions  involved  simply  gains 
or  losses  dependent  upon  the  futm'e  rise  or 
fall  of  the  market  price,  and  that  no  wheat 
was    demanded,   tendered,    delivered,    or   re- 
ceived in  any  of  the  transactions.    In  the  first 
place,  we  hold  that  the  rights  of  the  parties 
to  this  action  are  to  be  governed  by  the  laws 
of  iMinnesota.    The  agents  resided  t'.iere,  and 
the  purchases  and  sales  were  all  made  there, 
and    the    defendant  employed    the  plaintiffs 
as  his  agents  for  the  express  purpose  of  hav- 
ing svii'h  sales  and  purchases  made  there.    No 
proof  as  to  the  laws  of  Minnesota,  so  far  as 
this  question  is  concerned,  was  made.      Nor 
is  there  any  finding  on  this  point.    We  must, 
therefore,  presume  that  the  common  law  pre- 
vails there  with  respect  to  the  questions  of 
law  wJiich  this  case  presents.    We  recognize 
t..e  leg.  1  riglit  of  every  one  to  speculate  in 
every  commodity  which  he  does  not  own.  and 
for  which,  as  a  commodity,  he  has  no  use.  He 
may  enter  into  a  contract  to  buy  or  sell  any- 
thing of  value  for  the  sole  purpose  of  speculat- 
ing,—with  no  other  object  in  view  than  that  of 
making  profit  out  of  the  transaction;    but  he 
must  in  j;ood  faith  bind  himself  to  deliver  or 
receive   the   thing  sold  or  pm-chased.    It   is 
true  that  the  undisclosed  purpose  of  one  of 
the  parties  to  a   contract  not  to  deliver  or 
receive   the  article  conti-acted  for   will   not 


ILLEGAL  SALES. 


G27 


affoot    the   other    party,   who,    relying   on   a 
contract  calling  for  delivery,  intends  in  good 
faith  that  the  contract  shall  be  carried  out  in 
iill  of  its  particulars.    But  when  neither  party 
intends  that  the  property  shall  be  di'livered. 
where  they  both  intend  that  the  difference 
between  the  piu-chase  price  and  the  market  | 
ralue  at  the  time  specified  shall  be  paid  to  } 
the  one  who  wins,  then  the  transaction  is  a   , 
mere  wager,  and  is  void  at  common  law  in   ' 
this    country.       See   cases   cited    in    note   to  j 
Crawford  v.  Spencer.  1  Am.  St.  Rep.  at  page  I 
7.j9.  4  S.  W.  713.  and  92  Mo.  49S.     We  must, 
therefore,  presume  that  such  a  contract  would 
be  void  in  Minnesota. 

This  action,  however,  is  not  upon  the  sev- 
eral contracts  of  purchase  and  sale.  It  is 
brought  to  recover  the  advances  and  com- 
missions of  the  agents  who  negotiated  them. 
But  the  rule  which  prevents  recovery  upon  a  , 
mere  wagering  contract  applies  with  equal  ' 
force  to  the  agent  who  brings  the  parties  to- 
gether with  knowledge  that  their  purpose  is 
not  to  enter  into  a  legitimate  agreement,  but 
to  gamble  over  the  ever-shifting  price  of  the 
commodity  to  which  their  dealings  relate.  In 
this  case  it  is  expressly  found  that  the  plain- 
tilTs  knew  that  the  purpose  of  the  defendant 
was  to  gamble,  and  that  he  employed  them 
in  furtherance  of  that  purpose,  and  that  all 
the  transactions  in  which  the  plaintiffs  acted 
as  agents  for  defendant  were  mere  wagers  on 
the  price  of  wheat.  That  the  agent  cannot, 
under  such  circumstances,  recover  his  com- 
missions, or  the  advances  made  by  him  on  be- 
half of  his  principal,  is  well  settled.  Having 
knowingly  participated  in  an  illegal  transac- 
tion, the  law  will  leave  him  without  remedy 
In  case  of  loss.     Crawford  v.  Spencer,  92  Mo. 

498.  4  S.  W.  713;    Irwin  v.  Williar.  110  U.  S. 

499,  4  Sup.   Ct.  IGO;    Phelps  v.   Holderness, 
(Ark.)  19  S.  W.  921;   Embrey  v.  Jemison,  131 
U.  S.  336-34.5.  9  Sup.  Ct.  770.      The  findings 
are  broad  enough  to  embrace  the  fact  that 
the   persons  with   whom    plaintiffs   dealt   in 
making  purchases  and   sales   for  defendant 
had  no  thought  of  making  or  calling  for  de- 
livery of  the  wheat,  and  we  feel  clear  that  the 
evidence  fully  sustains  such  a  finding.    But 
we  are  not  compelled  to  rest  our  decision  on 
this  branch  of  the  ca.se  upon  this  finding  and 
the  sufficiency  of  the  evidence  to  sustain  it 
The   intention   of  the   other  party   to    these 
transactions  is  immaterial.     It  is  sufficient  if 
the  defendant's  purpose  was  to  gamble,  and 
the  plaintiffs  knew  of  it  when  they  went  upon 
the  board  of  trade  to  make  such  purchases  or 
sales  for  the  defendant.     Being  employed  by 
the  defendant  to   secure  for   him   upon  the 
board  of  trade  mere  wagers  upon  the  price  of 
wheat,  they  would  have  no  authority  to  enter 
into  legal  contracts  on  his  behalf;    and,  if 
they  should  do  so,  and  sustain  losses,  they 
could  not  recover  such  losses  from  him,  be- 
cause   their    acts    resulting    in    such    losses 
woxdd    be   unauthorized.     Moreover,    having 
been  instructed,  to  make  mere  wagers  on  be- 
half of  defendant,  the  law  will  presume,  as 


against  the  agents 'in  a  case  in  which  the 
other  party  to  the  transaction  is  not  interest- 
ed, that  they  obeyed  such  instructions,  and 
that,  therefore,  they  did  not  enter  into  legal 
contracts  with  others,  binding  the  parties  to 
deliver  and  receive  the  wheat  agreed  to  be 
bought.    There  is  no  direct  evidence  as  to  the 
intention  of  the  other  parties  to  the  several 
purchases    and    sales.     The   transactions   on 
both    sides   appear   to    have    been    precisely 
alike,  and  it  is  a  fair  inference  that  the  trans- 
actions which  defendant  intended  should  be 
mere    wagers,     which    the     plaintiffs,     with 
knowledge  of  such  intention,  entered  into  on 
behalf  of  defendant,  and  which  were  in  the 
form  in  which  gambling  in  all  kinds  of  com- 
modities is  carried  on.  were  in  fact  intended 
by  all  parties  thereto — principals  and  agents 
on   both  sides— to  be  mere   bets  v.'ith  refer- 
ence to  the  future  price  of  wheat.     That  the 
intention  of  the  other  pai'ty  to  the  contract 
is  immaterial  when  the  agent  who  is  seeking 
to  recover  commissions  and  advances  knows 
of  the  purpose  of  his   principal   to   gamble, 
and  loses  the  money  for  which  he  seeks  judg- 
ment in  furthering  that  purpose,  is  a  well- 
established  doctrine.     Phelps  v.  Holderness, 
(Ark.)  19  S.  W.  921;    McCormick  v.  Nichols, 

19  111.  App.  334.  337;  Beveridge  v.  Hewitt,  8 
111.  App.  4G7.  482,  483:  Miles  v.  Andrews. 
40  111.  App.  155,  163,  164;   Coffman  v.  Young. 

20  111.  App.  82.  In  Embrey  v.  Jemison.  131 
U.  S.  336,  9  Sup.  Ct.  776.  the  defendant  in  an 
action  brought  upon  notes  given  in  settle- 
ment of  a  claim  of  his  agents  for  losses 
growing  out  of  the  purchase  and  sale  of  cot- 
ton for  defendant  set  up  as  a  defense  that 
neither  he  nor  his  agents  intended  that  ac- 
tual cotton  should  ever  be  delivered.  There 
was  no  averment  that  the  other  party  to  the 
transaction  entertained  the  same  purpose  in 
making  the  contracts  out  of  which  the  loss- 
es grew.  And  yet  the  coiu-t  held  that  the 
answer  stated  a  good   defense.     See   pages 

[   338.  349.  131  U.  S..  and  page  776,  9  Sup.  Ct. 
}       We  come  now  to  the  question  of  the  evi- 
I    dence  to  support  the  findings  that  the  plain- 
!   tiff's  knew  that  the  purpose  of  the  defendant 
was  to  gamble,  and  that  the  losses  for  which 
they  sue  were  suffered  by  them  in  furthering 
\   such  illegal  purpose.     At  the  outset,  we  con- 
clude that  plaintiffs  are  right  in  the  conten- 
tion that  the  burden  is  on  the  defendant  to 
establish  by  competent  evidence  the  illegali- 
ty of  these  transactions,  and   the  participa- 
tion of  the  plaintiffs  in  the  unlawful  purpose 
of  the  defendant.     We  might  also  safely  as- 
sume that  the  sales  and  purchases  made  by 
plaintiffs   on    behalf    of    defendant    were   in 
form  legal  contracts,  calling  for  the  delivery 
of  wheat  specified  therein.     It  is  significant, 
however,  that,  while  the  witnesses  on  behalf 
of  plaintiffs  testify  to  actual  sales,  they  do 
not  pretend  to  state  the  terms  of  the  con- 
tracts, nor  was  any  written  contract  of  sale 
introduced  in  evidence.     Without  at  least  a 
written    memorandum    of   these    sales,    they 
would  not  have  been  valid,  and  it  is  diffi- 


828 


ILLEGAL  SALES. 


cult  to  uiulerst. 111(1  why  these  contracts  were 
not  rL'diiced  to  writhifj-  if  they  were  intended 
to  embody  the  terms  of  a  bona  fide  sale.  It 
was  the  duty  of  the  plaintiffs,  as  agents  for 
defendant,  to  secure  for  him  a  contract  he 
could  enforce^  if  they  were  making  bona  fide 
sales  and  purchases  for  him.  The  silence  of 
the  record  in  this  respect  is  strong  evidence 
that  these  alleged  agreements  were  not  in 
writing.  Nay,  there  is  positive  evidence  that 
they  were  not  r(>duced  to  writing.  One  of 
the  plaintiffs  testified  that  formal  contracts 
were  not  drawn  up,  but  that  there  was  al- 
ways a  full  understanding  as  to  the  nature 
of  the  transactions.  But,  however  perfect 
the  likeness  of  a  gambling  transaction  to  the 
form  and  features  of  a  legitimate  sale,  the 
legality  of  the  dealings  between  the  parties 
nuist  rest  ultimately  upon  their  honest  in- 
tention. Illegality  is  seldom  guilty  of  the 
consummate  folly  of  flaunting  its  defiance 
of  law  in  the  face  of  public  sentiment— of 
furnishing  itself  the  evidence  of  its  violation 
of  law.  To  escape  the  penalties  of  breaking 
the  law,  it  will  always  put  on  the  "suits  and 
trappings"  of  honest  transactions.  Mere 
wagering  contracts  invariably  wear  the  garb 
of  bona  fide  sales.  This  is  common  knowl- 
edge. Myriads  of  gambling  operations  are 
daily  arranged  by  two  interested  brokers, 
who  fatten  on  the  folly  of  their  dupes,  in  the 
decent  and  decorous  habiliments  of  lawful 
business  transactions.  The  naivete  of  a  tri- 
bunal which  in  such  cases  should  unqucstion- 
ingly  take  the  semblance  for  the  substance 
would,  indeed,  be  pitiable,  if  it  did  not  ex- 
cite derision  and  contempt.  The  courts  have 
always  sought  to  pierce  the  disguise,  and  as- 
certain the  real  intention  of  the  parties. 
AVhitesides  v.  Hunt,  97  Ind.  191;  Melchert 
V.  Telegraph  Co.,  11  Fed.  193;  Edwards  v. 
Hoeffinghoff,  38  Fed.  039;  Embrey  v.  .Temi- 
son.  131  U.  8.  331).  344,  9  Sup.  Ct.  770;  Irwic 
v.  Williar,  110  U.  S.  499.  4  Sup.  Ct.  109;  Mohr 
V.  Miesen  (Minn.)  49  N.  W.  802.  Said  the 
court  in  Melchert  v.  Telegraph  Co..  11  Fed. 
193:  'Tn  seeking  to  ascertain  the  intentions 
of  parties  to  such  tran.sactions  as  the  one 
under  consideration,  it  is  evident  that  it  will 
not  do  to  place  any  great  stress  upon  the 
mere  terms  of  the  contract,  or  upon  their 
own  declarations,  whether  under  oath  or  not. 
Parties  under  such  contracts  will  always 
seek  to  give  them  the  form  and  semblance  of 
legality,  and  all  our  experience  admonishes 
us  to  receive  with  extreme  caution,  if  not  ab- 
solute distrust,  what  parties  charged  with 
transactions  ap])areutly  illegal  say  respecting 
the  innoceucy  of  their  own  intentions."  In 
Edwards  v.  Hoefliiighoff,  38  Feci.  039.  Judge 
Sage  says:  "No  matter  what  the  form  of  the 
contract,  no  matter  how  many  colorings  of 
reality  and  genuine  dealing  are  thrown  about 
the  transaction,  if.  piercing  all  these  disguis- 
es, the  court  or  jury  see  that  all  these  forms 
nre  mere  shams,  and  that  there  was  in  fact 
ao  actual  dealing  in  the  article  itself,  but  that 
'ornis  were  adopted  as  a  mere  semblance  to 


deceive  and  evade  the  law.  it  is  the  duty  of 
the  court  and  jury  to  tear  away  the  disguise, 
and  treat  the  transaction  as  it  is."  In  Em- 
brey V.  Jemison.  131  U.  S.  344,  9  Sup.  Ct.  770, 
the  court  said  of  the  transaction  there  before 
it:  "If  this  be  not  a  wagering  contract  under 
the  gtiise  of  a  contract  of  sale,  it  woidd  be 
difficult  to  imagine  one  that  would  be  of  that 
charactei-.  The  mere  form  of  the  transac- 
tion is  of  little  consequence.  If  it  were,  the 
statute  against  wagers  could  easily  be  evad- 
ed." What,  then,  were  the  intentions  of  de- 
fendant? Was  his  purpose  merely  to  gam- 
ble? Did  plaintiffs  have  knowledge  of  such 
purpose?  Did  they  aid  him  in  carrying  it 
out?  Were  these  losses  incurred  by  thrm 
in  so  doing?  The  evidence  fully  sustains  the 
finding  of  the  court  with  respect  to  the  inten- 
tion of  the  defendant.  He  testified  tliat  his 
sole  object  was  to  make  wagers  on  the  price 
of  wheat.  The  character  of  the  transactions, 
and  the  evidence  of  all  the  parties,  fully  cor- 
roborate his  statement. 

The  only  remaining  question  is  whether 
the  plaintiffs  were  aware  of  defendant's  pur- 
pose when  they  went  upon  the  board  of  trade 
to  make  for  him  the  several  purchases  and 
sales  out  of  which  these  losses  grew.  If 
they  did,  it  is  an  inevitable  inference  that 
they  participated  in  his  gambling  project, 
and  actually  aided  him  therein.  We  are 
clear  that  the  circumstances  surrounding 
these  transactions  fully  sustain  the  finding 
of  such  knowledge  and  participation.  The 
order  to  purchase  wheat  came  to  plaintiffs  in 
the  form  in  which  mere  orders  to  gamble 
in  the  price  of  wheat  are  sent  by  speculators 
to  brokers.  It  is  a  well-known  fact  that  a 
large  percentage  of  such  transactions  are 
only  wager'ng  operations.  Xo  one  knew  this 
better  than  the  plaintiffs  when  they  received 
the  defendant's  different  orders  to  buy  and 
sell.  At  no  time  during  all  these  transactions 
was  there  a  suggestion  from  either  plain- 
tiffs or  defendant  that  a  bushel  of  this  wheat 
w'as  to  be  delivered  to  or  by  the  defendant. 
He  was  never  informed  of  the  names  of  the 
dift'erent  brokers  of  whom  these  purchases 
or  to  whom  these  sales  were  made.  He  never 
knew  who  were  the  principals  back  of  such 
brokers  with  whom  he  had  entered  into  con- 
tracts calling  for  the  delivery,  on  plaintiffs' 
theory,  of  thousands  of  bushels  of  wheat. 
His  indifference  to  this  matter  of  delivery 
all  through  these  transactions  w^as  certainly 
suggestive  to  plaintiff's,  who  were  familiar 
with  such  indifference,  and  the  reasons  for 
it.  through  having  witnessed  it  in  a  multi- 
tude of  similar  transactions.  From  the  very 
br-ginning  the  defendant  pursued  the  course 
of  closing  out  these  purchases  long  before 
tlie  day  of  delivery  had  arrived;  in  some 
oases  ordering  sold,,  within  a  few  days  after 
the  purchase,  all  or  a  portion  of  the  wheat 
purchased  for  ^lay  delivery.  What  did  this 
indicate  to  the  mind  of  the  plaintiffs,  if  it 
did  not  tend  to  show  them  'that  defendant 
was  merely   gambling   in  options?     The  de- 


ILLEGAL  SALES. 


129 


f.>!ul;int   was    a    lawj'tT,   as    plaintiffs   well   i 
know.     Why    was   he    bnyiuj?    thousands   of   | 
bushels   of   wheat    for   future   delivery,    and 
then  closin;,'  out  the  ti-ansaetion   in  a   short    j 
time?     It  is   also  sin^'ular  that   the  defend-   j 
ant   should   take  no   pains   to   inquire   a ;  to   j 
the  responsibility  of  tlie  persons  of  whom  the 
plaintiffs  had  pm-chast-d  wheat  for  him  for 
May   delivex-y,    if  the  transactions  were   or-   '< 
diuary    business    transactions,    and   not    the   j 
usual    wagering   deals    ui>on     the    board    of   j 
trade.     The  pm-ehaser  iu  an  honest  business 
sale  naturally  wishes  to  know  something  of 
the  pecuniary  responsibility  and  of  the  char- 
acter of  the  man  who  has  agreed  to  deliver 
property  to  him  at  a  certain  time  for  a  speci- 
tied  price.     If  the  vendor   will  not  perform    : 
his  contract,  and  cannot  be  made  to  pay  dam- 
ages for  breach  of  it,  the  contract  is  of  no 
value    to     the     purchaser.     How    could     the 
plaintiffs   expect   that   the   defendant   would 
regard  a  bona  fide  purchase  by  him  closed 
out,   and   himself  released  from   all   further 
liability  on  the  conti-act  bj'  ordering  a  new 
contract  to  be  made  with  another  person, — 
a   contract   of  sale, — thus  increasing,    rather 
than  extinguishing,   his  liability,  if  the  two 
transactions  were  bona  fide  sales?     The  nat- 
ural mode  of  wiping  out  an  obligation  is  to 
reach  the  pai*ty  who  holds  it,  and  agree  with 
him  as  to  the  terms  on  which  he  will  release 
the  other  partj'  who  desh-es  to  be  discharged. 
Yet  the  plaintiffs  knew  that  the  defendant 
was    willing    to    pursue    a    widely    different 
com'se,  and  close  out  his  purchase  at  a  profit, 
by    obligating    himself    to    sell    moi*e    wheat 
to  another  without  seeming  release  from  the 
contract  of    purchase    which    he    desired    to 
wipe  out     It  is  only  on  the  theory  that  these 
transactions  were  understood  by  the  defend- 
ant to  be  mere  wagers  on  the  price  of  wheat 
that  they  can  be  accoimted  for  when  we  con- 
sider tlie  object  of  the  defendant  in   enter- 
ing into  them, — i.  e.  to  close  out  his  pretend- 
ed  purchases  at  a  profit.     Where   the   piu*- 
chase  and   the   sale  are   legitimate   transac- 
tions,   one   cannot    count    in    advance    on    a 
profit,  although  he  has  contracted  to   settle 
at  a  higher  price  than  he  has  agreed  to  pay 
for  the  same  commodity.     The  one  who  has 
agreed  to  pay  him  the  higher  price  may  re- 
fuse  to  perform  the  contract,   and  may   be 
without  financial  responsibility.     Indeed,  the 
dealer   may,    in    such   case,    find,    when    the 
time  for  delivery  arrives,  that  he  has  actual- 
ly lost,  as  the  market  price  of  the  commodity 
.-.y   then   be  lower  than  the  price  he  has 
;;gi'eed  to  pay  for  it.  and   the   irresponsible 
purchaser  iu  the  other  contract  maj-  refuse  to 
carry  out  his  agi'eenieut.    Defendant's  belief, 
which  his  communications  and  conduct  made 
manifest  to  the   plaintiffs,   that  both  ti'ans- 
actions.  the  purchase  and  the  sale,  were  at 
an  end,  and  that  he  had  won  or  lost,  as  the 
case  might  be.  must  have  furnished  to  the 
plaintiff's  verj*  cogent  evidence  that  defend- 
ant did  not  regard  these  dealings  as  legiti- 
mate purcha.ses  and   sales,  but  only  in  the 


light  of  wagers  on  the  market  price  of  wheat. 
Plaintiffs  knew   that   defendant  had   no  use 
for    the    wheat    he    ordered    purchased,    and 
they  took  no  pains  to  ascertain  whetlu'r  he 
had    sulli<'ient    financial    ability    to    pay    for 
the  large  purchases  he   made  from   time  to 
time  on  the  theory  tliat  he  intended  to  re- 
ceive   and    pay    for    the    wheat.     Defendant 
never  furnished  any  money  to  make  the  dif- 
ferent purchases  with,  nor  was  he  ever  etilled 
on   by   the   plaintiffs   to   furnish    them   with 
money    for    that    purpose.     He    merely    sent 
them  funds  from  time  to  time  to  keep  g  )od 
his  margins  as  he  bought  and  then  sold.     It 
is  true   that   plaintiffs   insist  that   the   sales 
were  genuine,  and  that  they  did  not  know  of 
defendant's  purpose  to  gamble.     But  courts 
are  not  bound  by  the  testimony  of  interested 
parties,  but  may  look  to  the  surrounding  cir- 
cumstances, to  ascertain  the  true  character 
of  tlie  transactions.     Some  of  the  correspond- 
ence   between    the    pai'ties    fm-nishes    strong^ 
evidence    that   plaintiffs   knew   that   defend- 
ant's sole  purpose  was  to  gamble.     On  Eeb- 
ruary  5,   1S8G,  defendant  wrote  to  plaintiffs 
a  letter,  in  which  the  following  sentence  ap- 
pears:   "'I  now  see  that  you  have  my  actual 
wheat   account    mixed   with    my   option    ac- 
count."    In  this  letter  he  distinctly  notifies 
plaintiffs  that  his  option  account  is  not  an 
account  involving  the  purchase  and  sale  of 
"actual   wheat."     The  two    expressions    are 
used  to  distinguish  the  two  classes  of  trans- 
actions;    one    relates    to    actual    wheat,    the 
other  not.     He  speaks  of  the  account  of  the 
fictitious  wheat  ti'ansactions  as  the  "option 
account."    Fictitious  wheat  transactions  they 
must  be  if  they  do  not  relate  to  actual  wheat. 
On  the  loth  day  of  December,  ISS-j,  defend- 
ant wrote  plaintiffs  as  follows:    "When  you 
can  buy  20  May  at  9.3  cents,  take  it.     I  have 
."i.WO    wheat    in    granary.     Do    you    handle 
wheat  in  Minneapolis?     By  the  way,  I  want 
you  to  handle  options  for  me  at  one-eighth." 
On    the    4th    of    December,    18S.J.    plaintiffs 
wrote  to  defendant  a  letter,  in  which  they 
said:    "Om-  market  opened  at  98^^  for  May, 

;  developed  strength  throughout  the  day.  and 
closed  at  one  dollar  bid.  We  are  very  glad 
you  had  the  pluck  to  hold  on.  and  be- 
lieve that  wheat  is  a  purchase  on  all  .good 
breaks.     Still,   if  you   get  a  fair   profit,    we 

;  would  advise  you  to  close  it  out,  taking 
clmnces  of  getting  it  back  at  cheaper  figures. 
\Ye  have  had  a  very  good  advance,  and  any 
further  bulge  wiU  doubtless  be  followed  by 
some  reaction."  In  this  letter  plaintiffs 
tlieuiselves  advise  this  man,  who.  according 
to  their  theory,  had  bought  actual  whi'at,  to 
close  it  out,  and  buy  it  back  cheaper.  In 
other  words,  they  plainly  tell  him  that  the 
iK'livery  of  tlie  wheat  is  not  what  any  one 
is  thinliing  of.  They  advise  him  to  close 
up  the  old  bet  as  soon  as  he  can  secure  a 
fair  profit,  and  then  make  another  bet  when 
wheat  has  again  fallen  in  price. 

Om-  attention  has  been  called  to  one  of  the 
rules  of  the  Duluth  Board  of  Trade,  and  to 


330 


ILLEGAL  SALES. 


tlio  tostiinoiiy  that  it  was  iu  force  when 
these  trausactious  were  had,  and  that  they 
were  entered  into  by  phiintiffs  with  refer- 
ence to  such  rule.  It  dechires  as  follows: 
"In  all  cases  of  sale  of  produce,  the  party  or 
parties  selliuj;  shall  deliver  the  property  sold 
at  the  time  specitied,  unless  the  purchaser 
shall  consent  to  accept  or  pay  the  difference 
in  cash,  when  so  requested  to  do  by  the  seller. 
In  all  cases,  however,  the  buyer  shall  have 
the  right  to  demand  the  property,  if  he  so 
elects."  This  rule  confirms  our  views  that 
these  transactions  were  known  by  plaintiffs 
to  be  mere  wagerintr  deals.  In  this  very  rule 
the  pm-chaser  is  given  the  option  to  accept 
or  pay  the  diiferenee  in  price  when  the  seller 
so  requests  him  to  do.  In  other  words,  the 
rule  provides  that  the  parties  may  agree  to 
do  what  every  layman  knows  they  can  agi'ee 
to  do  without  any  such  rule.  Why  mention 
this  right  to  agree  to  settle  by  paying  differ- 
ences when  it  is  a  right  which  exists  inde- 
pendently of  any  rule?  The  reason  is  ob- 
vious, when  the  almost  imiversal  practice  is 
considered.  When  brokers,  by  their  rules, 
inform  their  speculating  customers  that  no 
delivery  is  necessary  if  the  parties  agi-ee  to 
dispense  with  it,  and  this  is  followed  by  the 
almost  uniform  practice  of  settling  by  paying 
differences,  we  are  constrained  to  believe 
that  no  delivery  was  intendcxl  from  the  very 
outset  of  any  of  these  transactions,  and  that 
the  brokers  were  well  awai-e  of  it.  With  the 
obvious  pm-pose  of  covering  up  the  gambling 
character  of  these  operations,  they  establish 
a  rule  that  there  shall  be  a  delivery,  unless 
both  parties  agree  to  dispense  with  it;  know- 
ing that  both  parties  will  always  so  agree. 
It  is  significant,  too,  that  this  rule  applies  on- 
ly to  actual  sales.  This  still  leaves  the  ques- 
tion open  whether  the  parties  intended  an 
actual  sale  or  were  merely  wagering  on  the 
price  of  the  commodity  ostensibly  bought 
and  sold.  This  rule  does  not  apply  at  all  if 
the  deal  is  a  mere  wager.  It  does  not  dec-lare 
that  every  transaction  on  the  board  of  trade 
shall  be  a  bona  fide  sale,  but  merely  provides 
that,  if  it  is  a  sale,  the  parties  must  deliver, 
unless  they  agr?e  to  settle  by  paying  differ- 
ences. Moreover,  it  does  not  appear  when 
the  consent  may  be  given  to  settle  in  this 
way,— whether  after  the  transaction  is  con- 
summated, or  at  the  time  the  deal  is  made. 
If  at  the  time  the  deal  is  made,  then  this  un- 
derstanding of  itself  renders  the  operation  a 
mere  wager,  for  it  is  an  undei'standing  from 
the  very  beginning  that  there  shall  be  no  de- 
livery. But  the  real  purpose  of  the  parties 
to  gamble,  when  it  is  once  found  to  exist, 
cannot  successfully  escape  the  condemnation 
of  the  law,  whether  the  false  appearance  of 
an  honest  sale  is  put  on  by  riiles  of  boards  of 
trade  or  by  the  devices  of  executing  legal  con- 
tracts in  form.  It  has  been  frequently  held 
that  circumstances  similar  to  those  which 
surround  these  ti-ansactions  amply  sustain  a 
finding  that  the  dealings  between  the  parties 
were  mere  wagers,  when  the  circumstances 


were  no  more  convincing  than  in  this  case. 
Mohr  V.  Miesen  (Minn.)  49  N.  W.  8G2;  Phelps 
v.  Holderness  (Ark.)  19  S.  W.  921;  Cobb  v. 
Prell,  15  Fed.  774;  Crawford  v.  Spencer,  92 
Mo.  498,  4  S.  W.  713;  Miles  v.  Andrews,  40 
111.  App.  155;  Beveridge  v.  Hewitt,  8  111. 
App.  482;  Colderwood  v.  McCrea,  11  111.  App. 
540;  Watte  v.  Wickersham  (Neb.)  43  N.  W. 
259;  Sprague  v.  Warren  (Neb.)  41  N.  W. 
1113.  We  would  expect  the  plaintiffs  to  give 
to  these  gambling  ti'ansactions  the  appear- 
ance of  honest  sales,  and  to  insist  in  their 
testimony  that  they  were  what  they  ap- 
peared to  be.  But,  although  the  hands  may 
seem  to  be  tlie  hands  of  Esau,  the  voice  is 
unmistakably  the  voice  of  Jacob. 

One  of  the  errors  assigned  relates  to  the 
admission  of  the  testimony  of  the  defendant 
with  reference  to  statements  made  to  him  by 
one  Nichols,  the  agent  of  the  plaintiff's, 
touching  the  character  of  the  business  he 
urged  defendant  to  carry  on  with  plaintiff's. 
In  substance,  the  defendant  testified  that  this 
agent  informed  him  that  these  transactions 
which  the  agent  induced  him  to  enter  into 
with  plaintiffs  would  be  mere  wagers  on  the 
price  of  wheat;  that  in  them  no  wheat  would 
be  delivered  by  either  party  to  the  different 
deals.  Plaintiffs  here  contend  that  the  re- 
ception of  this  evidence  was  en'or,  because 
the  agent,  Nichols,  had  no  authority  to  rep- 
resent them,  except  in  the  matter  of  securing 
shipments  of  actual  wheat,  to  be  sold  by 
plaintiffs  for  the  shipi>ers,  as  their  agents  in 
Duluth.  There  is  no  attempt  in  this  case  to 
enforce  against  plaintiffs  any  liability  be- 
cause of  any  contract  made  by  this  agent  on 
their  behalf;  but  it  is  claimed  that  the  case 
shows  that  Nichols  had  no  authority  to  act 
for  them  except  in  legitimate  transactions, 
and  that,  therefore,  any  knowledge  he  may 
have  acquired  that  the  defendant  intended 
to  gamble  would  not  affect  them;  and  hence 
it  is  contended  that  it  was  prejudicial  error 
receive  this  evidence,  as  the  court  may 
have  considered  it  as  evidence  of  knowledge 
on  the  part  of  plaintiffs  of  defendant's  ille- 
gal purpose.  But  this  evidence  was  admis- 
sible for  the  purpose  of  strengthening  de- 
fendant's testimony  that  his  sole  purpose 
was  to  gamble;  to  show  that  he  had  ground 
for  believing  that  he  was  only  gambling,  and 
that  he  so  understood  the  subsequent  trans- 
actions. Its  value  for  this  purpose  would 
not  depend  upon  the  authority  of  the  agent, 
but  upon  the  mere  fact  that  such  agent  had 
put  into  defendant's  mind  the  thought  of  en- 
gaging in  such  gambling  transactions.  As  it 
was  admissible  for  this  purpose,  it  was  not 
error  to  receive  it.  We  cannot  assume  that 
the  court  considered  it  as  proving  another 
fact  which  it  had  no  legal  tendency  to  prove. 
On  the  contrary,  it  is  a  fair  presumption  that 
the  court,  after  having  lawfully  received  the 
evidence  to  establish  one  fact,  regarded  it  as 
incompetent  to  prove  another  fact,  which 
could  not  legally  be  established  in  tnat  way. 
Especially     must    this    be    the    presumption 


ILLEGAL  SALES. 


331 


Avlu'ii  it  appears,  as  is  done  in  this  case,  that 
tlie  latter  fact  is  almost  conclusively  estab- 
lislu'tl  by  other  evidence. 

We  come  now  to  the  second  branch  of  the 
case.  Defendant  set  forth  in  his  answer  as 
a  coimterclaim  that  he  had  paid  to  plaintiffs 
certain  sums  of  monej^  as  marjjins  in  these 
ijamblinj,'  transactions,  and  asked  that  judg- 
ment for  this  money  be  rendered  against  the 
plaintiffs  in  his  favor.  It  is  undisputed  that 
defendant  did  in  fact  pay  to  the  plaintiffs  as 
margins  the  sum  of  .$4.2.jU.US.  The  right  to 
recover  back  this  money,  it  is  conceded  by 
defendant's  counsel,  rests  upon  the  Minne- 
sota statute.  It  seems  to  be  agreed  between 
counsel  for  the  plaintiffs  and  defendant  that 
there  is  no  common-law  liability  to  refund 
such  money,  and  that  the  rights  of  the  par- 
ties are  governed  by  the  laws  of  Minnesota, 
where  the  ti'ansactions  were  can-ied  on,  and 
not  by  the  laws  of  this  state.  The  statute  of 
Minnesota  relied  on  by  defendant  provides 
that:  "Whoever  by  playing  at  cards,  dice  or 
other  game,  or  by  betting  on  the  hands  or 
sides  of  such  as  are  gambling,  loses  to  any 
person  so  playing  or  betting  any  sums  of 
money  or  any  goods  whatever  and  pays  or 
delivers  the  same  or  any  part  thereof  to  the 
winner,  the  person  so  losing,  and  paying  and 
delivering  the  same,  may  sue  for  and  recover 
such  money  by  a  civil  action  before  any 
com't  having  competent  jurisdiction."  Gen. 
vSt.  c.  99,  §  13.  Without  attempting,  in  this 
opinion,  an  analysis  of  the  statute,  we  are  en- 
tirely free  from  doubt  In  our  view  that  it 
does  not  relate  to  moneys  lost  in  dealing  in 
options.  Under  similar  statutes  the  courts 
bavo  uniformly  held  against  the  liability  of 


the  person  receiving  the  margins  to  refund 
them.  Sondheim  v.  Gilbert,  117  lud.  71,  18 
X.  E.  (>S7;  Shaw  v.  Clark,  49  Mich.  384,  13 
N.  W.  78G;  Bank  v.  Harrison,  10  Fed.  243. 
The  cases  cited  by  defendant's  coimsel  arose 
under  very  different  statutes,  and  for  that 
reason  they  are  not  in  point.  We  therefore 
hold  that  the  statute  gives  defendant  no 
right  to  recover  the  moneys  paid  to  plaintiffs 
for  margins.  That  there  is  no  liability  inde- 
pendently of  statute  is  not  open  to  discus- 
sion. The  law  leaves  both  parties  where  i 
finds  them.  Higgins  v.  McCrea,  110  U.  S. 
U71,  G  Sup.  Ct.  557;  White  v.  Barber,  123  U. 
S.  392.  8  Sup.  Ct.  221;  Kahn  v.  Walton 
(Ohio  Sup.)  20  N.  E.  210. 

The  trial  court  errtxl.  however,  in  refusing 
costs  to  defendant.  Plaintiffs,  having  failed 
to  establish  their  cause  of  action,  were  not 
entitled  to  costs;  and  in  all  cases  in  which 
the  plaintiff  is  not  entitled  to  costs  the  de- 
fendant recovers  costs  as  a  matter  of  course. 
His  rights  do  not  depend  upon  his  sustaining 
a  counterclaim  which  he  may  have  inter- 
posed. It  depends  solely  upon  his  prevent- 
ing a  recovery  of  costs  by  the  plaintiff.  Had 
defendant  set  up  no  counterclaim,  there 
would  have  been  no  doubt  about  his  right  to 
costs.  He  is  in  no  woree  position  because 
he  did  interpose  a  counterclaim,  and  failed 
to  sustain  it.  Ury  v.  Wilde  (Super.  N.  Y.)  3 
N.  Y.  Supp.  791. 

On  plaintiffs'  appeal,  the  judgment,  so  far 
as  it  dismisses  the  action,  is  aftirmed.  On 
defendant's  appeal,  the  judgment  is  modified 
by  allowing  to  defendant  his  costs  in  the  dis- 
trict court.  As  so  modified,  the  judgment  is 
in  all  respects  atfii-med.    Ail  concur. 


332 


AVAKKAXTY. 


MORSE  ot  al.  v.  MOORE. 

(22  Atl.  362,  83  Me.  473.) 

Supreme  Judicial  Court  of  Maine.     May   20, 
1 SU1 . 

Exceptions  lioiu  supreme  judicial  court, 
Sasadahoe  count}'. 

This  was  an  action  of  assuniiisit  to  recover 
for  two  cargoes  of  ice  under  a  written  con- 
tract. Th(^  verdict  was  for  the  [)laintiffs.  for 
the  full  contract  price,  with  interest.  The 
defendant  contended  at  the  trial  that  the  ice 
shipped  was  not  such  as  Avas  called  for  by 
the  contract:  aud  that  its  quality  was  such, 
on  account  of  excessive  sap,  that  it  had  no 
market  value,  and  was  worthless  wiien  load- 
ed on  board  the  ves.sels  in  this  state,  or  was 
at  least  wortli  very  much  less  than  the  con- 
tract price.  Both  cargoes  were  discharged  in 
Marcli,  3888.  at  Richmond,  Va.,  and  placed 
by  the  defendant  in  his  ice-house.  He  denied 
that  the  ice  was  accepted.  Upon  the  ques- 
tion of  acceptance,  the  defendant  offered  the 
following  letters  and  telegram,  which  were 
received  by  the  plaintiffs.  The  telegram  and 
the  parts  of  the  letters  inclosed  in  braclcets 
were  admitted  by  the  court,  and  the  rest  of 
the  letters  were  excluded. 

"[Richmond,   Ya.,   March   13,   1888. 
•'Mr.  .Tno.  A.   Morse,   Bath,   Maine: 

"Dear  Sir:  The  'Hyde's'  cargo  is  worse  as 
it  goes  down.  The  sap  averages  five  inches 
on  each  cake.  Please  telegraph  me  what  to 
do  about  'Crockett'  cargo.  She  is  due.  and  if 
as  liad  as  'Hyde'  I  do  not  want  it.]  Do  not 
send  any  more  unless  you  can  send  ice  up  to 
contract.  Please  wire  me  on  receipt  of  this 
what  you  will  do.  It  is  not  only  a  loss  on 
cost  of  ice,  but  freight  also,  and  storing.  The 
top  tier's  as  white  as  snow  as  .soon  as  the  sim 
strikes  it. 

"Yours,  Warner   Moore." 

"Received  at  Bath,  Maine,  ]March  22iid. 
1888." 

"Dated  at  Richmond,  Ya.,  21." 

"To  J.  A.   Morse: 

"Crockett  arrived;  more  sap  than  'Hyde's.' 
What  shall  I  do  with  it?     Answer. 

"Warner   Moore." 
"[Riclunond,    Ya.,    March   21,    1888. 

"Mr.  J.  A.  Mor.se,  Bath: 

"Dear  Sir:  I  telegraphed  you,  'Croc-lcett  ar- 
rived. More  sap  than  Hyde's.  What  shall 
I  do  with  it?  Answer.'  I  wrote  you  several 
days  ago  about  the  ice  but  no  reply.]  I 
measured  .several  cakes,  and  they  have  from 
four  to  six  inches  of  sap.  Haley,  of  Gardi- 
ner, is  here,  and  T  am  soriy  to  say  he  has 
seen  it,  and  is  using  his  influence  against  my 
wagons.  It  is  awful.  Why  did  you  send 
me  such  stuff?  My  manager,  :Mr.  Gaubert, 
came  fi-ou'  Gardiner.  He  was  with  Hayues 
and  Dewitt  Co.  for  j-ears,  and  he  never  saw 
such  ice  shipped  before.  I  am  sorry  you  un- 
load this  bad  ice  on  me.  My  contract  calls 
for  prime  quality.  Answer  by  first  mail. 
Oblige,  Warner  Moore." 


The  defendant  was  called  as  a  witness  to 
prove  that  he  had  not  accepted  the  ice,  aud 
was  aslvcd  what  he  did  with  the  cargoes  after 
they  were  dischai-ged  at  Richmond,  and  after 
the  telegram  and  letter  dated  March  21st; 
but  upon  objection  the  court  excluded  the 
questions. 

Upon  this  point  the  following  instructions 
were  given  to  the  jury:  "Was  it  clear,  mer- 
chantable ice,  within  tlie  meaning  of  the  term 
as  used  among  merchants?  If  so,  then  per- 
haps that  may  end  any  fui'ther  consideration 
of  the  case;  because  it  was  delivered  on 
board  the  defendant's  vessel,  and  carried 
away  by  him,  and  you  may  be  satisfied,  from 
the  evidence  that  has  been  submitted  to  you, 
was  used  l)y  him  in  some  way. 

"If,  under  the  circumstances,  he  takes  the 
commodity,  and  carries  it  away  to  a  distant 
state,  and  unloads  it  from  the  vessels,  aud 
puts  it  into  his  own  ice-house,  and  commences 
to  deliver  that  as  his  own  property,  what 
would  you.  and  what  do  you,  infer  as  to  the 
question  of  acceptance  under  the  contract?" 

The  defendant  claimed  that  the  ice  in  con- 
troversy had  from  three  to  four  inches  of  sap 
or  snow  ice  upon  it  as  an  average,  and  that 
quite  a  portion  of  it  had  from  six  to  eight 
inches  of  sap  upon  it,  and  that  for  these  rea- 
sons it  was  not  merchantable,  and  was  value- 
less. This  was  denied  by  the  plaintiffs.  The 
defendant  contended,  also,  that  he  could  re- 
ceive the  ice.  and,  if  it  was  not  of  the  quali- 
ty required  by  the  contract,  that  in  this  action 
against  him  for  the  price  he  could  prove  the 
fact,  either  in  dimimUiou  of  damages,  or  in 
full  answer  to  the  action,  if  tlie  ice  was  of  no 
value.  Upon  this  branch  of  the  case  the  pre- 
siding ju^^tice  instructed  the  jury  as  follows: 

"He  cannot,  under  a  contract  like  this,  i-e- 
ceive  the  property-  called  for  by  the  coutract. 
aud  accept  it.  and  then  turn  round  and  say 
that  he  is  not  bound  to  pay  the  price  which 
tlie  contract  calls  for.     *     *     * 

"It  has  been  contended  to  you  by  couns;'l 
that  the  defendant  might  receive  this  propertv 
and  keep  it,  use  it,  and  sell  it,  and  still  it  is 
open  to  him  to  show  that  it  was  of  no  value 
wlien  he  received  it,  and,  therefore,  that  he 
is  not  required  to  pay  anything.  I  do  not  un- 
derstand that  to  be  the  law.  That  may  be 
and  is  the  rule  of  law  when  a  contract  of  .sale 
is  executed  with  a  contract  of  warranty  of  tlie 
thing  sold.  Then  the  warranty  goes  to  the 
purchaser  as  his  protection  against  defects 
that  may  be  discovered  in  the  thing  sold. 
But  this  is  not  an  executed  contract,— this 
written  contract  between  the  parties.  It  was 
executoiy."  "It  is  like  a  contract  for  sale  by 
sample,  where  a  merchant  agrees  to  sell  a  cer- 
tain commodity  which  shall  conform  to  a 
sample  which  he  delivers  to  tlie  purchaser. 
*  *  *  Still,  if  he  finds  that  it  does  not  in 
ail  respects  conform  to  the  sample,  he  has  the 
right  of  accepting  it,  aud,  if  he  does  accept 
it  as  a  compliance  with  the  contract,  he  is 
bound  to  pay  the  contract  price. 

"Comideriug  all  the  facts  as  sliown  to  you, 


WARRANTY. 


533 


3-011  must  dctpfinine,  if  you  are  not  fully  sat- 
iPlu'd  that  the  ice  iu  all  respects  conformed  to 
the  terms  of  the  contract,  whether  this  de- 
fendant accei)tt^  it  under  the  contract  so  as 
to  preclude  liim  from  throwing  it  back  onto 
the  hands  of  the  plaintitf. 

"When  he  took  the  pro[)erty  and  carried  it 
away  the  propertj-  passed  to  him." 

"If  you  do  find  an  acceptance  under  the 
rules  I  have  given  you,  I  say  to  you  that  the 
defendant  is  bound  to  pay  the  contract  price." 

"If  you  find  an  acceptance  of  the  property 
by  tlie  defendant,  then  he  is  liable  for  the  con- 
tract price." 

Tlie  defendant  excepted  to  these  rulings  and 
instructions. 

A.  N.  Williams,  for  plaintiffs.  C.  E.  Little- 
field,  for  defendant. 

PETERS,  0.  J.  The  controversy  in  this 
case  grows  out  of  an  agreement  between  plain- 
tiffs and  defendant,  made  and  delivered  in 
this  state,  which  runs  as  follows:  "This  agree- 
ment, made  and  entered  into  this  seventh  day 
of  Januaiy,  18SS,  by  and  between  Morse  A: 
Sawyer,  of  Bath,  Maine,  of  the  first  part,  and 
A^'arner  Moore,  of  Richmond,  Va.,  of  the  sec- 
ond  part,   witnesseth : 

"That  the  said  parties  of  the  first  part,  for 
and  in  consideration  of  the  sum  of  one  dollar 
to  them  in  hand  paid,  the  receipt  whereof  is 
hereby  acknowledged,  do  hereby  sell  and  agree 
to  deliver  at  their  wharves  at  Water  Cove, 
(Cape  Small  Point,  opposite  Burnt  Goat  Island, 
as  seen  in  Coast  Chart  No.  6,  from  four  to  six 
miles  west  of  Seguin  Island  light  house,) 
;Maine,  after  the  ice  has  become  twelve  inches 
iu  thickness,  of  good  quality,  during  the 
montlis  of  January  or  February,  1888,  two 
thousand  tons  of  good,  clear,  merchantable 
ice,  not  less  than  twelve  inches  in  thickness, 
to  be  weighed  by  a  sworn  weigher,  with  all 
the  proper  fitting  material  necessary  for  the 
vo.yage  included,  at  the  price  or  rate  of  forty 
cents  per  ton  of  two  thousand  pounds.  Each 
cargo  to  be  paid  for  on  presentation  of 
sight  draft  or  note  for  thirty  days  or  sixtj- 
days,  as  may  suit  party  of  second  part,  for 
the  amount  accompanying  bill  of  lading  and 
weigher's  certificate  of  said  cargo.  Cakes  to 
be  twentj'-two  by  thirty  inches." 

The  ice  delivered  under  this  contract  was 
shipped  to  Richmond.  Va.,  where  the  defend- 
ant resides,  to  be  sold  in  that  market  to  his 
customers.  It  was  to  be  paid  for  according 
to  its  weight  and  quality  at  the  port  of  ship- 
ment in  Maine,  any  deterio'-ation  of  the  arti- 
cle during  transit  being  at  the  risk  of  the 
purchaser. 

Tiie  first  question  submitted  to  the  jury  was 
whether  the  ice  had  been  accepted  by  the  de- 
fendant or  not.  and  that  was  decided  in  favor 
of  the  plaintiffs. 

That  brought  up  the  question  whether,  hav- 
ing- accepted  the  ice,  the  defendant  could  rely 
on  a  breach  of  the  warranty  of  the  quality  of 
the  ice  to  reduce  the  claim  of  the  plaintiffs 
who  sue  in  this  action  of  indebitatus  assump- 


sit for  the  contract  price;  the  defendant  al- 
leging that  the  ice  was  not,  at  the  time  and 
place  of  delivery  in  Maine,  of  the  quality  call- 
ed for  by  the  contract. 

The  judge  presiding,  being  of  the  impres- 
sion that  such  a  defense  might  be  admissible 
in  case  of  an  executed  agreement  containing 
warranty,  but  not  where  the  agreement  is  ex- 
ecutory, ruled  out  the  defense  as  a  matter  of 
law.  It  is  to  be  noticed  that  the  ruling  was 
without  qualification,  admitting  of  no  inquiry 
into  the  circumstances  iu  which  the  ice  was 
accepted.  It  determines  that  an  acceptance 
in  a  ca.se  of  this  kind  (in  the  absence  of  fraud, 
of  course)  absolutely  terminates  the  obligation 
of  the  vendor.  Tiie  judge  further  ruled  that 
"when  the  defendant  took  [that  is.  by  a  hired 
carrier]  the  property  and  carried  it  away  the 
property  passed  to  him." 

Our  examination  of  this  question  leads  us 
to  the  conclusion  that  the  position  of  the  de- 
fendant was  well  taken,  and  that  the  alleged 
defense  should  have  been  pernutted  to  him. 

That  there  is  a  warrantj'  or  a  condition  pre- 
cedent amounting  to  warranty  in  the  contract, 
there  can  be  no  doubt.  Such  a  warranty  will 
be  found  to  be  variously  characterized  in  the 
books  as  executoiy  warranty,  a  condition 
precedent  amounting  to  warranty,  iu  the  na- 
tui'e  of  warranty,  with  the  effect  of  warranty, 
equal  to  warranty,  and  the  fike.  It  is  imma- 
terial, for  present  purpose,  whether  it  be  re- 
garded as  an  express  warranty  or  an  express 
condition  implying  warranty,  as  the  eftect 
must  be  the  same.  One  kind  within  its  limit 
is  not  a  more  potential  ingredient  in  a  con- 
tract than  the  other,  the  difference  between 
them  being  only  in  the  style  of  agreement  to 
which  they  may  be  annexed.  An  exnress 
warranty  may  be  also  special,  however.  It 
is  now  well  settled  by  the  authorities  general- 
ly—our own  cases  included— that  a  sale  of 
goods  by  a  particular  description  of  quality 
imports  a  warrantj-  that  the  goods  are  or  shall 
be  of  that  description;  a  warranty  which  be- 
comes a  part  of  the  contract  if  relied  upon 
at  the  time  by  the  purchaser.  Bryant  v. 
Crosby.  40  Me.  9;  Randall  v.  Thornton.  43 
Me.  22u;  Hillmau  v.  Wilcox,  30  Me.  170; 
Gould  V.  Stein,  140  Mass.  570,  22  N.  E.  47, 
and  cases  cited.  Here  there  is  a  clear  de- 
scription of  both  the  kind  and  quality  of  the 
ice.— the  quality  to  be  merchantable. 

It  -was  conceded  at  the  trial  that  the  posi- 
tion relied  on  by  the  defense  would  be  legiti- 
mate were  it  an  executed,  instead  of  execu- 
toiy, contract  that  contained  the  warranty. 
Why  sh.ould  there  be  the  difference?  Certain 
early  New  York  cases,  which  will  be  further 
considered  hereafter,  by  which  the  rule  given 
at  the  trial  is  more  or  less  supported,  give  as 
a  reason  for  the  rule  that  iu  an  executory  con- 
tract any  article  of  a  particular  quality  may 
be  tendered  in  the  performance  of  the  con- 
tract, and  the  vendee  must  see  if  the  article 
agrees  with  the  terms  of  the  contract,  while 
in  an  executed  sale  the  agreement  is  tliat  a 
particular   article   actuallj-  delivered   possesses 


3:34 


WARRANTY. 


Iho  quality  stipulated  for.  This  undoubtedly 
expi-esscs  correctly  the  distinctiou  between 
tlio  classes  of  contract,  but  it  does  not  im- 
press us  that  there  should  be  such  an  essen- 
tial difference  in  their  effect.  The  reason  is 
not  palpable  why  the  vendee  in  the  one  case 
more  than  in  the  other  should  have  to  see 
that  he  receives  only  merchantable  articles 
when  a  delivery  is  made.  It  seems  inconsist- 
ent that  the  warranty,  which  is  a  part  of  ei- 
ther contract,  should  terminate  at  delivery  in 
one  contract,  and  not  in  the  other.  Each  ven- 
dor makes  virtually  the  same  warranty,  and 
th(>  two  vendors  at  the  point  of  delivery  would 
api)ea '  to  stand  upon  common  ground.  The 
seller  in  an  executory  contract  agrees  to  do 
what  the  seller  in  an  executed  contract  has 
already  done.  AVhen  he  tcniders  the  articles 
that  he  has  agreed  to  deliver,  such  articles 
iK'come  particularized  and  identilied;  and  he 
then  represents  that  such  particular  and  iden- 
tified articles  possess  the  quality  stipulated 
for  by  his  executory  agreement.  The  terms 
of  the  contract  of  sale  become  the  terms  of  the 
sale.  The  condition  precedent  becomes  a  war- 
ranty. Prof.  Wharton  (Whai't.  Cent.  S  .504) 
expresses  the  idea  in  these  words:  "A  sub- 
stantial, though  partial  (defective)  perform- 
ance of  a  condition  precedent,  followed  by  ac- 
ceptance on  the  other  side,  transmutes  the 
condition  precedent  into  a  representation,  (im- 
plying warranty,)  not  barring  a  suit  on  the 
contract,  though  leaving  ground  for  a  cross- 
action   for   damages." 

Executory  and  executed  contracts  are  very 
much  alike  in  the  elements  that  enter  into 
them.  There  are  executory  steps  in  all  ex- 
ecuted contracts.  A  bargain  precedes  the 
sale.  If  there  be  a  warranty,  that  is  usually 
first  a  part  of  the  bargain,  and  afterwards  of 
the  sale.  So  ia  an  executory  contract  the 
warranty  is  part  of  the  agreement  of  sale,  and 
at  delivery  a  part  of  the  sale.  Many  con- 
tracts commonly  spoken  of  as  executed  con- 
tracts are  really  wholly  or  partially  executory. 
All  orders  for  goods,  whether  for  present  or 
future  deliveiy,  are  of  an  executory  nature. 
AH  sales  by  sample  are  such.  The  author  of 
Smith's  leading  Cases  (8tli  Ed.  vol.  1.  pt. 
1,  p.  3.39)  says  in  discussing  this  distinction: 
"Where  the  vendor  agrees  to  sell  goods  of  a 
certain  kind,  without  design;  i  dug  or  referring 
to  any  specific  chattel,  fne  contract  is  essen- 
tially executory',  whether  it  purports  to  .be  a 
present  transfer  or  a  mere  undertaking  to  de- 
liver at  a  future  period,  and  the  right  of  prop- 
erty does  not  pass  until  the  merchandise  is 
delivered  to  or  set  apart  for  the  purchaser." 
Every  contract  is  executory  on  the  one  side 
or  the  other  until  the  party  has  done  wliat  he 
has  agreed  to  do. 

The  fact  of  acceptance,  however,  as  a  mat- 
ter of  evidence,  may  have  great  weiglit  on 
the  question  of  satisfactory  or  sufficient  per- 
formance. In  the  first  place,  it  raises  consid- 
eral>le  pre-^umptinn  that  the  article  delivered 
actually  corresponded  with  the  agreement. 
In  tile  next  place,    it   is   some  evidence   of  a 


waiver  of  any  defect  of  quality,  even  if  the 
article  did  not  so  correspond;  evidence  of 
more  or  less  force  according  to  the  circum- 
stances of  the  case.  If  the  goods  be  accepted 
without  objection  at  the  time  or  within  a 
reasonable  time  afterwards,  the  evidence  of 
waiver,  uidess  explained,  might  be  considered 
conclusive.  But  if,  on  the  other  hand,  objec- 
tion is  made  at  tlu;  time,  and  the  vendor  no- 
tified of  the  defects,  and  the  defects  are  ma- 
tei'ial,  the  inference  of  waiver  would  be  alto- 
gether repelled.  But  acceptance  accompanied 
by  silence  is  not  necessarily  a  waiver.  The 
law  i)ermits  explanation,  and  seeks  to  know 
the  circumstances  which  induced  acceptance. 
It  might  be  that  the  buyer  was  not  competent 
to  act  upon  his  own  judgment,  or  had  no  op- 
portunity to  do  so,  or  declined  to  do  so  as  a 
matter  of  expediency,  placing  his  dependence 
mainly,  as  he  has  a  right  to  do,  upon  the  war- 
ranty of  the  seller.  Upon  this  question  the 
facts  are  generally  for  the  jury,  under  the  di- 
rection of  the  court. 

The  law  of  waiver  more  commonly  applies 
to  things  that  are  not  essential  to  a  substan- 
tial execution  of  the  contract;  often  such  as 
relate  to  the  time,  place,  or  manner  of  per- 
formance, or  that  affect  merely  the  taste  or 
fancy,  perhaps,  and  are  such  departures  from 
literal  performance  as  do  not  bring  loss  or  in- 
jury upon  the  purchaser.  Baldwin  v.  Farns- 
worth.  10  Me.  414;  Lamb  v.  Barnard,  16  Me. 
3G4. 

We  think  the  rule  invoked  by  the  defend- 
ant a  just  one.  Speaking  generally,  it  is  the 
safer  rule  for  both  buyer  and  seller.  The  op- 
posite rule  imposes  on  either  of  them  veiy 
great  responsibility  and  risk.  It  might  be 
ruinous  to  a  vendee,  who  is  in  urgent  need  of 
an  article,  not  to  accept  it,  although  even 
much  inferior  in  quality  to  the  description 
contained  in  the  contract.  Certainly  it  should 
not  be  considered  a  hardship  to  a  seller  to  re- 
quire of  him  a  compliance  with  his  contract, 
or  damages  for  his  non-compliance. 

The  present  case  illustrates  the  justness  of 
the  iide,  if  the  facts  are  proved  as  the  de- 
fendant alleges  them.  The  plaintiffs  agreed 
to  deliver  ice,  which  they  warranted  sliould 
be  good,  clear,  and  merchantable.  Two  car- 
goes were  loaded  for  shipment  to  a  southern 
port.  Defendant  furnished  the  vessels, 
though  they  were  probably  chartered  by  the 
plaintiffs  on  the  defendant's  account.  There 
is  nothing  in  the  charge  of  the  judge,  in  the 
exceptions,  or  on  briefs  of  counsel,  intimat- 
ing tliat  the  defendant  ever  saw  the  ice,  ei- 
ther by  agent  or  personally,  until  it  arrived 
in  Virginia,  or  that  he  was  notified  to  be  pres- 
ent, or  knew  of  the  delivery  at  the  time  of  it. 
It  would  seem  to  be  a  rather  stringent  con- 
struction of  the  contract  that  the  defend- 
ant must  watch  the  loading  of  the  cargoes, 
upon  the  penalty,  if  he  failed  to  do  so,  of 
having  to  pay  full  price  for  whatever  de- 
fective ice  might  be  delivered  behind  his- 
back,  after  he  had  taken  for  his  protection, 
and  paying  for  it  in  the  consideration  of  the- 


WARRANTY. 


33i 


contract,  au  agreement  of  waiTjiiity  iu  such 
positive  terms.  Still  it  may  bo  that  the  plain- 
tiffs could  le^ially  refuse  to  deliver  the  ice 
ludess  the  defendant  after  notice  should  be 
present  to  receive  it.  The  cargoes,  after  rea- 
sonal)le  passages,  arrived  in  a  very  unmer- 
chantable condition.  There  was  no  lack  of 
objection  or  protest  from  the  defendant.  He 
wrote  repeatedly,  and  telegrai)hed  the  plain- 
tiffs, expressing  his  disappointment,  and  ask- 
ing their  advice  as  to  the  disposition  of  the 
ice.  But  no  satisfactory  answer  came. 
What  shovdd  he  do?  There  was  no  possi- 
bility of  reshipment.  nor  coidd  the  ice  be 
preserved  in  that  climate  without  the  pro- 
tection that  his  own  ice-houses  would  afford 
for  such  purpose.  Storage  in  any  ordinary 
manner  could  not  possiblj'  save  the  property. 
He  stored  the  ice,  and  sold  it  by  enterprising 
expedients  as  rapidly  as  possible.  He  al- 
leges that  it  was  late  spring  ice,  of  poor  tex- 
ture, and  in  proximately  worthless  condition 
when  shipped  from  Maine.  If  that  can  be 
shown  by  witnesses  and  in  court  at  the  home 
of  the  plaintiffs,  it  would  seem  to  be  an  in- 
justice if  the  defendant  is  not  permitted  to 
make  the  defense 

INIr.  Benjamin,  (Benj.  Sales,  3d  Am.  Ed.  p. 
888.)  in  allusion  to  the  buyer's  remedies  after 
receiving  possession  of  the  goods,  says  he 
has  three  remedies  against  the  seller  for 
breach  of  the  warranty  of  quality:  I<'irst, 
the  right  to  reject  the  goods  if  the  property 
in  them  has  not  passed  to  him;  second,  a 
cross-action  for  damages  for  the  breach; 
third,  the  right  to  plead  the  breach  in  defense 
to  an  action  by  the  vendor,  so  as  to  diminish 
the  price.  These  remedies  are  mentioned 
without  any  distinction  between  kinds  of 
sales.  The  propositions  are  general,  without 
any  intimation  that  the  procedure  does  not 
fipply  to  warranties  in  executory  sales.  In 
the  text  such  a  distinction  is  not  even  no- 
ticed. In  the  notes  to  the  text,  however,  it 
is  remarked  bj'  the  American  editor  that 
there  are  New  York  decisions  inconsistent 
with  the  rule  stated  in  the  text.  The  first  of 
these  remedies— that  of  rejecting  the  goods 
— seems  especially  applicable  to  executory 
and  inapplicable  to  executed  sales,  because  it 
precedes  acceptance,  while  in  executed  sales 
there  has  been  acceptance,  and  the  title  has 
passed.  It  is  only  in  executory  contracts 
and  contracts  that  are  mer(>ly  prima  facie 
executed  that  the  title  has  not  passed. 

Mr,  Benjamin  states  further  tnat  the  buy- 
er's remedies  are  not  dependent  on  nis  re- 
turn of  the  goods,  nor  is  he  bound  to  give 
notice  to  the  vendor;  "but,"  he  adds,  "a 
failure  to  return  the  goods  or  comi)iain  of 
the  quality  raises  a.  strong  presmnption  that 
the  complaint  of  defective  quality  is  not  well 
founded."  Prof.  Parsons,  in  the  text  and 
notes  of  his  work  on  Contracts,  lays  down 
the  same  legal  propositions  that  Mr.  Benja- 
min does,  making  not  a  word  of  allusion  to 
there  being  any  dilfereuce  in  the  application 
of  them  between    sales   executed  and   sales 


executory.  He  also  states  that  if  the  buyer 
accepts  goods  inferior  to  such  as  are  stipu- 
lated for,  his  continued  possession  wlvnout 
complaint  will  be  a  presumption  against  him 
on  the  question  of  damages.  Pars.  Cont. 
(Oth  Ed.)   *.7J1,  and  notes. 

Mr.  Smith,  in  J>eading  Cases,  in  notes  to- 
the  case  of  Chandelor  v.  Lopus,  (8th  Kd., 
vol.  1,  pt.  1,  p.  294,)  discusses  and  fully  in- 
dorses the  same  rules,  as  deducible  from  the 
authoiities,  and  he  and  the  editors  in  the  last 
American  edition  of  that  work  cite  and  com- 
pare a  great  many  of  the  decidea  cases  on 
the  subject,  and  they  give  no  recognition  to 
a  distinction  between  executed  and  execu- 
tory contracts  in  the  application  of  such  rem- 
edies. We  quote  a  few  pas.sages  from  their 
comments:  "AVhen  specihc  property  is  refer- 
red to,  stiU,  if  the  reference  be  through  the 
medium  of  a  sample,  the  contract  will  be  so- 
far  executory  as  to  fail  of  effect  unless  the 
bulk  of  the  commodity  corresponds  with  the 
sample."  "Nor  will  his  [buyer's]  right  to  in- 
demnity or  compensation  necessarily  end  on 
his  acceptance  and  u,se  of  the  goods  with  full 
knowledge  of  the  defect,  but  he  will  be  enti- 
tled to  bring  suit  on  the  contract,  and  re- 
ceive damages  for  the  breach  of  the  implied 
engagement  that  the  bulk  of  the  commodity 
should  correspond  with  the  sample  exhibited 
at  the  time  of  the  sale."  In  the  case  at  bar 
there  was  an  ideal  or  descriptive  sample, — 
a  description  eqtiivalent  to  the  exhibition  of 
a  sample.  There  can  be  no  doubt  that,  if 
the  vendee  may  bring  an  action  of  his  own 
on  the  contract,  he  can  as  well  defend  against 
an  action  brought  upon  the  contract  by  the 
vendor.  '"The  right  of  the  vendee  to  rely 
(in  the  breach  of  warranty,  or  a  faihu-e  to 
comply  with  the  terms  of  an  executory  con- 
tract, as  a  defense  to  an  action  for  the  pur- 
chase money  may  now  be  regarded  as  estab- 
lished in  England,  and  in  most  of  the  courts 
in  this  country."  "The  course  of  decision  at 
the  present  day  tends  towards  the  position 
that  a  partial  failure  of  consideration  may 
bo  given  in  evidence  in  mitigation  of  dam- 
ages, even  when  the  original  contract  re- 
mains iu  full  force,  and  the  suit  is  expressly 
or  impliedly  fotmded  upon  it."  "In  the  case 
of  AA'ithers  v.  Greene,  9  How.  21.3.  the  su- 
preme court  of  the  United  States  receded 
from  the  groinid  taken  in  Thornton  v.  Wynn, 
12  Wheat.  183,  by  holding  that  a  partial  fail- 
ure of  consideration,  growing  out  of  fraud  or 
breach  of  warranty,  may  be  set  tip  as  a  de- 
fense to  an  action  brought  by  the  vendor. 
The  same  rule  applies  to  sales  under  an  ex- 
ecutory contract  or  by  sample,  and  the  buyer 
may  rely  on  the  deficiency  of  value  resulting 
from  the  failure  of  the  property  sold  to  cor- 
respond with  the  terms  of  the  contract  as  a 
reason  why  he  should  not  be  compelled  to 
pay  the  price  in  full.  Mondel  v.  Steel.  S 
Mees.  &  W.  8r)S;  Babcock  v.  Trice,  18  111.  420; 
Dailey  v.  Green.  1.5  Pa.  St.  118." 

We  are  unable  to  find  in  the  English  cases 
much  support  for  any  discrimination  in  the- 


me 


WARRANTY. 


application  of  the  above  doctrine  between 
sales  execntert  and  sales  executory,  altliougli 
very  many  of  the  modern  l<:n.iilish  cases  arise 
out  of  sample  sales  and  other  contracts  of  an 
executory  natiu-e.  Tlie  principal  support  for 
it  is  found  in  some  of  the  New  York  cases 
and  in  those  of  a  few  other  states  that  have 
followed  the  lead  of  the  New  York  court  in 
this  respect.  There  are  cases  whicli  hold  to 
a  modification  of  some  of  these  forms  of  rem- 
edy, having  no  bearing,  however,  on  the  de- 
cision of  the  present  case.  Some  courts  have 
held  that  a  rejection  or  i-escission  is  not  al- 
lowable if  the  goods  tendered  are  of  the  kind 
or  species  contiacted  for,  even  though  the 
quality  be  Inferior;  but  in  this  state  the  doc- 
trine of  rescission  in  cases  of  warranty  has 
been  fully  established.  Marston  v.  Knight, 
2!)  Me.  341.  In  a  few  cases  there  is  a  lean- 
ing towards  the  doctrine  that  an  acceptance 
becomes  a  waiver  after  a  long-continued  ac- 
<iuiescence  on  the  part  of  the  venaee.  1 
Smith.  Lead.  Cas.  (8th  Ed.)  part.  1,  pp.  324, 
320,  3G0,  362,  et  seq. 

It  is  noticeable  that  in  the  more  modern 
English  cases  the  courts  have  preferred  to 
regard  executoiy  contracts  as  based  upon  a 
condition  precedent,  rather  tlian  upon  war- 
ranty. No  essential  difference  of  remedy  fol- 
lows from  it,  though  a  different  style  of 
pleading  may  be  apposite.  Instead  of  a 
breach  of  warranty  and  a  suit  upon  war- 
ranty, it  becomes,  on  the  new  idea,  a  failui-e 
to  perform  a  condition  precedent  and  a  suit 
on  the  contract.  In  leading  cases,  before 
cited,  the  commentator  expresses  the  theory 
in  an  alternative  way  in  these  words:  "The 
right  of  a  vendee  to  rely  on  a  breach  of  a 
mere  warranty,  or  a  failure  to  comply  with 
the  terms  of  an  executoiy  contract,  as  a  de- 
fense to  an  action  for  the  purchase  money, 
may  now  be  regarded  as  established  in  Eng- 
land, and  in  most  of  the  courts  in  this  coun- 
try." But  the  editor  at  the  same  time  says 
(page  334)  that  "such  cases  have  generally 
proceeded  on  the  ground  of  an  express  or  im- 
plied warranty."  See,  also,  in  2  Smith,  Lead. 
Cas.  pt.  1,  the  discussion  under  case  of  Cut- 
ter V.  Powell,  at  pages  18,  20,  22,  et  seq.  Mr. 
Benjamin  inclines  to  the  view  taken  in  the 
English  cases,  quoting  Lord  Abinger  as  de- 
precating the  prevalent  habit  of  treating  a 
condition  precedent  as  a  warranty.  Other 
writers  incline  favorably  towards  the  views 
of  Lord  Abinger  as  expressed  by  him  in  the 
case  of  Chanter  v.  Hopkins,  4  Mees.  &  W. 
399,  although  admitting  that  the  prevailing 
theory  continues  the  other  way. 

The  length  of  this  opinion  reasonably  pre- 
cludes furtlier  discussion  of  points  that  may 
be  regarded  as  merely  theoretical.  Whether, 
in  the  present  case,  it  be  a  condition  or  a 
warranty,  and  that  might  be  at  the  election 
of  the  defendant  to  determine  as  he  pleased, 
we  think  the  defense  set  up  to  the  action 
should  have  been  heard  upon  the  ground  of 
a  breach  of  condition,  or  of  warranty,  or  up- 
on both  grounds. 


The  main  question  for  our  decision  has  not 
been  the  subject  of  much  discussion  in  our 
own  state,  although  the  principle  involved 
has  been  acted  on  in  a  great  number  of  in- 
stances, and  there  have  been  judicial  expres- 
sions and  rulings  affecting  it.  In  Folsom  v. 
Mussey,  8  Me.  400,  it  is  allowed  that  eviaouce 
of  consideration  may  be  received  in  actions 
between  parties  to  a  contract,  to  reduce  the 
damages.  In  Herbert  v.  Ford,  29  Me.  54G, 
the  doctrine  is  approved.  Rogers  v.  Humph- 
rey, 39  Me.  382,  directly  applies  to  the  pres- 
ent facts.  It  is  there  held  that  "when  a 
party  seeks  to  recover  payment  for  ai'ticles 
delivered  under  a  special  contract  which  he 
has  not  fully  performed,  the  damages  suf- 
fered by  such  breach  may  legally  be  deducted 
in  the  same  suit."  The  case  of  Peabody  v. 
Maguire,  79  Me.  572,  12  Atl.  G30,  in  its  effect 
sustains  the  same  principle.  It  is  there  de- 
cided that  in  a  conditional  sale  the  mere  fact 
of  delivery  by  the  vendor  without  perform- 
ance by  the  vendee,  nothing  being  at  the 
+ime  said  about  the  condition,  might  afford 
presumptive  evidence  of  the  waiver  of  the 
condition,  but  that  the  fact  may  be  explained 
and  controlled,  and  whether  it  be  a  waiver 
of  the  right  of  title  or  not  would  be  a  ques- 
tion of  fact  to  be  ascertained  from  the  tes- 
timony. So  in  the  present  case,  whether  ac- 
ceptance be  a  waiver  of  the  full  perrormance 
of  the  condition  precedent  or  not  is  likewise 
a  question  to  be  settled  upon  testimony.  The 
position  of  parties  is  reversed  in  the  two 
cases,  but  the  principle  is  tiie  same. 

The  first  case  in  this  country,  except  a 
Maiyland  decision  to  the  same  effect,  and 
perhaps  the  leading  case  in  the  recognition 
of  the  principle  that  affirmation  of  quality  es- 
tablishes warranty,  is  Hastings  v.  Loverlng. 
2  Pick.  214.  where  oil  then  in  Nantttcket  was 
sold  to  be  delivered  in  Boston  in  ten  days, 
the  vendor  describing  the  same  to  be  "prime 
winter  oil."  That  was  in  fact  as  much  of 
an  executoiy  contract  as  is  the  one  tinder 
discussion,  although  not  in  form  such.  The 
point  was  taken  in  the  trial  that  the  con- 
tract, althotigh  executory,  was  settled  by  a 
bill  of  parcels,  given  at  delivery,  the  execu- 
tory agreement  having  no  fttrther  effect;  but 
the  court  overruled  the  posilion.  The  case 
is  effective  on  the  present  question  as  show- 
ing that  acceptance  has  no  greater  effect  as 
an  estoppel  in  exectitory  than  in  executed 
sales.  Other  Massachusetts  cases  bear,  ei- 
ther directly  or  indirectly,  upon  the  qtiestion. 
In  none  of  them  is  there  any  judicial  utter- 
ance indicating  that  executory  and  executed 
sales  do  not,  on  this  question,  stand  alike. 
Perley  v.  Balch,  23  Pick.  283;  Dorr  v.  Fisher, 
1  Cush.  274;  Henshaw  v.  Robins,  9  Mete. 
(Mass.)  S3;  Mixer  v.  Coburn.  11  Mete.  (Mass.) 
rjoD;  Morse  v.  P.rackett,  98  Mass.  20.j.  Sev- 
eral Connecticut  cases  that  are  often  cit- 
ed as  supporting  the  theory  that  description 
imports  warranty,  and  that  the  defendant 
may  recoup  damages  for  a  breach  of  con- 
tract if  the  vendor  brings  a  suit,  were  cases 


WARRAXTY. 


337 


of  executory  contracts  or  sales.  McAlpiu 
V.  Lee.  12  Coiin.  129;  Kellogg  v.  Deiislow,  14 
Conn.  411.  And  of  the  same  character  Is 
the  leading  case  in  the  supreme  court  of  the 
United  States  on  the  same  question.  Lyon 
V.  Bertram,  20  How.  150.  In  that  case  the 
vendor  was  to  deliver  a  cargo  of  flour  within 
three  weeks,  the  price  to  be  according  to  the 
inspection  to  be  made  at  delivery.  The  con- 
tract was  in  form  a  sale,  but  in  effect  a  con- 
tract for  future  sale  and  delivery.  The  same 
deduction  may  be  made  from  the  cases  of  so 
many  of  the  states  that  the  rule  may  be  falr- 
Ij'  cliaracterized  as  general;  and  the  same  re- 
sult is  producible  from  the  English  cases. 

The  New  York  court  held  in  earlier  cases 
that  warranty  in  an  executory  contract  did 
not  in  ordinary  circumstances  survive  deliv- 
ery and  acceptance.  But  the  doctrine  grew 
up  from  the  theory  of  law,  maintained  for  a 
great  while  by  that  court,  that  desci'ii)tion  of 
quality  is  not  a  warranty  of  quality.  In 
Leading  Cases,  before  cited,  it  is  said,  in  dis- 
tinguishing the  New  York  theory  from  that 
of  Massachusetts  and  Pennsylvania:  "The 
authorities  in  New  York  assume  that  calling 
a  thing  by  a  particular  name,  or  designating 
as  of  a  certain  quality,  is  no  evidence  of  a 
wan-anty  or  contract  that  it  should  be  as  de- 
scribed." Certainly  a  thing  cannot  survive 
that  does  not  exist.  Wilde,  J.,  in  Henshaw 
V.  Robins.  9  Mete.  (Mass.)  00,  declared  upon 
that  ground  that  the  authorities  in  New  York 
were  without  influence  upon  the  (piestion  of 
effect  of  acceptance  in  Massachusetts,  say- 
ing: "Opposed  to  these  authorities  are  the 
cases  in  New  York;  but  these  were  deter- 
mined on  the  assumption  that  there  was  no 
warranty  express  or  implied,  and  they  there- 
fore have  no  bearing  on  the  question  as  to 
the  effect  of  the  inspection  of  the  goods  sold 
by  the  purchaser." 

VAN  ZILE  SEL.  CAS.  SALES— 33 


The  last-named  rule  of  the  New  York  cases 
was  found  to.be  so  much  at  variance  with 
the  authorities  elsewhere  that  in  the  case  of 
White  V.  :Miller,  71  N.  Y.  118,  all  previous 
cases  which  held  that  warranty  did  not  fol- 
low from  description  of  quality  were  over- 
ruled; and,  as  a  natural,  if  not  necessary, 
consequence  thereof,  the  tendency  of  that 
court  seems  in  later  cases  to  have  been  pro- 
gressive towards  the  adoption  of  the  other 
rule,  that  acceptance  in  cases  of  executory 
sales  with  warranty  does  not  preclude  tlie 
vendee  from  afterwards  claiming  damages 
against  the  vendcjr  for  a  breach  of  the  war- 
ranty; if  the  court  has  not  already  arrived  at 
that  point.  There  are  late  cases  in  that 
state,  of  express  warranties,  the  doctrine  of 
which  seems  to  completely  vindicate  the  po- 
sition of  the  defendant  in  the  present  case, 
even  should  he  be  obliged  to  stand  or  fall 
upon  the  interpretation  of  the  law  of  his  con- 
tract according  to  the  New  York  authorities. 
In  Brigg  v.  Hilton,  99  N.  Y.  517,  3  N.  E.  51, 
and  in  Canning  Co.  v.  Metzger,  118  N.  Y.  200, 
23  N.  E.  372.  it  is  declared  that  an  express 
imdertaking  to  deliver  in  the  futtu-e  articles 
of  a  certain  quality  was  an  express  warranty 
of  such  quality  when  the  articles  were  after- 
wards delivered, — a  warranty  that  sui-vlved 
an  acceptance  of  the  articles  delivered;  and 
that  the  rule  would  be  the  same  whether 
the  goods  were  in  existence  at  the  time  of 
contract  of  sale  or  were  to  be  manufactured. 

Upon  the  authority  of  these  cases  the  con- 
tract in  the  case  at  bar  contains  an  express 
Avarranty.  An  express  undertaking  to  pro- 
duce a  thing  is  an  express  warranty  of  the 
thing  produced. 

Exceptions  sustained. 

WALTON,  VIRGIN,  LIBBEY.  HASKELL, 
and  WHITEHOUSE,  JJ.,  concurred. 


338 


WARRANTY. 


CROLY   V    rOl.LARD. 
CM)  X.  AY.  85o,  71  Mi<li.  <•!-.) 
Suprcni.'  ('unit  of  Michigan.     Oct.  10,  1S.S8. 
Apptiil  from  circuit  court,  Woxford  county, 
ill  chancery;    Sihis  S.  Fallass.  Judge. 

('.  ('.  Chittenden,  for  aitpcUant.  Sawyer  & 
F.ishdp.  for  appellee. 

SIIKKAYOOD,  C.  J.  This  case  is  an  appeal 
from  the  Wexford  cin-uit  court,  in  chancery. 
The  case  appears  froni  the  record  as  follows: 
The  complainant  bought  a  locomotive  boiler, 
and  engines  belonging  thereto,  of  the  defend- 
ant. November  127.  ISSJ.  for  .$300,  and  took  a 
bill  of  sale  for  the  same,  making  payment 
tlierefor  by  two  notes,  one  for  .$100.  payable 
in  six  mouths,  and  tik-  other  for  $2(M).  payable 
in  one  year.  These  notes  complaiuant  secured 
l)y  a  mortgage  on  real  estate  in  the  county  of 
Wexford.  Comi)lainaut  placed  the  boiler  and 
engines  in  a  shop,  and  about  two  years  there- 
;ifter  the  property  was  taken  from  him  by  writ 
of  replevin  under  a  claim  made  by  a  Mr. 
Simons  of  paramount  title.  Complaiuant 
thereupon  notified  the  defendant  of  the  writ 
and  of  the  claim  made  therein,  and  requested 
him  to  defend  the  title  to  the  property.  This 
the  defendant  refused  to  do.  claiming  that  he 
never  had  any  title  thereto,  and  never  sold 
the  same  co  the  complainant,  and,  the  com- 
l^lainant  making  u.j  defense.  Simons  succeeded 
in  his  suit,  and  complainant  lost  his  property 
under  the  title  made  by  Simons.  The  only 
consideration  received  by  the  complainaut  for 
his  mortgage  given  to  defendant  was  the  boiler 
and  engine.  The  consideration  liaving  wholly 
failed,  the  complainant  requested  the  defend- 
ant to  disehaige  the  mortgage,  which  he  re- 
fused to  do.  and  thereupon  defendant  fore- 
closed the  mortgage  by  advertisement,  and  bid 
off  the  property  upon  the  sale.  Complainant 
prays  for  a  decree  setting  aside  the  sale  and 
anuulling  the  mortgage.  The  defendant,  in 
liis  answer,  avers  that  he  did  not  sell  the  boil- 
er and  engine  to  the  complainant,  but  that 
coaiplaiuant  purchased  them  from  John  Kose- 
velt  and  Robert  Christenseu.  and  that  defend- 
ant loaned  complainant  the  money  with  which 
to  make  the  purchase,  and  took  the  mortgage 
above  mentioned  as  security  for  his  loan;  that 
he  had  never  seen  the  boiler  and  engine  in 
(luestiou  until  a  long  time  after  complainant 
made  his  purchase  of  Rosevelt  and  Christen- 
seu. The  case  was  heard  upon  pleadings  and 
proofs,  and  the  circuit  judge  granted  a  decree 
in  accordance  with  the  prayer  of  the  bill,  and 
defendant  appeals. 

The  testimony  in  the  case  was  taken  before 
the  circuit  judge  in  open  court.  l"i)ou  the  ma- 
terial point  in  the  case  there  is  a  contradiction 
l)etween  the  parties  in   their  testimony.     The 


circumstances  of  the  case,  and  the  written  tes- 
timony, however,  are  coiroborative  of  the  tes- 
timony of  the  complainaut.  The  question  in 
the  case  is,  was  the  mortgage  given  by  the 
complainant  to  the  defendant  for  the  loan  of 
$3(J<),  or  was  it  given  to  the  defendant  as  the 
purchase  price  of  the  boiler  and  engine  men- 
tioned? The  title  to  the  property,  which  the 
complainaut  received,  came  originally  from 
Rosevelt  and  Christensen.  Christenseu,  on 
the  7th  day  of  September,  1883,  transferred 
the  property  to  Rosevelt,  by  written  bill  of 
sale,  with  warranty  of  title,  and  Rosevelt  sold 
and  transferred  the  property  by  a  like  bill  of 
sale  and  warranty  to  the  defendant,  ou  the 
27th  day  of  November,  1887.  and  the  defend- 
ant, in  his  testimony,  says  he  supposed  that, 
when  he  conveyed  by  his  bill  of  sale  the  pro])- 
erty  to  the  complainant,  he  got  title  thereto. 
That  bill  of  sale  reads  as  follows:  "For  a 
valuable  consideration  to  me  in  hand  paid  by 
.Tames  Croly,  I  lieieby  transfer  and  set  over  to 
the  said  .Tames  Croly  all  my  right,  title,  and 
interest  in  the  locomotive  boiler  and  engines 
mentioned  in  the  written  bill  of  sale."  This 
was  Avritten  on  the  back  of  the  bill  of  sale 
from  Rcsevelt  to  the  defendant,  and  was  duly 
signed  by  the  defendant,  and  dated  the  day 
the  complainant  made  his  purchase.  It  is 
claimed,  however,  by  counsel  for  the  defend- 
ant this  bill  of  sale  never  gave  the  complain- 
ant any  warranty  of  title  to  the  property,  ei- 
ther express  or  implied.  The  complainant  tes- 
tifies that  he  bought  the  property  of  the  de- 
fendant, and  gave  his  notes,  secured  by  the 
mortgage,  therefor,  and  the  defendant,  when 
asked  for  a  bill  of  sale  of  the  property,  gave 
the  complainant  the  one  above  quoted.  There 
is  uo  doubt.  I  apprehend,  but  that  a  sale  of 
persoual  property  implies  an  affirmation  by 
the  vendor  that  the  property  is  his.  and  he 
therefore  warrants  the  title,  unless  it  is  shoAvn 
by  the  facts  and  circumstances  accompanying 
the  .sale  that  the  vendor  did  not  intend  to  as- 
sert ownership,  but  only  to  transfer  such  in- 
terest as  he  might  have  in  the  property.  It 
is  claimed  on  the  part  of  the  defendant  that 
such  facts  and  circiimstances  were  shown  in 
this  case,  and  there  is  testimony  to  that  effect. 
It  is,  howevei,  contradicted  upon  the  other  side 
l)y  the  testimony  of  the  complairumt.  The 
circuit  judge  heard  all  the  testimony.  The 
witnesses  were  before  him.  His  means  of 
judging  of  the  credibility-  of  the  testimony  of- 
fered was  far  superior  to  ours,  and  it  appears 
from  the  decree  rendered  he  found  against  the 
defendant,  and  I  do  not  think  we  should  be 
justified  in  disturbing  that  finding.  The  pre- 
ponderance of  the  testimony  is  clearly  with 
the  complainant.  The  decree  at  the  circuit 
must  be  affirmed,  with  costs.  The  other  jus- 
tices concurred. 


WARRANTY. 


339 


AVISCUNSIX   RED    PRESSED-BRICK    CO. 
V.  HOOD  et  al. 

(50  X.  W.  lOo.  54  Minn.  543.t 

Supreme  Court  of  Minnesota.      Sept.  8.  1S03. 

Appeal  from  district  court.  St.  Ix)Uis  couu- 
ty;  Ensifin.  Judge. 

Action  by  the  Wisconsin  Red  Pressed-Brick 
Company  ajrain.-^t  David  HcxkI  and  otliers  to 
foreclose  a  lien  for  materials  usl><1  in  erect- 
ing a  building.  .Tudgnieut  for  defendants, 
and  new  trial  denied.  Plaintiff  appeals. 
Reversed. 

Wni.  Lancaster,  for  api)ellant.  Wm.  B. 
Phelps  and  White,  Reynolds  &  Schmidt,  for 
respondents. 

COIJJXS.  .1.  Plaintiff  corporation,  having 
furnished  a  quantity  of  bricl<s  for  use  in  tlie 
erec-tion  of  a  factory  ituilding  and  an  en- 
gine house  for  defendant  refrigerator  com- 
pany, brought  this  action  to  foreclose  its 
lien.  The  factory  had  been  btiilt  by  de- 
fendant Hood  tmder  a  eon t met  with  tlie 
refrigerator  company,  while  the  engine  house 
had  been  erecteil  by  the  c-ompany  itself, 
Hood  having  been  the  supi'rintemlent  of  the 
work.  All  of  the  bricks  were  purchased 
by  Hood,  the  agreement  for  the  same  being 
m  writing,  and.  according  to  its  terms,  plain- 
tiff was  to  furnish  free  on  board  cars  at 
its  yards,  for  $5.50  per  thotisand,  a  specified 
ipiantity  of  bricks  ""of  the  grade  kuo^^^l  as 
•common  brick,'  "  and  all  to  be  "of  good 
tpiality.  and  eqtial  to  sample  sent"  by  the 
superintendent  of  the  yards.  I'nder  the 
contract  for  the  erection  of  the  factory 
l)uilding,  also  in  writing.  Hood  was  to  use 
"tlie  best  qtialitj-  of  red,  kiln-run.  weU- 
biirned  Menominee  brick,  or  some  other  red 
brick  equally  as  good  and  acceptable."  Up- 
on the  trial  of  the  cause,  without  a  jury, 
the  court  below  found  the  contract  between 
tlie  defendants  to  be  as  above  stated,  but 
that  Hood  did  not  use  "kiln-ntn"  bricks,  as 
he  had  agreed.  It  also  found  that  plaintiff 
had  contracted  witli  Hood  to  furni.sh  "tX)m- 
mon  brick,  of  good  quality,  to  be  u.sed  in 
the  erection  of  a  factory  and  war-ehouse 
and  engine  house,"  at  $5.50  per  thousand, 
and  with  full  notice  and  knowledge  that 
tliese  bricks  were  to  be  used  in  the  erection 
of  "said  warehotrse."  Tliere  was  no  find- 
ing whatever  as  to  whether  the  bricks  fitr- 
nished  were  to  or  did  corrvspond  with  the 
sample  sent.  It  was  also  foimd  that  "many" 
of  the  brick  ftrrnislied  and  ustnl  in  the  con- 
struction of  the  btuldings  were  not  common 
briuk  of  good  quality,  nor  were  they  fit  or 
proper  to  be  trsed  in  the  walls,  the  defects 
being  specifically  stated,  and.  frrrther.  that 
sueli  defects  could  not  have  been  ascertained 
before  the  walls  were  built,  and  tlie  defective 
bricks  exposed  to  the  elements  upcm  outside 
surfaces,  for  at  least  one  rnontli.  It  was 
further  foimd  that,  "had  said  brick  been 
of  the  quality  and  kind  called  for  by  the 
lorms  of  the  conu-act  between  plaintiff  and 


said  Hood  and  said  Hood  and  the  refrig 
erator  company,  and  as  agreed  by  plaintiff, 
they  would  have  beeir  worth"  the  agreoil 
price,  but,  Ixnause  of  the  defects  metitionetl. 
they  were  worth  but  $2.50  per  thousand. 
From  the  corrdusion  of  law  it  may  be 
gatliered  that  this  finding,  althotigh  vague 
and  indefinite  as  to  whether  it  fixes  the 
value  of  the  "many"  bricks  previotr.sly  re- 
ferr-ed  to  as  failing  to  meet  the  contract,  or 
the  valire  pt-r  thousiind  of  the  entire  qtran- 
•tity  furnishetl.  has  reference  to  the  latter. 
It  is  the  only  fintling.  however,  in  wliich  the 
amount  of  damages  sustained  liy  defendants, 
because  of  the  alleginl  brvach  of  plaintiff's 
contract,  is  fixed  or  attempttMl  to  be  fixed.  If 
imsupportwl  by  the  eviderrce.  or  insulficient 
to  warrant  the  conclrr.sion  of  law  by  which 
the  vahre  of  the  eutiiv  quantity  of  bricks 
fm-nishe;l  by  plaintiff  was  reductvl  to  .S'J.5(» 
per  thousand,  a  new  trial  nurst  be  had.  and 
this  remark  applies  to  all  of  the  findings 
of  fact  covered  bj-  plaintiff's  a.ssignments  of 
eaTor. 

Counsel  for  defendant  Hood  evidently 
tried  this  case  upon  the  theory  that  ther-e 
was  an  implied  or  an  express  warranty  that 
tlie  bricks  to  be  ftrniislied  tmder  the  contract 
between  plaintiff"  and  Hood  sliould  be  suit- 
able for  the  walls  of  the  factory  and  the 
errgine  house,  and  in  his  brief  it  is  asserte<l 
tliat  there  was  both  an  implied  and  expre.ss 
warranty  of  this  natiu-e.  the  claim  being 
predicated  upon  tJie  fact  that  plaintiff  knew. 
\Vhen  making  tlie  contract,  that  Hood  in- 
tended to  use  the  bricks  in  the  walls  of 
the  building  lie  had  agreed  in  wr-itmg  to  erect 
for  the  refrigerator  company;  while  corrnsel 
for  the  latter  present  their  cjtse  on  appeal 
as  if  the  court  had  found  as  a  fact  that 
the  lir'icks  to  be  firrnished  were  to  cor*- 
respond  with  certain  samples,  and  had 
failed  so  to  do.  as  to  which  the  findings  are 
silent,  as  before  stated.  Therefor-e  some 
confusion  necessarily  arisi^s  as  to  the  ground 
upon  which  counsel  claim  that  the  order 
refirsiug  a  new  trial  is  siLstaiuable.  It 
seems  to  be  conceded  that  the  iilaintiff's 
contract  was  executory.  It  may  have  been 
a  sale  by  sample,  and.  if  .so,  the  bricks  fur- 
nislied  may  not  have  been  in  compliance  with 
the  requirements,  birt  these  qirestioiLs  are  not 
before  us  for  obvious  reasons.  As  the  con- 
tract was  in  writing,  and  aU  of  the  condi- 
tions respecting  qirality  have  been  stated, 
it  is  phiiri  that  there  was  no  express  warr;iiity 
of  tlie  bricks.  Xor  can  any  warranty  not 
implied  from  its  terms  be  added,  either  by 
implication  of  law  or  by  parol  proof,  to  the 
written  contract.  It  was  sliown  by  undis- 
puted testimorry  that  there  were  several 
gr-ades  of  bricks  known  to  the  trade,  the 
cheapest  and  poorest  being  the  grade  men- 
tioned in  plaintiff's  contract  with  Hood, 
namely,  "common."  A  better  and  more  ex- 
pensive gr-ade  is  styled  "kiln  run."  and  it 
»vas  this  grade,  not  "common."  which  H(X)d. 
iu  his  contract  with  the  refrigerator  com- 
pany,   agr-eed    to   itse,   arid,    while   the    \\<>i.. 


;^40 


'^VAUUANTY. 


was  i»i'(>jrn'ssiiiir.  insislcil  ropcatcdly  that  In' 
was  iisin.t,',  alt!i(»u.i,'li  lie  knew  to  the  contra ry. 
Till'  (UrCrn'iuc  hftwccn  these  two  f;i":»'h'S  is 
substaulial.  aci-ordiii.u  to  the  evidence,  both 
as  to  quahty  anl  vahie.  Kiln  run  inehich'  all 
brieks  found  in  a  kiln,  taken  a-s  they  eonie. 
while  eoniinim  are  the  bricks  reiualnin.t,' 
after  .suine  of  the  very  bes;  (inalily  iiuve 
l)e(Mi  tak(>n  out.  It  follows  that  the  coni- 
uion  iL,'rade  will  include  a  nuich  larjicr  i)er- 
centajic  of  s()fi-l)urned  bricks  than  kiln  run, 
and  that  a  wall  built  of  the  };ra(h'  first, 
nieniioned  cainint  be  as  durable,  n^r  can  it  be 
made  as  uniform  in  color,  as  wlu-u  built  of 
kiln  run.  At  any  rate.  Hood  aji'reed  to  ui>e 
the  hitler,  and  deliberately  purchased  an  in- 
ferior article.  Tlicre  was  no  evi(h'n('e  in  the 
ca.-(>.  nor  was  there  a  lindin^'  of  fact,  which 
w(»ulik  juslify  the  claim  of  counsel  that  there 
was  an  imiilii-d  warranty  that  the  bricks 
to  be  furiiislied  i)y  plaintiff  should  be  suit- 
ab!(>  for  the  use  intended  by  Hood.  The 
written  contract  was  complete  and  unam- 
bij;uous,  and  by  its  terms  plaintiff  was  to 
furnish  the  grade  af  bricks  known  as  com- 
mon, to  be  of  good  qu:ility  and  Cijual  to 
samjiie.  B(H-au.se  the  plaintiff  wa.s  in- 
fornuKl  that  th(>  bricks  were  to  be  u.sed  in 
building  a  factory  for  defendant  comp.'iiiy,' 
it  cannot  be  said  that  there  was  an  im- 
plied warranty  that  they  shf)uld  be  reason- 
ably tit  for  the  purpose.  Hood  contracted 
for,  and  plaintiff  agreed  to  fuiii'sh,  a  specitic 
ai-.ticle  of  a  well-recognized  kind  or  descri])- 
tion,  according  to  the  tinding-i.  This  article 
was  not  to  be  supplied  to  satisfy  a  required 
puiixjse.  as  was  the  fact  in  Brren  v.  Moran, 
(Minn.)  .j3  X.  W.  Rep.  75."),  cited  by  counsel. 
that  purpo.se.  and  not  any  specitic  article, 
being  the  e.sseutial  matter  of  the  contract; 
but  it  was  to  be  of  a  well-known  grade  and 
quality.      If  an  order  be  given  for  a  specilled 


article  of  a  recognized  kind  or  desciiption, 
and  the  article  is  supplietl,  th  ':-e  is  no  war- 
ranty that  it  will  answer  the  puri)Ose  de- 
scribed or  supposed,  although  Intended  and 
expected  to  do  .so.  (iould-  v.  Bropliy,  42 
Minn.  !()!>.  43  N.  W.  Kep.  834;  Leake,  Cont. 
404.  Applying  this  well-s;>ttled  and  sensible 
rule  to  this  case,  it  is  obvious  that  a  conclu- 
sion of  law  ba.sed  to  any  extent  upon  a 
liuding  of  fact  that  the  bricks  were  not  tit 
or  proper  to  be  usetl  in  th(>  erection  of  the 
buildings  cannot  be  .sustained.  Agai:i,  it  is 
((bvious  that  a  conclusion  of  law  by  \^•hicll 
the  amount  of  damages  sustained  by  the 
ri'frigerator  company  is  tixed.  solely  ana 
wholly  based  on  the  finding  of  fact  before 
mentioned, — that,  had  the  bricks  "been  of  the 
<iuality  and  kind  called  for  by  the  terms  of 
the  contract  between  plaintifl'  and  said  Hood 
and  .said  Hood  and  the  refrigerator  com- 
pany," etc.,— cannot  stand.  This  finding  as- 
sumes that  plain! iff  agreiHl  to  furnish  the 
s:ime  grade  of  bricks  that  Hood  agreed  Avith 
the  ref rigeratcjr  comi^any  to  put  into  the  walls 
of  the  factory  building,  wliicli  was  not  the 
fact,  'j'he  plaintiff  was  under  no  obliga- 
tion to  furnish  bricks  known  as  "'kiln  ran,"' 
and,  so  far  as  shown  by  the  record,  had  no 
knowledge  that  Hood  had  obligated  himself 
to  do  so.  This  finding  was  certainly  ba.setl 
on  the  presumption  that,  as  to  kind  and 
(luality  of  materials,  the  contracts  were 
alike. 

We  need  not  refer  specifically  to  any  of  the 
remaining  assignments  of  error,  for  we  are 
not  to  anticipate  the  lailings  of  the  court 
below  on  another  trial.  We  cannot  refrain 
from  remarking,  however,  that  the  delin- 
quencies of  the  defendant  Hood  in  the  per- 
formance of  the  contract  made  with  his  co- 
defi'udant  must  not  be  unloaded  onto  the 
plaintiff.     Order  reversed. 


WAUKANTY. 


341 


CARLETOX   ct   nl.    v.    LOMBARD,    AYERS 
&  CO. 

(48   X.    E.   422.) 

Court  of  Appeals  of  Xmv  York.      April  7.  1890. 

Appeal  from  supreme  court,  gen(n'al  term. 
First  department. 

Action  by  T.  Osgood  Carleton  and  another 
asaiiist  liombard.  Ayers  &  Co.,  a  corporation, 
for  alleged  breach  of  contract  to  deliver  plain- 
tiffs a  specified  (luality  and  quantity  of  ix^ro- 
leum.  From  a  jud.ijment  of  the  general  term. 
First  department  (28  X.  Y.  Snpp.  1107),  af- 
firming a  judgment  for  defendant,  plaintiffs 
appeal.     Reversed. 

James  C.  Carter,  for  appellants.  B.  F. 
Trac-y,  for  respondent. 

O'BRIEX.  J.  The  plaintiffs  sought  to  re- 
cover damages  in  this  action  for  the  breach 
of  an  executory  contract  for  the  sale  of  goods. 
The  defendant  is  a  domestic  corporation  en- 
gaged in  retining  crude  petroleum  for  sale 
and  export,  and  both  parties  to  the  action  were 
members  of  the  Xew  York  Produce  PLKchange. 
On  the  10th  of  January,  1887.  the  parties  en- 
tered into  a  contract  in  writing,  which,  by  its 
...1X..S,  was  made  subject  to  the  rules  of  the 
exchange,  whereby  the  defendant  agreed  to 
sell  and  deliver  to  the  plaintiffs  a  large  quan- 
tity of  refined  petroleum.  The  foUoAving  is 
the  material  part  of  the  contract,  in  which  the 
kind,  quantity,  and  price  of  the  goods  are 
specified,  as  also  the  time  and  place  of  deliv- 
ery, in  these  words:  "Fifty-five  thousand 
cases,  ten  i>er  cent.,  more  or  less,  each  case 
packed  with  two  of  their  patent  cans,  wltli 
low  screw  tops  or  nozzles  and  brass  label.-?, 
containing  five  gallons  each  of  refined  petrole- 
um of  their  Stella  brand,  color  standard 
white  or  better,  fire  test  76  degrees  Abel  or 
upwards,  at  eight  and  one-half  cents  per  gal- 
lon, cash  on  delivery.  To  be  delivered  .n 
yard,  free  of  expense  to  vessel;  to  be  ready  not 
earlier  than  the  twenty-fifth  January.  18.s7. 
not  later  than  the  tenth  of  February.  18S7,  witli 
twenty-five  days  to  load.  Brass  labels  one- 
half  of  one  cent  each."  It  appears  that  before* 
closing  this  contract  the  plaintiffs  had  receiv- 
ed from  the  firm  of  Graham  &  Co.,  merchants 
at  Calcutta,  British  India,  an  offer  to  purchase 
a  like  amount  of  refined  petroleum  of  the 
same  brand,  color,  test,  and  packing,  to  be 
shipiM^d  at  the  port  of  Xew  York,  not  later 
than  March  15,  1887,  for  their  account  and 
risk,  on  board  the  British  ship  Corby,  bound 
for  Calcutta.  This  offer  the  plaintiffs  accept- 
ed on  the  same  day  that  they  entered  into 
the  contract  with  the  defendant,  and  imme- 
diately after  closing  it.  On  or  before  MarcJi 
1,  1887,  the  defendant  delivered  the  oil,  pack- 
ed in  the  manner  specilied  in  the  contract, 
to  the  plaintifts,  alongside  the  Corby,  at  its 
factory  at  Bayonne.  The  delivery  by  thfc 
defendant  to  the  plaintiffs,  and  by  the  plain- 
tiffs to  their  vendees  in  Calcutta,  was  thus 
accomplished  l)y  sulistantially  the  same  act. 
I'he   rules   of   the   Produce   Exchange,    which 


>  were  made  part  of  the  contract  between  the 
I  plaintiffs  and  the  defendant,  so  far  as  ma- 
i  terial  to  the  questions  involved,  were  these: 
I  (1)  The  committee  on  petroleum  were  au- 
I  thorized  and  reiiuired  to  license  duly  quali- 
'  ficd  inyjiectrrs,  members  of  the  exchange, 
for  the  various  branches  of  that  business.  (2| 
Buyers  should  have  the  right  of  naming  the 
insix'ctor,  but  must  do  so  at  lea.st  five  da.xs 
before  the  maturity  of  the  contract.  Failing 
in  this,  the  seller  might  employ  any  regular 
•  inspector  at  the  buyer's  expense,  and  hi.s 
]  certificates  that  the  oil  is  in  conformity  with 
'  the  contract  shall  be  accepted,  (li)  When 
goods  are  delivennl  to  vessel  by  buyer's  or- 
'  ders,  the  acceptance  of  them  by  buyer's  in- 
spector shall  be  an  acknowledgment  that  the 
goods  are  in  accordance  with  the  contract. 
The  plaintiffs,  under  the  rule,  named  the  in- 
spector, who  on  March  1.  1887,  after  the  car- 
go was  loaded  on  l)oard  tlu^  Corby,  made  and 
delivered  to  them  a  certificate  in  writing 
which  certified  that  he  had  inspected  the  oil 
shipped  on  board  the  Corby,  and  .<tated  there- 
in the  brand,  color,  test,  and  gravity  of  the 
same,  which  corresponded  with  the  contract. 
The  vessel  started  upon  her  voyage.  The 
plaintiffs  paid  the  defendant  the  purchase 
price  of  the  oil,  and  then  drew  upon  the  par- 
ties in  Calcutta  to  whom  they  had  sold,  for 
the  price  as  between  them,  and  their  draft 
was  paid.  The  vessel  did  not  arrive  at  Cal- 
cutta till  some  time  in  June,  and,  when  she 
began  to  discharge  the  cargo,  it  was  found 
that  the  cans  had  become  corroded  from  the 
inside  by  some  foreign  substance  in  the  oil, 
and  so  perforated  that  they  did  not  retain  their 
contents.  A  large  part  of  the  oil  was  lost  by- 
leakage,  and  the  whole  cargo  was  pronounced 
unmerchantable,  and  finally  sold  at  Calcutta 
for  a  small  sum.  for  account  of  wliom  it  might 
concern.  When  the  c-ondition  of  the  goods 
was  discovered  by  the  consignees,  during  the 
di.scharge  of  the  cargo  from  the  ship,  the  plain- 
tiffs were  notified  hy  cable  of  the  situation 
and  the  condition  of  the  oil.  They  laid  these 
dispatches  before  the  defendant,  and  a  long^ 
correspondence  by  cable  followed,  in  which 
the  def<'ndant  participated,  and  of  all  of  which 
it  had  knowledge.  The  purpose  of  it  was  to 
ascertain  the  defect,  if  any,  in  the  oil,  and  to- 
reach  some  amicable  arrangement.  In  the 
end  all  parties  seem  to  have  become  satisfied 
that  a  large  loss  had  been  sustained,  and  the 
parties  in  Calcutta,  who  had  paid  the  plain- 
tiffs for  the  property,  called  upon  them  la 
make  good  their  contract.  The  plaintiffs  in 
turn  caKcd  upon  the  defendant  to  indemnify 
them  from  loss,  and  it  then  took  the  ground 
that  it  had,  in  all  respects,  performed  its  con- 
tract, and  was  not  lial)!e  for  the  result. 

In  July,  1888,  (Jraham  &  Co.,  in  Calcutta, 
brought  suit  in  the  supreme  c'ourt  in  New 
York,  against  the  plaintiffs,  to  recover  their 
damages.  The  complaint  in  the  action,  after 
alleging  the  legal  obligation  of  these  plaintiffs 
to  deliver  to  thein  a  merchantable  article  of 
refined  petroleum  at  the  port  of  Xew  York, 


J42 


WAUKANTi, 


fit  for  export  and  transportation  by  son,  iu  a 
sailing  vessel,  to  India,  averred  that  in  faet  it 
was  not  a  niereliantable  eoniniodity,  but  on 
the  contrary  a  very  large  portion  of  tlu>  eans 
so  shipped  conlained  ix'troleuni  inipt'i'fwtly 
relined,  eontaining  water,  acids,  and  other 
foreign  substances,  which  would,  in  the 
course  of  transportation,  corrode  the  cans, 
and  should  have  been  eliminated  therefrom 
by  proper  refinement,  and  the  presence  of 
which  rendered  the  article  shipped  unmer- 
cliantable  and  unfit  for  transportation.  There 
VN-ere  various  other  breaches  of  the  contract 
alleged,  not  material  to  state.  Notice  was  giv- 
en to  the  defendant  to  come  iu  and  defend  the 
action,  and  it  complied  with  the  notice.  It 
participated  iu  the  preparation  of  the  de- 
fense, the  production  of  proofs,  and  at  the 
trial  was  represented  by  counsel,  and  had  ev- 
ery opportimity  to  resist  the  claim.  The  jury, 
however,  rendered  a  verdict  for  the  plaintiffs 
in  the  action,  and  against  the  defendants,  who 
are  the  i)lalntiffs  here,  upon  which  a  judg- 
ment was  entered  for  nearly  ,^.")(),<X)().  The 
plaintiffs  in  this  action,  upon  the  refusal  of 
the  defendant  to  indemnify  them,  paid  this 
judgment,  and  called  upon  the  defendant  to 
reimburse  them,  and  upon  its  refusal  this  ac- 
tion was  commenced,  in  March.  1891. 

Tlie  complaint  alleges,  as  did  that  in  the 
prior  suit,  substantially,  that  the  oil  deliver- 
e<i  by  the  defendant  alongside  the  Corby,  at 
Bayonne,  was  not  in  fact  refined,  merchant- 
able petroleum,  but.  on  the  contrary,  the  cans 
contained  a  large  proportion  of  oil  imperfect- 
ly relined,  and  containing  foreign  substances, 
which  would,  iu  the  course  of  transportation, 
<-orrode  the  cans,  and  which  should  have  been 
eliminated  by  proper  relinemeut,  the  pres- 
ence of  which  rendered  the  goods  unmer- 
chantable and  unfit  for  transportation;  that 
in  conseijuence  of  this  defect  the  can.s.  with 
few  exceptions,  had  become  corroded  and  per- 
forated by  the  action  of  the  contents,  so  that 
they  w^ould  not  and  did  not  I'etain  it,  and 
hence  could  not  be  delivered,  as  an  article  of 
merchandise  or  commerce,  at  the  port  of  des- 
tination; that  these  defects  were  latent  and 
of  a  hidden  nature,  and  such  as  could  not 
have  been  discovered  by  inspection,  or  any  ex- 
amination that  was  practicable  for  the  buy- 
ers to  make  at  the  time  and  place  of  delivery. 
The  pleading  then  states  with  considerable 
detail  the  correspondence  by  cable  after  the 
arrival  of  the  Corby  at  Calcutta,  the  defend- 
ant's connection  with  it,  the  action  brought 
against  them  by  the  Grahams,  the  issues 
therein,  the  verdict  and  judgment,  and  the 
payment  of  the  same  by  the  plaintiffs,  who 
were  defendants  in  that  action.  The  action 
liaving  been  brought  to  trial,  a  verdict  was 
directed  in  favor  of  the  plaintiffs,  but  the 
judgment  was  reversed  at  the  general  term 
upon  a  construction  of  the  contract  unfavor- 
able to  the  plaintiffs,  and  upon  exceptions 
taken  at  the  trial,  and  a  new  tnal  was  order- 
ed. On  the  new  trial  the  plaintiffs'  complaint 
was  dismissed  on  the  rulings  of  the  general 


term  made  when  the  first  judgment  was  be- 
fore it  for  review.  On  the  second  appeal  that 
court  adhered  to  its  former  ruling,  and  affirm- 
ed the  judgment. 

The  property  which  was  the  subject-matter 
of  the  contract  between  the  parties  was  nor 
in  existence  at  the  time  it  was  made,  but  was 
thereafter   to  be   produced   by   refinement   of 
the  crude  material  through  a  manufacturing 
l)rocess  by  the  defendant.      It   was  therefore 
a  contract  by  a  dealer  with  a  manufacturer, 
and    is    subject    to    the    rules  -and    principles 
that  api)ly  to  executory  contracts  for  the  sale 
and   delivery  of  goods   when   the   parties  oc- 
cupy these  relations  to  each  other.     It  is  a 
conceded  fact  in  the  case  that  the  oil  deliv- 
ered by  the  defendant  to  the  plaintiffs  along- 
side the  Corby  was  of  the  kind  and  (luality 
descrllx>d  in  the  written  contract.      In  (pian- 
tity,  brand,  color,  and  fire  test,  it  correspond- 
ed with  the  terms  of  the  contract.     But  it  is 
claimed  that,  while  all  this  is  true,  yet  there 
was  a  latent  or  hidden  defect  in  the  article  so 
delivered,   the   result   of   improper  refinement 
or  manufacture,  not  discernible  upon  inspec- 
tion, which  rendered  the  oil  immerchantable, 
and  unfit  for  transportation  by  sea  in  a  sail- 
ing vessel,  and  that  this  defect  Avas  the  cause 
of  the  loss  which  the  plaintiffs  have  sustain- 
ed.    The  most  important  question  in  the  case 
is  whether  tlie  defendant,  uotwitlistanding  its 
written  contract,  is  bound  to  make  good  the 
loss,  assuming  that  it  was  caused  by  such  de- 
fect  in   the  goods.     The  general   rule  of   the 
common  law,  expressed  by  the  maxim  caveat 
emptor,  is  not  of  universal  application,  though 
the  exceptioas  are  quite  limited;    and  one  of 
them  is  the  case  of  a  manufacturer  who  sells 
goods  of  his  own  manufacture,  who,  it  is  said, 
impliedly  warrants  that  they  are  free  from 
any  lattnt  deftct  growing  out  of  the  proc  ss 
of  manufacture.     The  se.ler  in  sjch  a  cas? 
is  liable  for  any  laieut  defect  arising  from 
the   manner   in    which   the   ar  icle   is   mtLU- 
fjictiired,  or  from  the  use  of  defective  male- 
ri:ils,  the  character  of  which  he  is  sliowa  or 
is  presumed  to  have  knowledge  of.    This  rule, 
and  the  reasons  upon   wh  ch  it  res  s,  o;  i  s 
qualifications    and    limitations,    have    seldom 
been  stated  iu  the  same  form  by  courts  a-id 
wriltrs  upon  the  subject;    but  that  it  exi.  ts, 
as  a  principle  in  the  law  of  contracts,  can- 
not  be   doubted.     The    leadiig   case   in    this 
state  is  Hoe  v.   Sanborn,  21  N.  Y.  552.     The 
learned    judge    who    framtd    the    opinion    iu 
that  case,  after  stating  the  rule,  proceeds  to 
show    the  grounds  upon   which   it   re  ts.      In 
his    view,    while    this    peculiar   obligati  )n    is 
ca  Id  a  "warranty,"  f  )r  convenience,  it  does 
not  rest  upon  any  supposed  int.ntiun  of  th:> 
parties    or    agreement,    in    fact,    but    is    one 
which  the  law  raises  up  u  piinciples  foreign 
to  the  contact,  in  tl;e  interest  of  comm  rcial 
honesty  and   fair  dealing,   and   amlo;ous  to 
thrse  upon  which  vend  rs  are  held    iab  e  for 
fraud.     It   is  <iuite   difficult  to  reconcile  the 
authorities  upon  the  question,  but  it  may  be 
obs(  rved   that    they    rec.  gaize    the   piincifle 


WARRANTY. 


343 


that  in  siicb  cas-^s  tlie  seler  and  buj-er  do  not 
deal   with  eath  othtr  quite  at  arm's  length; 
that  the  seller  iwsses-cs  superior  know  ed  ,e 
en  the  sub  ect,  upon  which  the  buyer  is  pre- 
sumed to  repo-e  some  degree  of  contidente; 
and    h-t  (ommercial  hones  y  and  fair  deal  n ,' 
require  that  in  such  cases  the  seller  be  held 
bound  to  del'ver  the  article  free  from  i-ecret 
or  latent  dL>fects  which  are  aetuiUy  or  pre- 
sumpti  ely  wthin  his  Innvle'ge.     The  prin- 
ciple was  appli'  d.  in  ^  later  case  in  this  court, 
to  a  cont  act  for  the  sale  of  serds  of  a  par- 
ticnl'ir  de<cripton   by    the   grower.     It   wis 
there  slid  that,  as  the  grower  cf  seeds  must 
be  pres'imed  to  be  crgnizant  of  any  omiss  oi 
or    neglifeuce    in    cutivation    whereby    they 
were  rendered  unlit  for   use,  there  was  the 
same  reason    for   im-^lying  a    wariaity   t^  at 
they  were  n-^t  defective  fiom  improper  cuti- 
vation, as.  in  the  ca  e  of  a  sale  of  an  article 
by  a  manufacturer,  that  it  is  free  from  latent 
def -(ts.     White  :.  Mi  L  r,  71  N.  Y.  US.    The 
latest  case  tl  at  I  have  1  een  able  to  find  upon 
the  question  is  Brid^ie  Co.  v.   Hamilton.  lH) 
U.  S.  108,  3  Sup.  Ct.  .j37.     The  h  adiug  cases 
bearmg  u'  on  the  point,  both  in  this  cunty 
and    Eug.and,   are    there    reviewed,   and   the 
couit    .-tt-ued    the    prin  ip  e    in    these    words: 
-When    the    sJler    is    the    maker    or    manu- 
factuier  of  the  thiLg  s  Id.  the  fair  presump- 
tion is  that  he  understood  the  process  of  its 
manufacture,  and  was  cognizant  of  any  la- 
tent   defect    caused    by    such    process,    and 
aj-aiu^st    which    rta.-ouable    diligence    might 
have    guar..ed      Ihis    i  re.:.umi.t  on    is    justi- 
fied in  ptrt  by  the  fact  that  the  manufactuier 
or   maker,   by   his  occupation,    holds    himself 
out  as  competent  to  make  aitic  es  leascnab  y 
adapted   to   the   purpose   for   which   such   or 
similar  ai tides  are  designed.     When,  theie- 
fore,  the  buyer  has  no  opportunity  to  imspect 
the  article,  or  when,  from  the  situation,  in- 
spection is  impracticable  or  useless,  it  is  un- 
reasonable to  suppose  that  he  bcught  on  his 
own  judgment,  or  that  he  did  not  rely  on  the 
judgment  of  the  seller  as  to  latent  defects, 
of  whiih  the  latter,  if  he  us  d  due  care,  must 
have    been    informed   during    the    process   of 
manufacture.     If  the  buyer  relied,  anl,  un- 
der the  circumstances,  had  reason  to  rely,  on 
the    jtidgment    of    the    seller,    who    was   the 
mauufactu  -er  and   maker  of  the  article,  the 
law  implies  a  warranty  that  it  is  reasonab  y 
fit   for  the   use   for  which    it   was  designed, 
the  seller  at  the  time  l;ein.r  in'"ormed  of  the 
puriJose  to  devote  it  to  tl.at  use." 

The  principle  is  distinctly  admitted  in  the 
opinion  of  the  learned  court  below,  and  I  do 
not  understand  that  it  is  denied  by  the  learn- 
ed counsel  for  the  defendant.  It  is  strenuous- 
ly urged,  however,  that  it  can  have  no  appli- 
cation to  a  case  like  this,  where  the  contract 
is  in  writing,  with  such  ample  description  of 
the  goods  sold.  But  the  obligation  attached 
to  an  executory  contract  for  the  sale  of  goods 
by  the  manufacturer  or  maker  cannot  be 
changed  by  the  mere  fact  that  the  contract 
has  been  reduced  to  writing.    The  writing,  it 


is  true,  is  deemed  to  express  the  whole  agree- 
ment of  the  parties,  but  since  this  peculiar  lia- 
bility arises  from  the  nature  of  the  transac- 
tion and  the  relations  of  the  parties,  without 
express  words  or  even  actual  intention,  it  will 
remain  as  part  of  the  seller's  obligation,  un- 
less in  some  way  expressly  excluded.  All  im- 
plied warranties,  therefore,  from  their  nature, 
may  attach  to  a  written  as  well  as  an  un- 
written contract  of  sale.  The  parties  may.  of 
course,  so  contract  with  each  other  as  to 
eliminate  this  obligation  from  the  transac- 
tion entirely.  The  seller  may,  by  express  and 
unequivocal  words,  exclude  it,  and,  in  like 
manner,  the  buyer  may  waive  it.  80.  also,  the 
parties  may  provide  for  a  delivery  or  inspec- 
tion of  the  ai'ticle  when  made,  which  will 
operate  to  extinguish  the  liability  upon  ac- 
ceptance. Mcl'arlin  v.  Boyntou,  S  Hun.  449, 
and  71  N.  Y.  (HJ4.  In  this  case  the  parties  did 
provide  for  an  insijection  of  the  oil.  The 
scope  and  effect  of  that  provision  of  the  con- 
tract will  be  considered  hereafter,  but,  aside 
from  that,  there  was  no  language  used  indicat- 
ing any  intention  on  the  part  of  the  buyer  to 
waive,  or  the  seller  to  exclude,  the  liability  of 
a  manufacturer. 

The  proposition  upon  which  the  case  turned 
in  the  court  below,  and  upon  which  the  judg- 
ment is  defended  here,  was  thus  stated  by  the 
learned  judge  in  the  opinion  at  general  term: 
"It  is  well  settled  that,  when  an  article  is  sold 
under  a  contract  which  specilies  the  qualities 
which  it  shall  possess.— no  matter  whether 
the  language  be  a  condition  or  a  warranty,— 
the  law  will  not,  except  in  special  cases,  im- 
ply a  warranty  or  condition  that  the  article 
has  other  qualities.  A  waiTanty  or  condi- 
tion, in  a  contract  of  sale,  that  the  article 
sold  has  certain  qualities,  excludes  the  impli- 
cation of  a  warranty  or  condition  that  it  pos- 
sesses other  qualities."  From  the  operation 
of  this  general  proposition,  it  will  be  seen  that 
the  learned  judge  excepts  special  cases, 
which,  however,  are  not  designated.  In  its 
application  to  this  case  the  rule  thus  stated 
must  mean  that  since  the  parties  have,  in 
their  contract,  specified  the  particular  brand, 
color,  and  fire  test  of  the  refined  petroleum 
which  was  the  subject  of  the  sale,  the  manu- 
facturer's obligation  to  deliver  an  article  free 
from  latent  defects,  arising  from  the  process 
of  manufacture,  which  would  render  it  un- 
merchantable, has  been  excluded  by  implica- 
tion. This  is  not,  we  think,  the  meaning  of 
the  i-ule  to  which  the  learned  judge  referred 
in  the  language  quoted.  The  rule  means  that, 
where  parties  to  a  contract  of  sale  have  ex- 
pressed in  words  the  warranty  by  which  they 
intend  to  be  bound,  no  further  warranty  will 
be  implied  by  law,  but  that  expressed  will  in- 
clude the  whole  obligation  of  the  seller.  Benj. 
Sales,  §  660;  Deming  v.  Foster,  42  N.  H.  165. 
Moreover,  this  principle  applies  to  sales  of  spe- 
cific, existing  chattels,  and  not  ordinarily  to 
sales  of  goods  to  be  made  or  supplied  upon  the 
order  of  the  buyer.  There  is  much  confusion  in 
!   the  cases  on  this  subject,  arising,  doubtless. 


344 


WARRANTl\ 


from  an  iiiaceuiate  use  of  tlip  tprin  "war- 
rauty."  ^^■hen  an  articU'  is  sold  by  the  own- 
er or  maker  by  the  particular  (lescriptiou  by 
wbicli  it  is  known  in  the  trade,  it  is  a  condi- 
tion precedent  to  his  rij,'ht  of  action  that  the 
thini,'  which  he  has  delivered,  or  offers  to  de- 
liver, should  answer  this  description.  But  in 
many  cases  in  modern  times  the  sale  of  a  par- 
ticular thinsi:  by  terms  of  d<'scription  has  been 
treated  as  a  warranty,  and  the  breach  of  such 
a  contract  a  breach  of  warranty,  whereas  it 
would  be  more  correct  to  say  that  it  was  a 
failure  to  comply  with  the  contract  of  sale 
whiih  the  party  had  engag:ed  to  perform. 
Chanter  v.  Hopkins,  4  Mees.  &  W.*404;  Benj. 
f-'ales.  §  000.  There  are  many  cases  in  which 
such  words  of  description  are  not  consider- 
ed as  warranties  at  all,  but  conditions  preced- 
ent to  any  obli,iratiou  on  the  part  of  the  ven- 
dee, since  the  existence  of  the  qualities  indi- 
cated by  the  descriptive  words,  beiujj  part  of 
the  description  of  the  thins  sold,  becomes  es- 
sential to  its  identity,  and  the  vendee  can- 
not be  obliged  to  receive  and  pay  for  a  thing 
different  from  that  for  which  be  contracted. 
2  Smith.  Lead.  Cas.  (6th  Eng.  Ed.)  27;  2 
►Schouler,  Pers.  Prop.  pp.  352,  353.  The  tend- 
( iicy  of  the  recent  decisions  in  this  court  is  to 
treat  such  woids  as  part  of  the  contract  of  sale 
descriptive  of  the  article  sold  and  to  be  de- 
livered in  the  future,  and  not  as  constituting 
that  collateral  obligation  which  sometimes 
accompanies  a  contract  of  sale,  and  known  as 
a  "warranty."  Reed  v.  Randall.  20  N.  Y. 
358;  Iron  Co.  v.  Pope,  lOS  X.  Y.  232,  230,  15 
N.  E.  3;S5. 

It  is  liot  now  important  to  inquire  how  far, 
or  under  what  circumstances,  the  principle 
stated  by  the  learned  judge  applies  to  con- 
tracts of  sale  of  goods  in  esse  between  deal- 
ers, in  which  there  is  an  express  warranty. 
It  is  not.  we  think,  applicable  to  the  obliga- 
tion of  a  manufacturer  who  contracts,  as  in 
this  case,  for  a  sale  of  his  own  product,  the 
<-oudition  of  which  he  is  presumed  to  know. 
It  is  plain  that  in  the  case  at  bar  the  plain- 
tiffs intended  to  buy,  and  the  defendant  to 
sell,  an  article  of  refined  petroleum,  which 
slKuld  not  only  correspond  to  the  description 
in  the  contract,  but  should  be  free  from  latent 
defects  arising  from  the  process  of  manufac- 
ture, so  as  to  constitute  a  thing  which,  in  the 
commercial  sense,  wotild  be  of  some  use  or 
value.  It  is  quite  conceivable  that  the  oil 
might  correspond  with  all  the  descriptions  of 
th(?  contract,  and  yet  be  a  useless  and  un- 
merchantal)le  thing,  in  consequence  of  defects 
arising  i'nan  the  process  of  manufacture,  in 
which  case  the  buyer  would  have  the  shad- 
ow of  the  thing  bought,  without  the  sub- 
stance. The  defendant's  obligation  rests,  not 
only  upon  the  terms  of  the  contract,  but  upon 
its  .superior  knowledge  and  the  confidence 
which  the  buyer  placed  in  its  ability  to  pro- 
duce a  proper  article;  and  hence  the  rela- 
tions of  the  parties  are  quite  different  from 
that  of  dealers  in  the  article  in  the  market, 
etch  possessing  eciual  means  of  information 


and  opportunity  for  the  detection  of  latent  de- 
fects. A  stiict  adherence  to  the  bare  descrip- 
tive words  of  the  contract  would  not  express 
the  full  obligation  of  the  defendant.  That 
the  commodity  shall  be  so  free  from  latent 
defects  arising  from  the  process  of  refining, 
and  which  could  be  guarded  against  by  ordi- 
nary care,  so  as  to  render  it  merchantable,  is 
a  term  to  be  implied  in  all  such  contracts. 
Story,  Cont.  (4th  Ed.)  §§  830,  837;  .lones  v. 
Just.  L.  R.  3  Q.  B.  197.  The  plaintiffs  were 
entitled  to  something  more  than  the  mere 
semblance  or  shadow  of  the  thing  designated 
in  the  contract.  They  were  entitled  to  the 
thing  itself,  with  all  the  essential  qualities 
that  rendered  it  valuable  as  an  article  of  com- 
merce, and  free  from  such  latent  defects  as 
would  render  it  unmerchantable.  Mody  v.  Greg- 
son.  L.  R.  4  Exch.  49.  If  the  goods  in  question 
were  in  fact  unmerchantable,  in  conseriuence 
of  latent  defects  arising  from  the  process  of 
manufacture,  and  which  the  defendant  could 
have  guarded  against  by  the  exercise  of  rea- 
sonable care,  it  would  be  quite  unreaso:_able 
to  hold  that  the  defendant  has,  nevertheless, 
performed  the  contract,  because  it  has  deliv- 
ered oil  of  the  same  brand,  color,  and  test 
specified.  It  is  quite  clear  that  the  words 
of  the  written  contract  do  not  exclude  a  lia- 
bility on  the  part  of  the  defendant  for  fraud 
in  the  performance,  and  it  is  difficult  to  see 
how  it  can  affect  an  obligation  of  the  seller, 
who  is  also  a  manufacturer,  which  is  based 
upon  his  actual  or  presumed  knowledge  of 
latent  defects  in  the  oil,  arising  from  the  pro- 
cess of  refinement.  In  the  construction  of 
commercial  contracts  for  the  sale  and  deliv- 
ery of  g(X)ds,  the  courts  are  not  always  bound 
by  the  literal  meaning  of  words  descriptive 
of  the  article,  contained  in  the  contract.  It 
frequently  happens,  in  large  transactions, 
that  the  article  which  is  the  subject  of  the 
contract  is  described  by  some  vague,  generic 
word,  which,  taken  strictly  and  literally,  may 
be  satisfied  by  a  worthless  or  defective  arti- 
cle. In  such  cases  the  words  may  mean 
more  than  their  bare  definition  or  literal 
meaning  would  imply,  and  impose  upon  the 
seller  an  obligation  to  furnish,  not  only  the 
thing  mentioned  in  the  contract,  but  a  mer- 
cliantable  article  of  that  name.  Murchie  v. 
Cornell,  155  Mass.  00,  29  N.  E.  207.  If  it 
be  trtie  that  the  defendant  in  this  case  deliv- 
ered alongside  the  vessel  an  article  which 
was  unmerchantable  and  unfit  for  transporta- 
tion, in  consequence  of  hidden  latent  defects 
arising  from  the  process  of  manufacture,  and 
of  which  it  had,  or  should  have  had,  knowl- 
edge, in  the  exercise  of  reasonable  care,  it 
has  not,  in  any  just  or  substantial  sense,  per- 
formed its  contract,  although  the  article  so 
delivered  was  of  the  brand,  color,  test,  and 
specific  gravity  called  for  by  the  writing. 
The  plaintilTs  were  not  only  entitled  to  the 
thing  described,  but  to  that  thing  in  such  con- 
dition, and  so  free  from  hidden  defects,  as  to 
make  it  available  to  them  as  an  article  of 
commerce,  and  fit  for  transportation. 


WAKUA.NTY. 


345 


Y/hether  this  liability  survived  the  deliv- 
ery and  inspection  of  the  goods  remains  to 
be  considered.  When  the  rules  of  the  ex- 
change are  read  into  the  contract,  it  is  pro- 
vided that  the  acceptance  of  the  petroleum 
by  the  buyer's  inspector  shall  be  an  acknowl- 
edgment that  the  goods  ai-e  in  accordance 
with  the  contract;  and.  as  we  have  seen, 
the  inspector  so  certitied.  The  inspector  was 
not  the  agent  of  either  party,  but  an  umpire 
selected  to  determine  whether  the  article  de- 
livered alongside  the  Corby  corresponded  with 
the  contract.  The  parties,  in  effect,  submit- 
ted a  certain  question  to  the  decision  of  the 
inspector,  and  that  was  whether  the  oil  cor- 
responded, in  brand,  color,  and  fire  test,  with 
the  contract.  He  was  not  authorized  to  de- 
teriuine  whether  there  was  or  was  not  any 
hidden  or  latent  defects  in  the  article  at  the 
time  and  place  of  the  delivery  which  would 
render  it  unmerchantable.  That  question  was 
not  within  the  fair  scope  or  purpose  of  the 
inspection,  and  the  certificate  on  this  point 
does  not  conclude  the  parties.  If.  however, 
the  defects  which  the  plaintiffs  now  claim 
existed  at  the  time  of  delivery,  and  which 
they  claim  to  have  produced  the  damages, 
were  discernible  upon  the  inspection  contem- 
plated by  the  contract,  they  were  not  hid- 
den or  latent  defects,  within  the  meaning  of 
the  rule,  and  in  that  case  the  certificate 
would  conclude  the  parties.  If,  in  executing 
the  power  to  determine  the  brand,  color,  fire 
test,  and  gravity  of  the  article  delivered, 
any  other  defect  which  would  render  it  un- 
merchantable would  necessarily  appear,  the 
plaintiffs  are  concluded  as  to  that  defect  by 
the  certificate  of  the  inspector.  Studer  v. 
Bleistein.  115  N.  Y.  31(3,  22  N.  E.  243;  Pan 
Co.  V.  Remington,  41  Hun,  218.  If  I  am 
right  in  these  several  propositions,  it  must 
follow  that  the  plaiutilfs  were  entitled  to 
prove  upon  the  trial,  if  they  cotild,  that  the 
refined  petroleum  delivered  by  the  defend- 
ant alongside  the  Corby,  though  correspond- 
ing with  the  description  of  the  article  in  the 
contract,  had  in  it  some  hidden  or  latent  de- 
fect, not  discernible  by  the  inspection  provid- 
ed for,  which  then  and  there  rendered  it  un- 
merchantable. 

At  the  trial  the  plaintiffs'  counsel  offered 
in  evidence  the  judgment  roll  in  the  action 
against  them  by  Graham  &  Co.,  already  re- 
ferred to,  as  proof  upon  some  of  the  issues 
in  the  case.  He  also  offered  to  prove  what 
actually  took  place  at  that  trial,  and  what 
questions  were  actually  litigated  and  submit- 
ted to  the  jury.  The  evidence  was  objected 
to  by  the  counsel  for  the  defendant,  exclud- 
ed by  the  court,  and  the  plaintiffs'  counsel 
excepted.  We  have  seen  that  the  defendant 
had  knowledge  of  all  the  correspondence 
by  cable  between  the  plaintiffs  and  tlie  par- 
ties in  Calcutta,  that  it  Avas  notified  of  the 
commencement  of  the  action,  and  that  it  par- 
ticipated in  the  trial.  In  so  far  as  the  is- 
sues actually  litigated  in  that  case  are  iden- 
tical  with  the   issues   involved   in   this,   the 


judgment  is  binding  upon  the  defendant,  in 
the  same  way  as  if  it  had  been  a  party  upon 
the  record.  Oceanic  Steam  Nav.  Co.  v.  Com- 
pania  Transatlantica  Espanola,  144  X.  Y. 
t>t>j,  39  N.  E.  3UU;  Village  of  Port  Jervis  v. 
First  Nat.  Bank  of  Port  Jervis,  90  N.  Y. 
550;  City  of  Rochester  v.  Montgomery,  72 
N.  Y.  (J5;  Albany  City  Sav.  lust.  v.  Bur- 
dick,  87  N.  Y.  40,  45;  Andrews  v.  Gillespie,^ 
47  N.  Y.  487;  Heiser  v.  Hatch.  86  N.  Y.  014; 
Chicago  City  v.  Robbins,  2  Black,  418.  What 
the  plaintiffs  sought  to  prove  by  this  record 
was  that,  at  the  time  of  delivery  of  the 
petroleum  by  the  defendant  alongside  the 
Corby,  it  was  not  properly  refined,  but  con- 
tained water,  acid,  and  other  foreign  substan- 
ces that  rendered  it  unmerchantable,  and 
that,  in  consequence,  they  were  cast  in  dam- 
ages at  the  suit  of  the  parties  in  Calcutta, 
the  delivery  in  both  cases  being  substantially 
identical  in  point  of  time  and  the  amount 
of  the  damages.  Graham  &  Co.  could  not 
have  recovered  against  the  plaintiffs  for  any 
change  or  deterioration  in  the  oil  after  it 
was  delivered,  or  that  was  due  to  the  voy- 
age or  the  perils  of  the  sea,  since  the  goods 
were  at  their  risk.  The  plaintiffs  offered  to 
prove  that  the  recovery  did  not  proceed  upon 
the  ground  of  any  express  warranty,  or  any 
other  ground  embraced  within  the  plead- 
ings, other  than  the  unmerchantable  condi- 
tion of  the  oil  when  delivered  at  the  vessel. 
They  were  not  confined  to  the  record  in  or- 
der to  show  the  point  passed  upon,  but  could 
show  by  parol  proof  what  questions  were 
actually  litigated  and  decided.  Doty  y. 
Brown,  4  N.  Y.  71;  Kerr  v.  Hays,  35  N.  Y, 
331;  Bell  v.  Merrifield,  109  N.  Y.  211.  10  N. 
E.  55;  Adams  v.  Conover,  87  N.  Y.  429; 
Smith  V.  Smith.  79  N.  Y.  034;  1  wis  v.  Pier 
Co.,  125  N.  Y.  348,  20  N.  E.  3oi:  Shaw  v. 
Broadbeut.  129  N.  Y.  114;  i  Davis  v.  Brown, 
94  U.  S.  423;  Russell  v.  Place,  Id.  000.  It 
is  quite  true  that  the  record  would  not  prove 
that  the  defects  were  latent,  or  such  as 
would  not  be  disclosed  by  the  inspection  con- 
templated by  the  contract,  since  that  ques- 
tion was  not  involved  on  the  former  trial, 
and  the  plaintifi^s  did  not  offer  it  for  that 
purpose.  It  could  not  be  excluded,  however, 
because  it  did  not  prove  the  plaintiffs'  en- 
tii'e  ease.  If  it  proved  any  material  fact 
in  support  of  it,  it  was  admissible.  It  did, 
we  think,  establish,  as  against  the  defend- 
ant, the  fact  that  the  oil,  when  delivered 
alongside  the  Corby,  was  unmerchantable, 
since  that  was  the  ground  upon  which  the 
parties  in  Calcutta  recovered  the  damages, 
as  we  must  assume  from  the  present  con- 
dition of  the  record.  The  plaintiffs  were,  of 
course,  boimd  to  show  by  other  proof  that 
the  defects  which  rendered  the  goods  unmer- 
chantable were  latent,  and  such  as  would 
not  be  disclosed  by  the  inspection. 

The   plaintiff's   oft"ered    some   proof   at   the 
trial   tending   to   show   that  the   defendant, 

1  29  N.  E.  238. 


^4(3 


AVAKKA.NTV. 


from  tlio  manuer  in  which  the  goods  were 
pa<  k('(l.  as  well  as  from  other  sources,  knew 
the  destination  of  the  cargo  in  question,  but 
it  was  objected  to  and  excluded  under  ex- 
ception. \\"b  tliink  that  the  proof  was  ad- 
missible. It  was  a  circumstjince  surround- 
ing the  transaction,  not  conllicting  witli  the 
terms  of  the  contract,  and  miglit  have  some 
bearing  on  the  defendant's  obligation  to  de- 
liver an  article  of  rehned  petroleum  free 
from  latent  defects  that  would  render  it  un- 
merchantable, and  upon  the  degree  of  care 
tliat  it  was  bound  to  use  to  that  end.  One 
of  tlie  (pialities  which  the  oil  in  question 
should  pos.sess  was  44  degrees  Beaume,  sjie- 
citic  gravity.  This  was  introduced  into  the 
contract  by  the  adoption  of  the  rules  of  the 
exchange.  It  is  quite  possible  that  an  article 
of  commerce,  such  as  petroleum,  possessing 
all  the  qualities  and  sustaining  all  the  tests 
specified  in  this  contract,  may  be  a  mer- 
chantable commodity,  according  to  the  cus- 
tom of  the  trade,  irrespective  of  any  other 
consideration,  or  of  any  latent  defect.  But 
that  proposition  is  one  of  fact,  rather  than 
law;  and,  if  true,  it  is  difficult  to  see  how  a 
recovery  could  have  been  had,  upon  the 
grounds  stated,  by  the  parties  in  Calcutta. 
The  defendant,  having  had  an  opportunity 


to  litigate  that  question  once,  may  be  bound 
by  tlie  result;  but  in  any  event  it  cannot 
be  atfirmed,  as  matter  of  law,  upon  the  evi- 
dence in  the  record,  that  the  article  deliv- 
ered was  merchantable. 

Our  conclusions  with  respect  to  the  ques- 
tions in  the  case  may  be  briefly  summarized: 
(1)  The  defendant  was  bound  to  deliver  an 
article  of  relined  petroleum  that  was  free 
from  latent  or  hidden  defects  that  rendered 
it  unmerchantable  at  the  time  and  place  of 
delivery,  and  that  could  have  been  avoided 
or  guarded  against  in  the  prcjcess  of  reline- 
ment,  or  in  the  selection  of  the  raw  mate- 
rial, by  reasonable  care  and  skill.  (2)  This 
obligation  survived  the  acceptance,  if  the 
latent  defects  were  such  as  would  not  ap- 
pear upon  an  inspection  to  ascertain  whether 
the  oil  delivered  corresponded  with  that  de- 
scribed in  the  contract.  (3)  The  judgment 
i-oll  in  the  former  action  was  admissible  in 
evidence  for  the  purpose  and  upon  the 
ground  already  stated.  (4)  The  plaintiffs 
were  entitled  to  show  that  the  defendant 
knew  the  destination  of  the  cargo  of  oil  des- 
ignated in  the  contract.  The  judgment  musit 
therefore  be  reversed,  and  a  new  trial  grant- 
ed; costs  to  abide  the  event.  All  concur. 
Judgment  reversed. 


WAKUANTY. 


347 


CKAFT  V.   PAKKEK.  WEBB  &   CO. 

(55  N.  AV.  S12,  <M  Mich.  245.) 

Supreme  Court  of  Michijiiui.     June  30,  1893. 

Error  to  circuit  court,  Wayne  county; 
IJeorge   S.  Hosmer,   Judge. 

Action  by  Ezra  Craft  against  I'arlcer,  N\'ebl) 
&  Co.,  a  corporation,  for  negligence  in  selling 
spoiled  meat  which  made  plaintiff  sick. 
Judgment  for  defendant,  and  plaintiff  ap- 
peals.    Reversed. 

Sloman,  Moore  &  Duffle,  for  appellant. 
Willard  M.  IJllibridge.  for  appelU-e. 

LONG,  J.  Plaintiff  brought  suit  in  an  ac- 
tion on  the  case  for  negligence  in  selling  a 
piece  of  rolled  spiced  bacon,  which  he  al- 
leges was  spoiled,  and  tuiht  for  food,  and 
from  the  effects  of  which  he  became  sick. 
The  court  below  directed  verdict  in  favor  of 
di'fendants,  on  the  grotind  that  there  was  no 
negligence  shown  on  the  part  of  the  defend- 
ants, and  also  that  the  plaiutiff  was  guilty  of 
contributory  negligence. 

We  think  the  case  should  have  gone  to  the 
jury.  Defendants  carry  on  a  wholesale  and 
retail  business  of  selling  meats  in  the  city 
of  Detroit.  On  July  S,  1S!)1,  plaintiffs  broth- 
er bought  from  them,  at  the  retail  counter, 
a  roll  of  spiced  bacon.  It  was  taken  to  the 
I)laintilT's  liouse.  wliere  he  boarded,  and  part 
of  it  rooked  for  breakfast.  Plaintiff's  brother 
had  the  firet  slice,  which  seemed  to  be  all 
right.  Later  in  the  morning,  plaintiff's  wife 
cut  oft*  some  more  from  the  roll,  and  cooked 
it  for  plaintiff".  The  wife  noticed  a  peculiar 
odor  from  it.  but  claims  she  thought  it  was 
the  spices.  Plaintiff  also  noticed  the  odor, 
and  a  peculiar  taste,  and  claims  that  he  also 
thought  it  was  the  spices.  Soon  after  eating 
it  he  became  quite  sick.  He  sent  for  a  phy- 
sician, who  prouotmced  that  he  was  suffering 
from  some  kind  of  poison.  Plaintiff  tlieii  ev 
amined  the'balance  of  the  meat,  opened  it, 
and  says  that  it  was  very  rank,  and  the  smell 
of  it  was  like  that  of  a  carcass.  A  witness 
for  plaintiff"  also  testitied  tliat  a  short  time 
previotis  to  that  she  ptirchased  some  spiced 
bacon  of  defendants,  coolced  it.  and  her  hus- 
btmd  became  sick.  She  opened  that  roll,  and 
found  it  spoiled.  She  returned  it  to  one  of 
the  clerks  at  the  retail  counter,  and  told  him 
of  its  condition.  He  took  it  back,  and  gave 
her  other  meat  in  its  place.  John  Stabler,  a 
witness  for  plaintiff,  testified  tliat  he  had 
worked  for  defendants,  but  left  their  (>mploy 
.iust  before  this  meat  was  sold.  He  testified 
that  he  had  seen  old  pickle  drippings  from 
the  upper  floor  ui)on  bacon  jiiled  upon  a 
lower  floor,  and  that  defendants'  fonnnan 
had  the  bacon  removed;    that  some  rolls  of 


bacon  were  badly  molded,  and  the  foreman 
directed    that   they   should   be   taken  to   the 
smokehouse,  and  smoked  over  agam.     Robert 
Craft,  a  brother  of  the  plaintiff,  had  worked 
for  defendants,  and  was  in    heir  employ  at 
the  time  the  bacon  was  sold  to  plaintiff.     He 
was   asked:    "Do   you  know    of  any   spoiled 
meats  that  were  sold  there,  over  the  counter, 
during   the   month   of  Jidy.   about    the  time 
you  procured  this  piece  of  spiced  bacon  that 
was  put  on  the  counter  there  for  sale  for 
private   consmuption.   in   the   regular   course 
of  their  business,  and  that  was  unfit  for  food, 
being  spoiled     and    discolored"/"     Under   de- 
fendants' objection,  the  witness  was  not  per- 
mitted   to    answer.     John  Stabler  was  also 
asked:    "What  can  you  say  as  to  whether  or 
not   you   have  seen   meat   that   was  spoiled, 
and  unfit  for  use,  prepared  in  this  place  to 
be  sold  on  the  market  about  last  sununer,  or 
tlu'   early   part    of  last    winter "f     This    was 
also  rtfled  out.     The  answers  to  these  ques- 
tions should  have  been  permitted.     The  (pies- 
tion  to  Mr.  Craft  fi.\ed  the  time  the  sale  was 
made  to  plaintiff",  and,  with  some  testimony 
fixing  the  keeping  for  sale  of  spoiled  meats 
at  about  that  time,  the  plaintiff  should  have 
been  pernutted  to  show  other  meat  kept  for 
sale  prior  to  that  time.     The  defendants  were 
keepers  of  a  retail  meat  market,  engaged  in 
the  business  of  selling  meats  for  food,  and 
were  bouiul  to  use  due  care  to  see  that  the 
meats    were    fit    for    human    consumption. 
Hoover  v.  Peters,  18  Mich.  51.     It  was  pro- 
posed to  be  shown,  however,  that  they  were 
not  only  careless  in  preparing   their   meats, 
but  their  servants  had  actual  knowledge  of 
the  unfitness  of  the  meat  for  food,  and  yet 
sold  it. 

It  was  a  question  for  the  jury  whether  the 
defendants  were  so  careless  that  they  should 
be  held  responsible  for  the  consequences  of 
their  own  acts,  or  the  acts  of  their  servants. 
A  dealer  who  sells  food  for  consumption  im- 
pliedly warrants  that  it  is  lit  for  the  purpose 
for  Avhich  it  is  sold.  If,  in  addition  to  this 
implied  warranty,  it  is  found  that  he  was 
negligent  in  selling  meats  that  were  danger- 
ous to  those  who  ate  them,  he  would  be 
liable  for  the  consequences  of  his  act,  if  he 
knew  it  to  be  dangerous,  or,  by  propi>r  care 
on  his  part,  could  have  known  its  couditiim. 
Bishop  V.  Weber,  139  Mass.  411,  1  N.  E.  Uep- 
154.  These  are  questions  for  the  jury,  and 
not  for  the  court. 

The  question  is  also  for  the  jury  to  deier- 
mine,  whether  the  plaintiff  exercised  due 
care  on  his  part  in  partaking  of  the  meat 
when  he  observed  the  odors  arising  from  it 
after  it  was  cooked.  The  judgment  must  be 
reversed,  and  a  new  trial  ordered.  The 
other  justices  concurred. 


348 


AVAUUAXTY. 


LEITCH   V.    (UlA.ETl'K   UVAi'/AHi 
MANT'F'G   CO. 

((iT  X.  w.  .sr>2.) 

Supnui.'   Court    of    MiiUH>sot;i.      Miiy    10.    lSl»(i. 

Appeal  from  luunicipul  court  of  Minne- 
apolis; Audrow  Holt,  Jndse- 

Action  by  tJcorj^'e  T.  Leitcli,  doinjj  husinoHS 
as  tho  Malloablf  Iron  Works,  af;:ainst  the  CJil- 
letle-Herzoj;  Manufacturing  Company.  ,Tudg- 
meut  for  plaintiff.  From  au  order  denying  a 
new  trial,  defendant  appeals.    Reyersed. 

Booth  &  Douglas,  for  appellant,  .las.  D. 
Shearer,  for  respondent. 

START.  C.  J.  This  was  an  action  to  re- 
cover a  balance  of  .i;443.1()  of  the  contract 
price  of  .')0U  iron  bedsteads  manufactured  by 
the  pkiiutiff  for  the  defendant.  The  con- 
tract, as  the  trial  court  found  it,  was  that 
the  plaintiff  agreed  to  manufacture  for  the 
defendant  .MO  iron  bedsteads,  for  which  the 
defendant  agreed  to  pay  the  plaintiff  .?5.G0 
each.  It  was  expressly  agreed  by  the  par- 
ties that  such  beds  should  be  in  accordance 
with  a  certain  sample  bed  then  furnished  by 
the  defendant  to  the  plaintiff,  except  as  to 
certain  additions  and  changes  not  here  ma- 
terial. It  v»-as  also  agreed  that  the  beds 
should  be  inspected  and  approved  by  defend- 
ant, at  plaintiff's  factoiy,  before  the  same 
were  loaded  on  the  cars.  The  defendant,  by 
its  answer,  admitted  the  making  of  this  con- 
tract, but  further  alleged,  by  way  of  a  coun- 
terclaim, that  the  plaintiff  specially  war- 
ranted that  the  beds  so  to  be  manufactured 
by  iv  should  be  like  the  sample  furnished  (ex- 
cept as  to  the  stipulated  changes),  and  war- 
ranted that,  if  one  of  the  beds  would  g.)  to- 
gether, they  all  would,— that  is,  that  the  sev- 
eral parts  of  the  beds  were  interchangeable; 
that  the  beds  were  inspected  at  the  pl.iin- 
tiff's  factory,  and  appeared  and  seemed  to  be 
in  accordance  with  the  contract  in  all  re- 
spects, and  that,  relying  on  the  plaintiffs 
statement  that  the  beds  and  parts  thereof 
were  interchangeable,  the  defendant  accept- 
ed the  beds,  and  shipped  them  to  New  Or- 
leans, to  till  a  contract  it  there  had  for  beds; 
that  the  beds  were  not  constructed  in  accord- 
ance with  the  sample  bed  or  the  contract; 
that  the  defects  were  latent,  and  not  possible 
of  discovery,  except  by  putting  together  each 
and  evei-y  one  of  the  iK^ds;  that  on  discov- 
ering the  defects,  after  the  beds  arrived  in 
New  Orleans,  the  defendant  notified  the 
plaintiff  of  the  defects  in  the  beds;  that  the 
beds  as  manufactured  were  of  no  value.  The 
reply  put  in  issue  the  new  matter  alleged  in 
the  answer,  and  atlirmatively  alleged  that 
the  beds  were  in  fact  made  in  every  way  ac- 
cording to  the  contract.  The  trial  court 
made  its  findings  of  fact,  and  directed  .iudg- 
ment  for  the  plaintiff"  for  the  full  amount 
claimed.  The  defendant  appealed  from  an 
order  denying  its  motion  for  a  new  trial. 
The  findings  of  the  trial  court  as  to  the 


defects  in  the  beds,  and  wherein  they  differ- 
ed from   the  sample  beds,  the   inspection  of 
the  beds  by  the  defendant,  and  its  damages, 
are    in   these    words:      "That   plaintiff"    made 
said    beds,    especially    the    male    and    female 
castings  thereon,  from  the  same  pattern,  and 
with  the  intention  that  any  one  of  the  male 
castings  on  the  bed  rails  should  go  into  and 
fit  any  one  of  the  female  castings  on  the  bed 
posts,  or,  in  other  words,  be  interchangeable, 
and  had  also  stated  to  defendant,  but  1  do 
not  find  that  he  made  any  special  warranty 
to  that  effect  to  defendant.     That  said  b-ds, 
when   inspected   at   plaintiff's   works,   at    St. 
Louis    Park,    by    defendant,    appeared    and 
seemed  to  be  like  the  sample  beds,  referred 
to  in  the  pleadings;    but  that  when  said  beds 
arrived  at  New  Orleans,  and   defendant  at- 
temi)ted  to  put  them  together,   it  was  found 
that  the  male  castings  were  too  large  for  the 
female  castings,  and  that  the  braces  were  of 
unequal  length,  and  would  not  fit.     That  in 
more  than  four  hundred  of  said  five  hundred 
beds  said  castings  did  not  go  together,  and  de- 
fendant had  to  exjiend  large  smns  of  money 
in  remedying  said  defects;    and  that,  by  rea- 
son  of  said   defects,   said   beds   were    worlli 
more  than   seven   hundred   and  fifty   doUai's 
less  than  if  said  beds  had  been  of  the  same 
kind  as  the  sami)le  bed  in  said  fespect,  and 
said  defects  had  not  existed.     That  defend- 
ant's  agent,   in    inspecting  said   beds,    when 
delivered  to  defendant  on  board  the  cars  at 
St.   Louis   Park,   only   set  up   one   or   two   of 
said    beds.     That    if    he    had    inspected    the 
beds   prop«n-lj'.  and   tried   some   more  of   the 
castings  and  braces,  he  could  not  have  avoid- 
ed   discovering    the    defects.     That    plaintiff 
did  not  in  ;vuy  way  mislead  or  dissuade  de- 
fendant's agent  fr<!m  making  a  thorough  in- 
spection of  the  beds,  and  did  not  know  of  th(! 
said   defects.      That   plaintiff,    when   notified 
of  the  defects,  refused  to  remedy  the  same." 
The  defendant  assigns  as  error.- among  oth- 
ers, that  the  court  erred  in  finding  that  the 
plaintiff'  did  not  specially  warrant   that   the 
parts  of  the  beds  were  interchangeable;    in 
finding   that,    if  defendant  had  properly   in- 
rpected  the  beds,  it  could  have  discovered  the 
defects  in  the  beds;    and  in  finding,  as  a  con- 
clusion of  law.  that  the  plaintiff"  was  entitled 
to  judgment  for  the  full  amount  of  his  claim. 
It  is  not  material  in  this  case  whether  the 
plaintiff   specially   warranted  that  the  parts 
of  the  beds  were  interchangeable  or  not,  for 
it  was  the  express  contract  of  the  parties  that 
the  beds  should  be  like  the  sample  bed;    and 
if  they  were  not  like  it.  as  to  all  substantial 
matters,  not  otherwise  stipulated  in  the  cun- 
tract,   there  was  a  breach  of  the  plaintiff's 
contract,  and  the  defendant  is  entitled  to  re- 
cover damages  on  account  of  the  breach,  un- 
less   it   waived    it  by   an   acceptance  of   the 
beds. 

The  undisputed  evidence  shows,  and  such 
is  substantially  the  finding  of  the  court,  that 
the  plaintiff  expressly  agreed  to  manufacture 
for  the  defendant  500  iron  beds,  to  be  eciual 


WAURA.N  TV. 


349 


to  the  saniple  furnished,  in  all  respects,  ex- 
cept as  to  tlie  chanfj:es  ah-eady  i-eferred  to. 
This  is  a  warranty  that  the  beds  shoiihl  be 
like  the  sample  one,  for  it  is  just  what  the 
plaintiff  expressly  agreed  that  he  wotild  do. 
It  is  not  necessary  that  the  word  "warrant" 
should  be  used  in  order  to  create  an  express 
warranty  It  is  enough  if  the  words  actually 
used  import  an  undertaking  tliat  the  subject- 
matter  of  the  sale  shall  be  as  represented. 
Here  the  express  undertaking  was  that  the 
subject-matter  of  the  contract  should  be  like 
the  sample.  But  this  was  not  the  entire 
contract,  for  it  was  further  agreed  that  the 
beds  should  be  inspected  and  approved  by 
defendant  at  plaintiff's  factory,  before  they 
were  placed  on  the  cars.  It  is  claimed  by 
the  plaintilT  that  this  last  provision  so  quali- 
ties his  undertaking  that  the  beds  should  be 
like  the  sample  that  no  claim  for  a  Ijreach 
of  the  undertaking  or  warranty  would  sur- 
vive an  inspection  and  approval  of  the  beds 
by  the  defendant.  On  the  other  hand,  the 
defendant  claims  that  the  stipulation  in  the 
contract  as  to  inspection  and  approval  was 
for  its  benefit,  and  was  intended  to  give  it 
the  right  of  protecting  itself  both  by  war- 
ranty and  an  inspection:  that  the  right  to 
inspect  the  beds  before  acceptance  was  sim- 
ply a  cumulative  remedy.  If  this  is  a  cor- 
rect construction  of  the  contract,  it  would 
follow  that  the  defendant  might  accept  the 
bedsteads,  and  rely  on  the  warranty.  Brigg 
V.  Hilton,  99  N.  Y.  517.  3  N.  E.  51.  But  the 
contract  cannot  be  so  construed,  for  the 
agreement  that  the  beds  should  be  inspected 
and  approved  by  the  defendant  at  the  fac- 
tory was  for  the  benefit  of  both  parties,  and 
was  of  special  importance  to  the  plaintiff; 
for  if  it  was  found,  on  such  inspection,  that 
the  beds  in  any  respect  were  not  like  the 
sample  one,  the  defects  could  be  remedied 
with  less  expense  and  loss  to  the  plaintiff 
than  could  be  done  after  the  beds  were  ac- 
cepted and  shipped  away  by  the  defendant. 
After  an  inspection  and  approval  of  the  beds 
by  the  defendant,  its  right  to  recover  dam- 
ages for  the  breach  of  plaintiff's  warranty 
was  limited  to  such  defects  not  existing  in 
the  sample  as  were  not  apparent  upon  a  rea- 
sonable inspection  of  the  beds.  The  evidence 
as  to  whether  the  parts  of  the  sample  beds 
were  interchangeable  is  somewhat  conflict- 
ing, but  there  is  no  claim  that  the  different 
parts  of  the  sami)le  did  not  fit  and  go  to- 
gether, and  the  trial  court  found  that  the  de- 
fects which  it  foimd  to  exist  in  the  plain- 
tiff's beds  did  not  exist  in  the  sample  bed. 
The  defects  in  the  beds  found  by  the  court 
resulted  from  the  fact  that  the  sevei-al  parts 
of  the  beds  were  not  interchangeal)le,  and, 
as  a  consequence,  in  more  than  400  of  the 
500  beds  the  eastings  would  not  go  together; 
and  for  this  reason  the  beds  were  worth,  as 
the  court  found,  $750  lesj  than  if  the  beds 


had    been   of  tlie   same   Ivind   as   the  sample 
bed,  and  the  delects  had  not  existed. 

It  is  evident  tliat  the  trial  court's  conclu- 
sion of  law  tliat  the  plaintiff  was  entitled  to 
recover  the  entire  balance  of  the  contract 
price,  without  any  deductions  for  the  dam- 
ages which  the  defendant  had  sustained, 
was  based  on  its  finding  of  fact  that  the 
defects  in  the  beds  were  obvious  upon  a  rea- 
sonable inspection.  The  defendant  was  only 
bound  to  malie  a  reasonable  inspection  of 
the  beds.  What  is  reasonable  in  a  given 
case  depends  upon  its  particular  circum- 
stances, and  in  tliis  case  we  are  of  the  opin- 
ion tliat  the  evidence  shows  that  the  defend- 
ant made  a  reasonable  inspection  of  the 
beds,  and  that  the  finding  of  the  trial  court 
to  the  effect  that,  if  it  had  properly  inspected 
the  beds,  the  defects  would  have  been  dis- 
covered, is  not  sustained  by  the  evidence.  It 
is  true  that  if  the  defendant  had  set  up,  or 
attempted  to  do  so,  the  whole  .%0  beds,  it 
would  have  found  that  400  of  them  were 
misfits  (if  they  were  so  in  fact),  and  might 
nave  rejected  the  defective  ones.  It  is  also 
true  that  the  defendant  might  have  discov- 
ered tliat  the  parts  of  the  beds  were  not  in- 
terchangeable by  trying  to  set  up  a  very 
much  less  number  of  the  beds.  This  is  ap- 
parent from  the  defendant's  own  evidence. 
But  the  question  is  whether  the  defendant 
was  Iwttnd.  under  the  special  circumstances 
of  this  case,  to  do  more  than  it  did  in  order 
to  discover  whether  the  different  parts  of 
the  beds  would  go  togethar.  It  appears  from 
the  evidence  that  each  bed  consisted  of  13 
separate  parts,  and  there  were  to  be  manu- 
factured 500  beds  exactly  alike.  Now,  the 
fact  (which  is  so  well  known  that  we  mny 
take  notice  of  it)  that  manufacturers  in  such 
cases  make  the  several  parts  of  the  articles 
or  machines  to  be  manufacturetl  duplicates 
of  each  other,  or  interchangeable;  the  ad- 
mitted fact  that  the  plaintiff  told  the  defend- 
ant's inspector  that,  if  one  of  the  beds  went 
together,  they  would  aU  go  together;  and 
the  further  fact  that  he  did  set  up  one  or 
more  beds,  and  found  that  the  parts  went 
together  properly,— do  not  justify  a  finding 
that  he  did  not  make  a  proper  inspection. 
The  inspector  having  applied  the  test  sug- 
gested by  the  manufacturer,  who  was  botind 
to  know  whether  the  several  parts  were  in- 
terchangeable, if  he  said  anything  about  the 
matter,  and  found  that  the  parts  and  cast- 
ings fitted  in  one  bed,  he  had  a  right  to  rely 
on  the  plaintiff's  statement  that  all  of  the 
beds  would  go  together  in  the  same  way,  or, 
in  other  words,  that  the  several  parts  were 
interchangeable.  He  was  not,  therefore, 
bound  to  further  examine  and  experiment 
with  the  (5,5(X)  parts  of  which  the  beds  were 
composed,  to  ascertain  if  all  the  beds  would 
go  together.  Order  reversed,  and  a  new 
trial  granted. 


o50 


A\'AUKAXTY. 


BKADFORD  v.  MANIA'. 

(13  Mass.  13t).) 

Supreme  Judicial   Court  of  Massachuselts. 
Suffolk.    March  Torm,  181(). 

Assumpsit  on  clivers  special  coiuits,  to  recov- 
er the  difference  in  value  between  two  casks  of 
cloves,  alleged  to  be  sold  by  sample  to  the  plain- 
tiff, and  the  cloves  actually  delivered  in  virtue 
of  the  sale.  At  the  trial,  whic-h  was  had  on 
the  <feneral  issue,  before  tlie  cliief  Justice,  at  the 
last  November  term  in  this  county,  tlie  plaintitf 
produced  a  l)ill  of  parcels  of  002  pounds  of  cloves 
at  ouo  dollar  tifty  cents  per  pound,  on  which 
payment  was  acliuowledged  by  the  defendant 
to  have  been  received  in  the  plaintiff's  note 
payable  in  sixty  days.  He  then  produced  a 
witness,  who  testified  that  on  the  4tli  of  .lan- 
uaiy,  IS14,  the  defendant  came  to  the  iilaintilT's 
.>;tore,  with  a  sample  of  cloves  in  a  paper,  and 
asked  the  plaintiff  if  he  wished  to  purchase 
.some  cloves.  The  witness  examined  the  sam- 
ple, and  found  the  cloves  to  be  of  the  best 
(luality  of  Cayenne  cloves;  and  the  defendant 
said,  at  a  subsequent  time,  that  the  sample  he 
sliowed  was  of  fair  cloves.  On  the  same  day 
rliat  the  purchase  was  made  and  the  bill  of 
parcels  given,  the  casks  were  removed  to  the 
plaintiff's  store,  the  price  being  that  of  cloves 
of  the  best  quality. 

It  was  in  evidence,  that  the  sample  was  not 
taken  from  the  casks  sold,  but  from  an  open 
bairel.  out  of  which  those  casks  had  been  filled, 
llicv  not  being  before  quite  full:  but  tlie  de- 
fendant did  not  know  from  whence  the  sample 
cauje.  The  market  price  of  this  article  having 
fallen  immediately  after  the  sale,  the  plaintiff 
made  no  attempt  to  sell  the  cloves;  and  the 
casks  were  not  opened,  until  May,  181.5,  when 
there  being  some  application  for  the  purchase 
of  them,  they  were  opened,  and  were  fomid 
lo  contain  a  mixtiue  of  Cayenne  cloves  and  an 
inferior  and  distinct  species  of  the  same  article, 
the  gro\A-th  of  the  East  Indies,  in  the  propor- 
tion of  one-third  of  the  latter,  which  was  worth 
from  a  fifth  to  a  quarter  less  than  the  former. 
Whether  the  casks  had  been  opened,  or  exposed, 
or  mixed,  while  in  possession  of  the  plaintiff, 
wei-e  questions  duly  submitted  to  the  jury.  Be- 
fore instituting  this  su't,  and  after  the  defect 
was  discovered,  the  plaintiff  offered  to  return 
the  cloves,  but  the  offer  was  not  accepted.  The 
defendant  objected  to  the  admission  of  any  evi- 
dence, other  than  the  bill  of  parcels,  (which  was 
of  cloves  generally  without  designating  the 
kind.)  to  prove  that  any  distinct  species  or  quali- 
ty of  the  ai-ticle  was  sold.  But  the  objection 
was  overruled,  and  the  jury  were  instructed 
that,  although  no  fraud  was  proved  or  sug- 
gested, and  no  ex]ness  warranty,  other  than 
what  might  be  inferred  from  the  exhibition  of 
the  sample,  was  proved;  yet  if  they  believed 
from  the  evidence,  that  the  purchase  was  mad-- 
upon  the  confidence  that  the  whole  quantity  was 
represented  by  the  sample:  and  that  it  was 
the  intention  of  the  defendant  so  to  rei^resent 
by  exhil)iting  the  sample;  and  that  the  article, 
when  sold  and  delivered,  was  uiiiterially  differ- 


ent in  quality  and  value  from  that  wliich  was 
shown  in  tlie  sample;  they  ought  to  find  a  ver- 
dict for  the  plaintifT,  and  assess  in  damages  the 
difference  in  value  at  the  time  of  tlie  sale. 
The  juiy  returned  a  verdict  for  the  plaintiff, 
having  found  the  facts  specially  as  above  stated, 
and  having  also  found  that  there  Avas  no  fraud 
in  the  sale  on  tlie  part  of  the  defendant.  The 
defendant  excepted  against  the  direction  of  the 
judge,  and  moved  for  a  new  trial  on  that 
ground,  and  also  on  account  of  the  admission  of 
parol  evidence  to  prove  the  contract. 

Davis,  Sol.  Gen.,  and  Thatcher,  for  plaintiff. 
Shaw,  for  defendant. 

PARKER.  C.  J.,  delivered  the  opinion  of 
the  court.  The  first  point  taken  by  the  defend- 
ant's counsel  is,  tliat  parol  evidence  was  adrtiit- 
ted.  to  control  or  explain  the  contract  in  writing, 
whicii  .subsisted  between  the  parties. 

The  objection  goes  upon  the  supposition  that 
a  common  bill  of  parcels,  given  upon  or  after- 
the  purchase  of  goods,  is  evidence,  and  the  only 
proper  evidence  of  sucn  a  contract.  But  it  is 
not  .so.  The  bargain  is  usually  made  verbally, 
and  without  any  intention  that  it  shall  be  put 
in  writing:  and  the  bill  of  parcels  is  intended 
only  to  show  that  the  goods  have  been  pur- 
cliased  and  paid  for.  It  is  seldom  particular,  or 
descriptive  of  the  whole  contract  between  the 
parties.  But  if  it  were  not  so,  the  paper  intro- 
duced in  this  case  is  ambiguous  with  respect 
to  the  subject  of  the  bargain;  and  the  amlii- 
guit>'  is  latent,  so  that  parol  evidence  may  be 
admitted  to  exjilain  it.  It  states  only  that  "2 
casks  of  cloves"  were  purchased:  leaving  it  un- 
certain what  kind  of  cloves,  of  which  it  ap- 
pears in  the  case  that  there  are  at  least  two 
kinds,  differing  materially  in  quality  and  value. 
We  think  tliis  objection  was  projierly  over- 
ruled. 

We  may  then  come  to  the  principal  question. 
viz.  ^Mletller  the  evidence  in  the  cause  proved 
a  contract  to  sell  cloves  of  a  dift'erent  Icind 
from  those  whicli  were  delivered.  The  defend- 
ant exhibited  a  .sample,  by  which  the  plaintiff' 
pm'chased.  Among  fair  dealers  there  could  be 
no  question  but  the  vnidor  intended  to  repre- 
sent that  the  article  sold  was  like  the  sample 
exhibited:  and  it  would  be  to  be  lamented,  if 
the  law  should  refuse  its  aid  to  the  party,  who 
liad  been  deceived  in  a  purchase  so  made. 

The  objection  is,  that  no  action  upon  a  war- 
ranty can  be  maintained,  unless  the  wairantj' 
is  express;  and  that  no  other  action  can  be 
maintained,  unless  there  be  a  false  affirmation 
respecting  the  quality  of  the  article.  If  such 
were  the  law,  it  would  veiy  much  embanass 
the  operations  of  trade,  Avhich  are  frequently 
carried  on  to  a  large  amount  bj'  samples  of  the 
articles  bought  and  sold. 

The  authorities  cited  by  the  defendant's  coun- 
sel liave  been  carefully  looked  into;  and  we 
think  they  do  not  militate  with  this  decision: 
unless  it  be  the  case  of  the  bezoar  stone 
(Chandelor  v.  TiOpus,  Cro.  Jac.  4,  Dyer.  lo). 
which  we  think  would  not  now  be  received  as- 


"WARRANTY. 


S5I 


law  in  England:  certainly  not  in  our  oountiy. 
The  vendor  sold  the  stone  as  and  for  a  bezoar 
stone,  to  one  unacquainted  with  such  articles, 
and  it  turned  out  to  be  of  inferior  value.  The 
court  held  that  no  action  would  lie;  and  some 
of  the  judsres  stated  that  even  if  the  vendor 
had  known  that  it  was  not  a  liezoar,  and  it 
had  been  so  alleged,  an  action  could  not  J^e 
maintained  without  an  express  warrautj-.  The 
other  case  is  that  of  Parkinson  v.  Lee.  2  East, 
:^14.  There  tlie  hops  sold  were  of  the  same 
kind  and  (luality  as  the  sample:  but  there  was 
an  imkuowu  deterioration  by  fermentation, 
caused  by  the  jn-ower  of  the  hops,  and  not  by 
the  vendor.  Hops  being  usually  sold  in  pock- 
ets, and  tho  qualirj-  ascertained  by  sample,  it 
was  held  that  the  innocent  vendor  was  not  re- 
sponsible to  the  vendee,  for  an  unloiown  in- 
herent defect,  without  an  express  warranty. 
That  case  does  not  militate  with  our  opinion 
in  the  case  at  bar. 

The  fair  import  of  the  exhibition  of  a  sample 
is,  that  the  article  proposed  to  be  sold  is  like 
that  which  is  shown  as  a  parcel  of  the  article; 
it  is  intended  to  save  the  purchaser  the  trouble 
of  examining  the  whole  quantity.  It  certainly 
means  as  much  as  this.  "The  thing  I  offer  to 
sell  is  of  the  same  kind,  and  essentially  of  the 
same  quality,  as  the  specimen  I  give  you."  I 
do  not  know  that  it  would  be  going  too  far  to 
.say  that  it  amounts  to  a  declaration,  that  it  is 
etiually  sound  and  good.  But  it  is  not  neces- 
sary to  go  so  far  in  the  present  case;  and  we 
are  not  disposed  to  question  the  coiTectness  of 
the  decision  in  Parkinson  v.  Lee. 

It  is  expressly  foimd  by  the  jury  in  the  case 
at  bar.  that  the  cloves  delivered  were  different 
in  kind  from  those  which  composed  the  sample, 
and  inferior  in  valtie.  not  from  decay  or  ex- 
posure; but  that  ihere  is  a  specific  difference 
in  the  respective  plants  from  which  they  are 
produced.  Siu'ely  if  a  man  were  to  exhibit  to 
me  a  parcel  of  hyson  toa  as  a  sjimple.  to  indtice 
me  to  buy  a  chest,  and  I  should  pay  him  the 
in'ice  of  hyson,  and  he  should  deliver  me  a 
chest  of  bohea  or  souchcng;  I  might  recover 
the  difference  in  value,  if  he  should  refuse  to 
do  me  justice.  altUo\igh  he  did  not  expressly 
warrant  that  the  tea  in  the  chest  was  the  same 
as  that  in  the  sample.  Indeed  the  exhibition 
of  the  sample  mtist.  in  all  fair  dealing,  stand  in 
lieu  of  a  warranty-  or  affirmation.  It  is  a  si- 
lent, symbolical  wan-auty,  perfectly  understood 
by  the  parties,  and  adopted  and  used  for  the 
convenience  of  trade. 

The  cases  must  be  veiy  strong,  to  establish  a 
principle   so  imjust,   and  so  productive  of  dis- 


trust and  jealousy  among  traders,  as  that 
contended  for  by  defendant's  counsel.  For 
what  purijose  is  the  sample  exhibited,  unless 
it  is  intended  as  a  representative  of  the  tiling 
to  be  sold?  What  would  an  honourable  mer- 
chant say  if.  when  he  took  fi-om  a  mass 
of  sugar  or  coffee  a  small  pared,  and  offered 
to  sell  by  it,  the  man  who  was  dealing  with 
him,  should  ask  him  if  it  was  a  fair  sample, 
and  call  upon  him  to.  warrant  it  so?  Mercan- 
tile honour  would  Instantly  take  the  alann;  and 
if  such  questions  ^huuld  become  necessaiy.  there 
would  be  no  need  of  that  honour,  which  hap- 
pily is  now  general  and  almost  universally  re- 
lied upon.  That  there  is  not  an  unknown  and 
invisible  defect,  owing  to  natural  causes,  or  to 
previous  management  by  some  foimer  dealer, 
he  may  not  be  presumed  to  affirm  when  he 
shows  the  sample;  and  as  to  these  partictilars 
an  express  warranty  may  be  required,  consist- 
ently with  confidence  in  the  fair  dealing  of  the 
vendor.  But  that  the  thing  is  the  same,  ge- 
nerically  and  specifically,  as  that  which  he 
shows  for  it.  he  certainly  imdertakes,  and  if  a 
different  thing  is  delivered,  he  does  not  per- 
form his  contract,  and  must  pay  the  differ- 
ence, or  receive  the  thing  back  and  rescind  the 
bargain,  if  it  is  offered  him. 

A  case  similar  to  this  in  principle  came  be- 
fore me  two  or  three  years  ago  at  nisi  prius. 
An  advertisement  appeared  in  the  pajwrs, 
which  AA-as  published  by  a  very  resjiectable  mer- 
cantile house,  offering  for  sale  good  Cai'ac-cas 
cocoa.  The  plaintiff  made  a  purchase  of  a  c-on- 
siderable  quantitj-.  and  shipped  it  to  Spain; 
having  examined  it  at  the  store  before  he  pm*- 
chased;  but  he  did  not  know  the  differenc-e 
between  Caraccas  and  other  cocoa.  In  the  mar- 
ket to  which  he  shipped  it,  there  was  a  coui-id- 
erable  dift'erence  in  value,  in  favor  of  the  Carac- 
cas. It  was  proved  that  the  cocoa  was  of  the 
growth  of  some  other  pktce.  and  tliat  it  was 
not  worth  so  much  in  that  market.  I  held 
that  the  advertisement  was  equal  to  an  express 
M'arrantj-;  and  the  juiy  gave  damages  accord- 
ingly. The  defendants  had  eminent  counsel, 
and  they  thought  of  saving  the  question;  but 
afterwards  abandoned  it.  and  suffered  judgment 
to  go.  Surely  if  a  sample  of  Caraccas  cocoa 
had  been  shown  to  the  purchaser,  and  any  other 
cocoa  had  been  delivered  to  him.  the  case  would 
not  have  been  less  strong. 

We  are  all  decidedly  of  the  opinion,  that  a 
.sale  by  sample  is  tantamoimt  to  an  express 
warranty  tliat  the  sample  is  a  true  representa- 
tive of  the  kind.  There  must  therefore  be  en- 
tered judgment  according  to  the  verdict. 


o52 


WAUUANTY. 


CIIAP.MAX  V.  :MrRCH. 

(19  .Toluis.  290.) 

Supremo  Court  of  New  York.    Jan.   Torm. 
1S22. 

In  error  to  the  court  of  coiinnon  pleas  of 
Washington  county.  Chapman  brought  an 
action  of  assumpsit  against  Murch  in  the 
court  below.  The  declaration  stated,  that 
the  defendant,  on  the  1st  of  December,  1818, 
in  consideration  that  the  plaintiff  would  de- 
liver to  the  defendant,  a  certain  horse  of  the 
plaintiff  of  great  value,  in  exchange  fur  a  cer- 
tain horse  of  the  defendant,  the  de'fendant 
undertook  and  prondsed,  that  the  horse  of 
the  defendant  was  then  and  there  sound.  &c.; 
that  the  plaintiff,  contiding  in  the  said  prom- 
ise of  the  defendant,  delivered  to  him  the 
said  horse  of  the  plaintiff,  in  exchange  for  the 
defendant's  horse,  &c.  Yet  the  defendant, 
&c.  fraudulently.  &c.  did  not  perform  or  re- 
gard his  said  promise,  &c.,  for  that  the  hor.se 
of  the  defendant  was  not  sound,  but,  on  the 
contrary,  was  unsound,  and  had  a  certain  dis- 
ease, called  the  yellow  water,  of  which  he  aft- 
erwards, to  wit,  on  the  2d  day  of  December, 
1818,  died,  whereby.  &c.  The  defendant 
pleaded  the  general  issue,  and  on  the  trial  of 
the  cause,  the  plaintiff  offered  to  prove,  that 
the  parties  exchanged  horses;  that  the  plain- 
tiff let  the  defendant  have  a  horse  worth  100 
dollars,  in  consideration  of  which  the  defend- 
ant let  the  plaintiff  have  another  horse,  which 
the  defendant,  at  the  time,  represented  to  be 
Bound;  that  the  horse  of  the  defendant,  so  de- 
livered to  him  in  exchange,  was  not  sound, 
bttt  that  he  had  the  disease,  called  the  yellow 
water,  which  rendered  him  useless  and  of  no 
value,  and  that  he  died  the  next  day.  The 
evidence  so  offered  was  objected  to  by  the  de- 
fendant's counsel,  and  rejected  by  the  court, 
on  the  ground,  that  this  being  an  action  of 
assumpsit  founded  on  a  warranty  of  the 
soimdness  of  the  hor.se,  the  plaintiff,  in  or- 
der to  entitle  himself  to  a  recovery,  was 
bound  to  prove  an  express  warranty,  and 
that  the  testimony  offered  by  the  plaintiff 
did  not  amount  to  such  a  warrantv.     A  bill 


of  exceptions  was  taken  to  the  opinion  of  the 
court,  on  which  the  writ  of  error  was  brought. 
The  case  was  submitted  to  the  court  without 
argument,  on  a  statement  of  the  points  and 
authorities. 

SPEN'CER,  C.  .].,  delivered  the  opinion  of 
the  court.  In  the  various  cases  which  have 
been  cited,  it  appears,  abundantly,  that  when 
the  action  is  founded  on  a  warranty  of  the 
soundness  of  a  chattel  sold,  a  warranty 
must  be  proved;  but  it  nowhere  appears, 
that  it  is  necessary  that  the  vender  should 
use  the  express  words,  that  he  warranted 
the  soundness.  If  a  man  should  say,  on  the 
sale  of  a  horse,  "1  promise  yoti  the  horse  is 
sound,"  it  is  dilTictilt  to  conceive,  that  this 
is  not  a  warranty,  and  an  express  one  too. 
Peake  (on  Evid.  228»  says,  "in  an  action  on  a 
warranty,  the  plaintiff  must  prove  the  sale 
and  warranty."  "In  general,  (he  says,)  any 
representation  made  by  the  defendant  of  the 
state  of  the  thing  sold,  at  the  time  of  the 
sale,  will  amount  to  a  warranty."  He  adds, 
"but  where  the  defendant  refers  to  any  docu- 
ment, or  to  his  belief  only,  in  such  cases  no 
action  is  maintainable,  without  proof,  that 
he  knew  he  was  representing  a  falsehood." 
In  every  action  on  a  warranty,  it  must  be 
shown  that  there  was  an  express  and  direct 
affirmation  of  the  quality  and  condition  of 
the  thing  sold,  as  contradistinguished  from 
opinion,  &c.,  and  when  that  is  made  out,  it 
would  be  an  anomaly  to  require  that  the 
word  warrant  should  be  used.  Any  words  of 
equivalent  import,  showing  the  intention  of 
the  parties,  that  there  should  be  a  warranty, 
will  suffice.  In  the  present  case,  the  plain- 
tiff offered  to  prove  what,  under  the  circum- 
stances, might  be  an  express  warranty;  and 
that  was  for  the  consideration  of  the  jury, 
under  the  advice  of  the  court.  Seixas  y. 
Woods,  2  Caines,  56;  Pasley  v.  Freeman.  3 
Term  R.  57;  Cramer  v.  Bradshaw,  10  .Johns. 
484. 

The  judgment  must  be  reversed,  and  a 
venire  de  novo  awarded  to  the  court  below. 

Judgment  reversed. 


WARRANTY. 


353 


GHIEB  V.  COLE. 

(27  N.  W.  579,  GO  Mich.  397.) 

Supreme  Court  of  Michigan.    April  8,  1880. 

Error  to  circuit  court,  St.  Chiir  couuty; 
Steveus,  .Tudge. 

Assumpsit.  Defendant  brings  error.  Re- 
versed.    The  facts  are  stated  in  the  opinion. 

George  P.  Voorheis,  for  appellant.  Chad- 
wick  &  Wood,  for  plaintil¥. 

CHAMPLIN,  J.  On  May  1,  1883,  one  W. 
D.  McLaughlin,  as  agent  for  plaintiff,  took 
from  the  defendant  the  following  order: 
"Gratiot,  Mich..  May  2,  1883.  To  Charles 
Grieb,  Port  Huron,  Mich.:  You  will  please 
ship  me,  on  or  about  the  first  day  of  June, 
1883,  one  Buckeye  light  mower,  to  Port  Hu- 
ron, for  Avhich  I  agree  to  pay  you  $77,  in 
manner  as  follows,  (reserving,  however,  the 
full  benefit  of  the  warranty  hereon  indorsed:) 
51^35  cash,  with  freight  from  Port  Huron,  on 
deliveiy.  and  execute  approved  notes  as  fol- 
lows: .?3").  i^ayable  on  the  first  day  of  Janu- 
ary, 1884,  with  interest  at  7  per  cent,  from 
delivery;  $42,  payable  on  the  first  day  of 
.January,   1885,   with  interest  at  7  per  cent. 

from   delivery;    .$ ,   payable  on  the  

day   of  ,   188-,   with   interest   at  7   per 

cent,  from  delivery.  For  the  purpose  of  ob- 
taining credit  for  the  above,  I  certify  that  1 

own,  in  my  own  name,  acres  of  land  in 

the  township  of  Gratiot,  county  of  St.  Clair, 
and  state  of  Michigan,  of  which  SO  acres  are 
improved,  and  the  whole  worth,  at  a  fair 
valuation,  .$5.(XK>  over  and  above  all  incum- 
brances, liabilities,  and  legal  exemptions.  It 
is  not  incumbered,  except  1,000  dollars,  and 
the  title  is  perfect.  I  also  own  $500  worth 
of  personal  property  over  and  above  all  in 
debtedness,  and  not  exempt  fi'om  execution 
by  law.     P.  O.  address.  Port  Pluron.    Taken 

his 

by  W.  D.  McLaughlin.  Agent.    Chas.  X  Cole," 

mark 
— across  the  back   of   which   was   printed   a 
blank  warranty,  with  Grieb's  printed  name 

appended,  as  follows:     "Whereas,  Mr.  

has  this  day  given  us  his  order  for  a  , 

we  hereby  agree,  in  consideration  of  said 
order  and  the  faithful  performance  of  the 
conditions  herein  mentioned,  to  warrant  said 

one  year  to  be  good  and  well  made,  and 

to  do  as  good  work  as  any  other  machine  of  its 
class.  It  is  an  express  condition  of  this  war- 
ranty that  the  directions  for  using  this  ma- 
chine shall  be  faithfully  followed,  and  if  for 
any  reason  it  fails  to  perform  as  warranted, 
immediate  notice  of  the  same  must  be  com- 
municated to  the  agent  to  whom  the  order  is 
given,  and  if  said  agent  should  fail  to  make 
the  machine  perform  as  warranted,  it  may  be 
returned,  and  money  or  note  refunded.  And 
it  is  also  agreed,  should  the  machine  be  used 
from  day  to  da.v  or  at  intei-vals,  or  set  aside 
before  or  after  use,  without  giving  said  agent 
notice,  then,  in  either  of  said  cases,  it  shall  be 
conclusive  evidence  that  the  machine  is  ac- 

VAN  ZILE  SEL. CAS. SALES — 23 


cepted  and  the  warrant  is  at  an  end.    Dated 

.      Charles  Grieb."    The  agent  delivered 

this  so-called  "order"  to  the  plaintiff,  who 
claims  that  he  accepted  it,  and  delivered  to 
the  defendant  the  said  machine  on  the  eight- 
eenth day  of  July,  1883,  but  the  defendant 
has  neither  paid  for  said  machine,  nor  exe- 
cuted and  delivered  the  notes;  and  after  the 
time  expired  when  the  note  for  $35  mention- 
ed in  the  order  would  have  matured,  had  it 
been  executed,  the  plaintiff  brought  suit  in 
jtistice's  court  to  recover  the  amount  claimed 
to  be  due  at  that  time.  The  plaintiff's  decla- 
ration was  in  writing,  and,  besides  the  com- 
mon counts  in  assumpsit,  contained  a  special 
count,  setting  out  the  substance  of  the  above 
order,  and  alleging  a  delivery  of  the  machine 
ordered.     The  plea  was  the  general  issue. 

It  is  always  proper,  in  construing  a  con- 
tract, to  take  into  consideration  the  position 
Avhich  tlie  parties  occupied,  and  the  circum- 
stances under  which  the  agreement  was  en- 
tered into.  The  plaintiff  resided  at  Port  Hu- 
ron, and  was  engaged  in  the  business  of 
sui)plying  mowing-machines  to  farmers.  He 
was  not  a  manufacturer,  but  took  written  or- 
ders, and  purchased  the  machines  to  fill  such 
orders.  Defendant  is  a  farmer,  residing  in 
the  vicinity  of  Port  Huron,  and  on  the  sec- 
ond day  of  ^lay,  i8S3,  signed  the  order  above 
set  out,  and  delivered  it  to  plaintiff's  agent. 
On  the  trial  the  plaintiff  offered  in  evidence 
the  aforesaid  order,  and  warranty  thereon 
indorsed;  to  which  the  defendant  objected 
because  not  admissible  under  the  declara- 
tion, and  as  immaterial  to  the  issue.  The 
objection  was  overruled,  and  this  constitutes 
defendant's  first  assignment  of  error.  This 
objection  is  based  upon  the  idea  that  the 
paper  is  incomplete;  that  the  order  refers  to 
the  warranty  on  the  back,  and  reserves  the 
full  benefit  of  such  warranty,  and  it  appears 
that  the  blanks  in  the  warranty  were  not  fill- 
ed out;  and  it  is  claimed,  and  I  think  rightly, 
that  the  warranty  indorsed  must  be  of  such 
legal  validity  as  to  support  an  action  there- 
on by  Cole  in  case  of  a  breach  thereof. 

By  reference  to  the  Avarranty  indorsed,  it 
will  be  observed  that  the  name  of  Mr.  Cole, 
and  the  description  of  the  machine  ordered, 
ai'e  omitted,  as  well  as  the  date.  If  the 
warranty  stood  alone,  there  could  be  no 
doubt  that  it  would  be  so  far  incomplete  as 
to  render  it  invalid,  because  thiis  standing 
it  lacks  the  essential  qualities  of  naming  the 
party  to  be  indemnified  and  the  subject-mat- 
ter. It  does  not  appear  from  it  whether  the 
machine  is  a  steam-thresher  or  a  mowing- 
machine.  But  the  reference  in  the  order  to 
the  warrait,v  indorsed  thereon  constituted 
tl.ie  order  and  warranty  one  instrument,  and 
when  read  together,  no  ambiguity  or  uncer- 
tainty appears.  The  party  to  whom  the  war- 
ranty is  made  is  the  party  making  the  order, 
and  the  machine  is  the  machine  described  in 
the  order,  and  the  date  of  the  order  supplies 
the  date  to  the  warranty,  for  they  are  con- 
temporaneous,   and    the    warranty    has    the 


354 


WAUKAN'J'Y. 


same  forco  and  cfft'ct  as  il"  t>inl)(><lu'(l  in  the 
t.rdiT  itself.  Tlu'  warrantor  is  bound  by  tLo 
printed  signature  wliicli  lie  adopts  as  his  as 
fully  as  if  it  was  in  his  handwriting.  The 
order  and  warranty  were  properly  admitted 
in  evidence  at  that  stage  of  the  case. 

The  plaintiff  gave  evidence  tending  to  show 
that  he  had  complii'd  with  the  contract  on 
his  part,  and  had  delivered  the  machine  at 
Tort  Huron  within  the  terms  and  nu^aiiing 
of  the  contract,  and  also  had  recpiestcMl  de- 
fendant to  execute  the  notes,  and  that  de- 
fendant declined  to  accept  such  delivery,  or 
to  execute  and  deliver  the  notes.  'I'he  fact 
of  delivery  was  controverted  by  defendant. 
'IMie  defendant  also  offered  testimony  tending 
to  show  that  the  mower  which  plaintiff 
claimed  to  have  deliver(>d  to  defendant  was 
;i  second-hand  machine,  showing  considera- 
ble wear;  that  the  worn  parts  had  been 
stripped  and  tilled  with  paint  in  the  wood- 
worlv.  and  parts  of  it  had  been  painted  over 
after  liaving  been  usv'd  and  worn;  that  the 
axles  had  old  grease  upon  them,  one  set  of 
knives  were  chipped  and  broken,  and  flie 
tongue  and  neck-yoke  considerably  worn; 
that  the  entire  machine  had  been  used  one 
season  somewhat;  but  the  court,  on  objection 
of  plaintiff"s  counsel,  excluded  this  evidence 
as  not  admissible  under  the  plea,  and  not 
tending  to  show  the  condition  of  the  machine 
when  delivered.  The  latter  portion  of  this 
i-uling  was  based  upon  the  fact  that  the  wit-  1 
nesses  by  whom  these  facts  were  sought  to 
be  proved  did  not  make  the  examination  of  I 
the  machine  until  after  the  trial  in  the  jus-  I 
tice's  court  :n  April.  1SS4.  The  evidence,  I 
however,  showed  that  on  the  twenty-first  of  j 
July,  1SS:{,  which  was  three  days  after  plain- 


tiff claims  to  have  sent  the  machine  to  de- 
fendant's farm  and  demanded  the  notes,  de- 
fendant gave  written  notice  to  plaintiff  that 
he  refused  to  purchase  it,  and  that  it  was 
there  at  plaintiff's  risk,  and  to  come  and  take- 
it  away,  and  the  testimony  was  that  it  had 
not  been  used  since.  There  was  therefore  no 
reason  for  excluding  the  testimony  on  tins 
ground. 

The  court  erred  also  in  excluding  the  evi- 
dence upon  the  other  ground  stated.  It  was 
pioper  for  the  defendant,  under  the  plea  of 
the  general  issue,  to  prove  that  the  artich' 
delivered  was  not  the  article  he  purcliased. 
He  did  not  order  or  purchase  a  second-haniL 
mowing  machine,  or  one  that  had  been  in 
use  and  worn;  but  the  order,  taken  in  co'i- 
nection  with  the  circumstances  under  which 
it  was  made,  called  for  a  new  machine.  A 
purchase  of  a  machine  from  a  dealer  implies 
that  the  machine  sold  shall  be  new,— that  is,, 
not  second-hand,  or  the  worse  for  wear,— 
and  under  such  an  order  the  dealer  could  not 
impose  upon  the  purchaser  a  second-hand 
and  worn  article,  whether  it  complied  with 
the  terms  of  the  warranty  or  not,  as  to  being 
good  and  well  made,  and  will  do  as  good 
work,  as  any  other  machine  of  its  class. 
This  evidence,  if  believed,  fairly  met  and  re- 
butted the  plaintiff"s  case,  and  tended  di- 
rectly to  sustain  tlie  defendant's  plea,  wdiich 
put  in  issue  each  and  eveiy  allegation  of  tlie 
plaintiff's  declaration.  Rodman  v.  Guilford. 
112  Mass.  405. 

The  judgment  must  be  reversed,  and  a  nvw" 
trial  ordered. 

CAMPBELL.  C.  J.,  and  MORSE,  J.,  con- 
curred.    SHERWOOD,  J.,  did  not  sit. 


WARRANTY. 


355 


MFRPHY  V.  .M.CKAW. 

(41  X.  W.  !»17.  74  Mi<h.  aiS.) 

Snpremp  Court  of  Micliisau.      Fch.  20.  1.S89. 

Error  to  circuit  court,  Bay  county;  Gage, 
Juiige. 

Action  by  Albert  II.  Murpby  ngainst  Frank 
S.  McCiravv.  Judgment  for  plaintiff,  and  de- 
fendant brings  error. 

iiimu7is'>7i,  (jfi/lett  d-  Court ric/ht,  for  appel- 
lant.    T.  A.  E.  d- ./.  C.  Weado'Ix,  for  appellee. 

LONG,  J.  Tills  action  is  brouglit  to  re- 
cover money  paid  by  jilaintiff  to  defendant 
for  a  liorse.  and  money  expended  by  ])laintifl: 
in  attempting  to  cure  the  liorse  of  disease. 
Plaintiff  had  a  verdict  and  judgment  in  the 
court  below  for  $001.50.  Defendant  brings 
error. 

The  declaration  is  upon  the  common  counts 
in  assionpsit,  to  whicli  are  added  two  special 
counts,  setting  out  the  puicliase  and  sale  of 
the  horse  under  a  warranty  that  lie  was  sound, 
straiglit,  and  all  right,  and  just  sucli  a  liorse 
us  plaintiff  wanted,  and  met  all  the  require- 
ments stated  by  plaintiff  to  defendant  prior 
to  the  purchase,  alleging  a  breach  of  the  war- 
ranty, and  tliat  the  horse  was  of  no  value 
whatever  at  the  time  of  the  purcliase.  In  the 
first  special  count  plaintiff  alleges  that  on  the 
10th  day  of  March,  1887,  defendant  sold  him 
a  horse  for  8400,  and  promised  that  the  horse 
was  sound  and  witiiout  a  blemish,  and  under 
G  years  of  age;  and  further  promised  that  if 
the  horse  should  prove  unsound  defendant 
would,  Oil  the  return  of  the  same,  repay  the 
purchase  price;  and  that  the  horse  was  12 
years  old  and  was  unsound  and  blemished; 
and  on  November  18,  1887,  he  returned  the 
horse  to  defendant,  who  received  the  same, 
and  hath  wholly  refused  to  repay  said  sum  of 
money.  The  second  special  count  is  as  fol- 
lows: "And  also  for  that,  whereas,  on  or 
before  the  10th  day  of  March,  1887,  tlie  said 
ilefendant  was  the  owner  and  in  possession 
of  a  certain  horse  which  he  was  ottering  for 
sale,  and  one  A.  T.  Miller  was  an  employe  of 
defendant  for  hire,  and  was  then  and  there 
in  charge  of  defendant's  stables  and  of  said 
horse,  as  such  employe,  and  said  plaintiff, 
being  desirous  of  purchasing  a  sound,  speedy, 
and  healthy  horse  for  his  own  use,  the  said 
defendant  represented  said  horse  to  lie  such 
an  one  as  above  described,  and  such  as  plain- 
tiff desired  to  purchase.  >Saiil  plaintiff,  when 
examining  said  horse,  iKJticed  some  sliiiht 
marks  and  abrasions  of  the  skin  on  said 
horse's  legs  and  feet,  and  upon  which  some 
medicine  had  been  used,  and,  calling  the  at- 
tention of  said  defendant  to  the  same,  he  was 
assured  by  said  defendant  and  said  Miller,  in 
tiie  presence  and  hearing  of  said  defendant, 
that  said  abrasions  and  marks  were  caused 
by  a  slight  attack  of  scratches,  a  common  and 
comparatively  harmless  complaint;  and  said 
plaintiff,  relying  on  said  assurances  so  given 
by  said  defendant,  thereupon  bought  said 
horse,  and  paid  \o  <nid  defendant  the  sum  of 
four  hundred  dollars  in  lawful  money  for  said 
horse,  which  sum  would  be  his  value  if  he 


was  sound  and  such  a  horse  as  defendant  rep- 
resented him  to  be.  After  said  plaintiff 
took  possession  of  said  horse,  said  malady  be- 
came very  much  worse,  notwithstanding  the 
fact  that  said  horse  receiveil  the  bei»t  possible 
care  and  medical  treatment;  and  what  was 
represented  by  said  defendant  and  said  silli- 
er, his  einjiloye  as  aforesaid,  to  be  a  tenipoiary 
and  harinh  ss  blemish  was  really,  at  the  time 
said  horse  was  sold  to  plaintiff,  and  fornionlhs 
prior  thereto  had  been,  and  still  is,  a  loath- 
some, incurable,  and  serious  disease  of  the 
skin,  rendering  said  horse  woithless,  all  of 
which  the  said  defendant,  before  and  at  the 
time  lie  sold  said  horse  to  plaintiff,  well  knew; 
whereupon  said  plaintiff  informed  said  de- 
fendant of  the  condition  of  said  horse,  on  or 
about  the  15th  day  of  March,  1887,  and  kept 
him  informed  from  tiuie  to  time  of  the  afore- 
said condition  of  said  horse,  and  said  defend- 
ant, when  so  informed  of  tlie  disease,  blemish, 
and  unsoundness  aforesaid,  still  claimed  that 
said  disease  was  curalile,  and  reijuested  plain- 
tiff to  continue  having  said  horse  treated 
medically,  which  said  plaintiff  then  and  there 
did,  notwithstanding  which  care  and  medical 
treatment  said  horse  did  not  improve  or  re- 
cover from  said  disease,  and  plaintiff,  on  or 
about  the  lyth  day  of  November,  1887,  re- 
turned said  horse  in  the  same  condition  in 
which  lie  received  him  to  said  defendant," 
etc.  This  count  then  alleges  a  promise  to  re- 
pay tlie  money  so  paid  for  said  horse,  and  a 
refusal  to  repay  the  same. 

riaintitf  also  filed  a  bill  of  particulais  in 
the  case  under  the  ct)mmon  counts,  as  follows- 
To  cash  received  by  defendant  for  the  ute  of 
j)laintiff,  .'i?400;  interest  on  the  same,  828; 
cash  expended  for  medicine,  care,  and  main- 
tenance of  the  liorse  from  March  10  to  No- 
vember 19,  1887,  8300;  cash  paid  for  freight 
for  conveying  said  horse  from  Bay  City  U> 
Detroit,  and  from  Detroit  to  Bay  City,  $50;. 
total,  8778.  The  plea  is  the  general  issue- 
After  the  jury  were  sworn  in  the  case,  de- 
fendant's counsel  objected  to  tlie  introduction 
of  any  testimony,  on  the  grounds:  (1)  That 
the  declaration  did  not  state  a  cause  of  action. 
(2)  That  the  second  count,  b -ing  a  count  in 
tort,  cannot  be  joined  with  the  lirst  county 
which  is  a  count  in  (i.ssiiin/isit,  and  that  the 
plaintiff  elect  upon  which  count  he  will  pro- 
ceetl.  (3)  That  the  two  counts,  if  they  aie 
in  assainDnit.  are  inconsistent  with  each 
other,  and  the  plaintiff  should  elect  upon 
which  he  will  proceed;  the  first  being  on  ex- 
press contract,  and  the  second  on  an  implied 
one.  The  court  very  properly  overnihd  these 
objections.  These  counts  are  in  assn7))p.sit 
to  recover  back  the  money  which  plaintifT 
claims  defendant  obtained  from  him  without 
consideration,  by  the  sale  of  a  horse  which 
lilaintiff  contends  was  wholly  worthless,  and 
which  he  purchased  upon  the  warranty  of 
defendant  that  it  was  sound,  straight,  and  all 
right,  and  just  such  a  horse  as  plaintiff  want- 
ed. The  first  special  count  alleges  the  war- 
ranty, and  its  breach.  The  second  special 
count  alleges  the  warranty,  and  sets  out  with 
much  particularity  the  condition  of  the  horse 


356 


WARRANTY. 


ut  tlie  time  of  tlie  purchase;  the  reprcspnta- 
tion  tlit^n  made  by  tlie  defendant  and  his 
employe  as  to  tlie  condition  of  the  horse,  and 
assurances  that  tiie  marks  or  abrasions  were 
scratclies,  a  common  and  comparatively  haim- 
less  complaint;  the  reliance  of  the  plaintiff 
upon  these  rej)resentations;  and  the  fact  that 
with  the  best  care  and  medical  treatment 
what  was  represented  to  be  scratclies  proved 
to  be,  and  js,  a  loathsome  and  incurable  dis- 
ease, rendering  the  horse  worthless.  These 
two  counts  in  the  declaration  each  state  a 
cause  of  at  tion,  and  are  not  inconsistent,  and 
the  court  ^•el•y  properly  refused  to  compel  the 
plaintiff  to  elect  under  vvliich  he  would  pro- 
ceed. The  first  count  is  in  assinnpsit  for 
H  breach  of  the  warranty  in  the  sale.  The 
second  is  in  assumpsit  for  tiie  recovery  of 
momy  paid  without  consideration;  setting 
up  the  circum>tances  under  which  it  was 
obtained,  and  tiiat  the  horse  purchased  was 
absolutely  witiiout  value.  The  question 
whether  upon  a  breach  of  the  warranty  a 
riglit  existed  to  return  the  property,  is  one 
of  law;  and,  as  there  was  no  acceptance  of 
the  return,  if  that  right  did  not  exist,  then 
the  averment  of  return  offered  was  surplus- 
age, and  left  the  special  counts  as  if  it  had 
been  omitted,  ami  the  claim  of  too  much 
would  not  vitiate  the  rest.  Manufacturing 
Co.  V.  Vronian,  35  Mich.  o25.  Even  if  these 
special  counts  had  nut  been  added,  under  the 
circumstances  shown  upon  the  trial  and  claim 
made  the  plaintiff  might  liave  recovered 
under  the  comnn)n  counts  alone.  If,  as  it 
is  claimed  by  the  plaintiif,  the  horse  was  of 
no  value  whatever,  tiien  the  defendant  iiad 
obtained  .'i?4n0  of  plaintiff's  money  without 
consideration,  which,  in  equity  and  good 
conscience,  he  ought  to  repay;  and  in  the 
language  of  Lord  Ellenbouol'Gii  in  Hudson 
v.  Robinson,  4  Maule  &  S.  475,  47b:  "An 
action  for  money  iiad  ar.d  received  is  main- 
tainaide  whenever  the  money  of  one  man  lias 
without  consideration  got  into  the  poiket  of 
another;"  and,  whether  tlie  i-ecovery  was 
asked  on  the  special  or  general  counts,  the 
same  facts  had  to  be  relied  on  by  the  plain- 
tiif, and  the  same  defense  made.  Under  the 
theory  of  the  case  the  plantitf  could  only 
recover  ujjon  the  ground  that  the  money  was 
paid  without  consideration,  and  a  recovery 
in  such  a  case  may  be  had  on  the  common 
counts  in  assumpsit.  Bear.'.slee  v.  llorton, 
3  Mich.  5(J0;  Petersen  v.  Lumber  Co.,  51 
Mich.  86,  16  N.  W.  Kep.  243;  Phippen  v. 
JNIorehouse,  50  Mich.  537,  15  X.  W.  Rep.  895; 
Lockwood  V.  Kelsea,  41  N.  H.  186;  Grannis 
V.  Hooker,  29  Wis.  65;  Lane  v.  Room  Co., 62 
Mich.  63,  28  N.  W.  Rep.  786;  Nugent  v. 
Teachout,  35  N.  W.  Rep.  254. 

Counsel  for  defendant  has  devoted  much 
space  in  his  bi  ief  to  the  consideration  of  the 
question  that  wlien  there  is  a  warranty  as  to 
quality  on  the  sale  of  goods,  but  no  fraud, 
and  no  stipulatiim  that  the  goods  may  be  re- 
turned though  the  warranty  be  broken,  the 
vendee  cannot  rescind  the  contract  without 
the  consent  of  the  vendor;  that  a  breach  of 
warranty  alone  will   not  justify  a  return. 


This  may  be  conceded  as  well  settled  as  a 
general  j)roposition,  but  there  may  be  cases 
where  a  purchaser,  without  returning  an  ar- 
ticle, may  yet  be  allowed  to  recover  its  cost. 
The  declaiation  alleges  that  the  defendant 
represented  the  horse  as  sound,  straight,  and 
all  right,  just  such  a  horse  as  the  plaintiff 
wanted.  These  representations  amounted 
to  a  warranty.  The  claim  made  on  the  trial 
by  the  plaintiff  was  that  about  the  1st  of 
March,  1887,  he  went  to  the  farm  wheie  the 
horse  was  kept,  with  the  defendant,  and  told 
him  wiiat  kind  of  a  horse  he  wanted;  that  he 
wanted  a  good,  prompt,  driving  horse, — one 
that  would  go, — when  defendant  said  he  had 
one  that  would  fill  the  bill.  Tlie  defendant, 
showing  the  horse  in  question  to  the  plain- 
tiff, said  it  was  six  years  old,  and  was  straight, 
and  all  right.  The  farm  was  some  tlnee 
miles  out  from  the  city  of  Bay  City.  The 
horse  was  in  charge  of  Mr.  Miller,  who 
hitched  him  up,  and  plaintiff,  defendant,  and 
Miller  got  in,  and.  Miller  driving,  th^  parties 
came  to  the  Frazer  House,  in  the  city,  and, 
as  plaintiff  says,  "We  came  down  to  the 
Frazer  House  about  as  fast  I  ever  drove  in 
my  life."  Arriving  at  the  Frazer  House, 
plaintilT  told  the  defendant  he  would  take  the 
liorse  at  the  price,  !g400.  The  horse  was 
taken  by  Miller  back  to  the  farm,  when,  in 
about  two  weeks  tlrere.ifter,  plaintiff  came 
again  to  Bay  City,  went  out  to  the  farm,  met 
defendant  there,  and,  in  looking  the  horse 
over,  found  his  iieels  were  sore.  LTpon  call- 
ing defendant's  and  Miller's  attention  to  this, 
they  iioth  said  it  was  nothing  but  the  scratches, 
and  it  would  be  all  right  in  a  little  while;  that 
they  had  been  blistering  his  heels.  Plaintili: 
said,  "  What  sliall  I  doV"  JSIiUer,  in  presence 
of  defendant,  said,  "Do  nothing;  they  will 
cnine  out  all  right."  Instead  of  i\v.^  feet  be- 
ing sore  in  the  cracks,  where  scratches  w<nild 
come,  they  were  sore  all  over  the  foot,  and 
covered  with  white  matter  on  top  of  the  hoof, 
on  the  back  side  of  ttie  he  Is,  and  on  the  ankle 
joint.  Plaintiff  says:  "I  took  the  horse  then, 
and  paid  tlie  ■■:?4U0,  because  I  relied  a  good 
deal  on  McGraw's  sayings  and  judgment  as 
to  what  the  disease  was."  The  hoise  was 
taken  to  Detroit  on  March  15,  1887,  and,  as 
plaintiff  claims,  had  the  best  of  care,  and 
was  treated  for  scratches,  and  was  driven  but 
very  little.  About  April  1st  plaintiff  em- 
ployed a  veterinary  surgeon,  who  treated  him 
until  August.  This  sur-jeon  j)rnnonnced  the 
disease  eczema.  About  10  days  alter  the 
horse  was  taken  to  Detroit,  filaintiff  met  de- 
fendant at  Bay  City,  and  informed  him  of 
tlie  condition  of  the  horse,  and  that  he  could 
do  nothing  with  him.  Defendant  then  went 
to  a  liorseman,  purchased  a  box  of  medicine, 
and  told  plaintiif  it  would  cure  him.  Plain- 
tiff upon  this  occasion  told  defendant  that  the 
veterinary  surgeon  called  the  disease  "ecze- 
ma." Defendant  said,  "l'shaw,it  is  nothing 
but  the  scratches. "  It  appears  tliat  the  phiin- 
tiff  continued  to  treat  the  hoi-se  up  to  No- 
vember 19,  1887,  when  he  returned  him  to 
the  defendant,  who  refused  to  receive  him; 
when  he  was  sent  to  a  boarding  stable,  and 


WAKKAXTY. 


357 


in  a  few  weeks  after  put  up  and  sold  for  his 
kef>i)ing,  and  purchased  at  the  sale  lor  alnnit 

Some  considerable  testimony  was  given  on 
tlie  trial,  showing  tlie  condition  of  the  horse, 
and  that  lie  wa^^  affected  with  chronic  eczema; 
the  claim  of  plaintiff  being  that  he  was  so 
alHicted  at  the  time  of  the  sale,  and  that  lie 
kept  him,  and  attempted  the  cure,  in  relian"e 
upon  the  assurances  of  defendant  that  it  was 
notliing  more  tlian  scratches;  and  tliat  by 
reason  of  this  he  was  not  only  entitled  to  re- 
cover the  purcliase  price  and  interest,  but 
also  the  amount  expended  in  care  and  medi- 
cine and  medical  treatment,  as  well  as  the 
cost  of  transportation  from  Bav  City  to  De- 
troit and  return  to  Hay  City.  This  last  item 
of  costs  of  return  to  Bay  City  the  court  in- 
structed the  jury  tlie  plaintiff  could  not  re- 
cover, so  that  item  is  out  of  the  case.  Xo 
claim  was  made  on  the  trial  that  tiiere  was 
an  agreement  made  on  the  sale  that  the  plain- 
tiff iiii<ilit  return  the  liorse  if  it  should  prove 
unsound,  and  receive  back  the  purchase  price, 
and  no  claim  was  made  that  there  was  an  ac- 
ceptance of  the  horse  when  return  was  made; 
but  it  app''ars  that  no  such  agreement  or  un- 
derstanding was  liad,  and  tliat  d.^fendant  re- 
fused to  accept  the  liorse  when  returned. 
The  whole  case  proceeded  upon  the  theory 
that  the  warranty  was  made  of  a  sound  horse, 
which,  at  the  time  of  the  purchase,  was  not 
only  unsound,  but  was  wholly  worthless  by 
reason  of  being  atHicted  with  a  dan.'erons 
and  contagious  disease  called  "eczema."  and 
that  therefore  the  money  paid  was  without 
consideration,  and  might  be  recovered  back 
together  with  interest.  We  think  the  proofs 
tend  to  show  these  facts,  and  that  this  part 
of  the  case  was  very  fairly  submitteii  to  the 
jury,  under  the  charge  of  the  court. 

Defendant's  counsel  contends  that,  how- 
ever this  might  be,  there  is  no  allegation  in 
the  declaiation  under  which  the  costs  of 
transportation,  keeping,  and  medicines  and 
medical  attendance  can  be  recovered,  and 
that  the  plaintiff  kept  the  horse  an  unreason- 
able length  of  time  before  olfering  him  back, 
as  there  was  nothing  in  the  delendaiit's  con- 
duct or  statements  justifying  the  plaintiff  in 
keeping  the  horse  as  long  as  he  did.  Counsel 
cites  Lumlier  Co.  v.  Bates,  31  Mich.  158,  in 
support  of  this  proposition.  We  ihiiik  these 
it'ms.  under  proper  proofs,  could  be  recovered 
under  the  declaration  as  framed.  To  the 
two  special  counts  were  added  the  couimon 
counts  in  assumpttit,  and  under  these  com- 
mon counts  tlie  plaintiff  tiled  a  bill  of  partic- 
ulars setting  out  these  items,  and  claiming 
a  recovery  thereon.  This  is  a  very  different 
case  from  the  one  cited  by  counsel.  It  is 
claimed  here  that  the  plaintiff  notilied  the 
delendant  some  10  days  after  the  purchase  as 
to  the  condition  he  was  in;  that  he  saw  him 
several  times  afterwards,  and  each  time  de- 
fendant insisted  he  would  come  out  all  right, 
and  at  one  time  gave  plaintiff  medicine  to 
use.  Upon  this  part  of  the  case  the  court 
stated  to  the  jury:     ">Co\v,  if  lie  was  led  by 


Mr.  Mcfiraw  to  believe  he  ought  to  keep  on 
tryiu;;,  he  was  perfectly  justified  in  trying, 
and  the  expense  of  it  would  be  ciiargeable  to 
Mc(ira\v;  or,  even  without  any  encourage- 
ment on  the  part  of  Mc(Jraw,  if  there  were 
any  circumstances  about  it  as  in  your  judg- 
ment rendered  it  reasonable  that  lie  sliould 
keep  on  trying  as  long  as  he  did,  that  he  was 
justified  in  doing  it,  and  the  expense  of  keep- 
ing the  hoise  while  he  was  doing  it  is  ch  irge- 
able  to  McGraw.  Jiut  if  it  should  tirn  out 
that  early  in  the  season,  soon  after  he  got  the 
liorse,  he  found  out  so  much  about  it  as  ought 
to  satisfy  any  man  of  reasonable  judgment 
and  prudence  ^that  the  horse  was  then  good 
for  nothing,  and  if  he  was  led  along  liy  any 
statements  that  McGraw  was  making  to  li;ia 
from  time  to  time,  then  the  expense  of  liis 
keeping  and  doctoring  him  expired  at  such 
time  as  you  in  your  judgment  shall  deteimine 
to  be  reasonable."  Under  the  claim  made 
by  the  plaintiff,  which  his  proofs  tended  to 
supjort,  we  think  this  was  a  proper  charge, 
and  fairly  submitted  to  the  jury  the  questions 
raised. 

Twenty-two  errors  are  assigned.  Sevei'al 
of  these  assignments  of  error  relate  to  the  re- 
fusal of  the  court  to  charge  the  jury  as  re- 
quested by  the  defendant.  We  hiive  ex- 
amined them,  and  are  of  opinion  that  those 
wliich  the  court  should  have  given  as  stating 
the  law  correctly  are  covered  by  the  general 
charge.  Several  of  the  requests  of  counsel 
for  defendant  were  properly  refused  by  the 
court.  Tiiey  are  based  upon  the  proposition 
that,  inasmucli  as  the  plaintiff  made  no  proof 
that  it  was  agreed  that  plaintiff  m  ght  retuin 
the  horse  if  he  proved  unsound,  therefore  he 
had  no  legal  right  to  return  it,  and  he  must 
stand  by  his  bargain,  and  his  only  remedy 
would  be  for  damages  for  breach  of  warr.mty; 
that  he  could  not  return  the  property  and  sue 
tor  the  consideration.  From  the  view  we 
take  of  the  case,  and  what  we  have  already 
said,  these  questions  need  not  now  be  dis- 
cussed, as  the  court  was  not  in  error  in  re- 
fusing these  requests.  Several  assignments 
of  error  relate  to  the  ruling  of  the  court  in 
allowing  certain  testimony  to  be  given  by  tlie 
plaintiff.  We  do  not  think  it  would  be  profit- 
able to  go  over  tlie  testimony  given  on  the 
trial,  and  point  out  thesf'  objections,  and  give 
our  x'easons  why  this  testimony  is  couijuteiit, 
and  was  pn^perly  admitted  by  the  court.  It 
is  a  somewhat  peculiar  case  in  some  of  its 
features,  (.'ounsel  upon  either  side  seem  to 
have  had  widely  varying  opinions  as  to  just 
what  the  declaration  allegeii,  and  whether  it 
was  in  athrmance  or  rescission  of  the  contract 
of  sale,  what  testimony  was  admissible  un- 
der it,  and  the  measure  of  plaintiff's  damajzes 
under  the  case  made  by  it.  We  think  the 
case  fairly  tried,  and  fairly  submitted  to  the 
jury  by  the  charge  as  given.  The  judgment 
of  the  court  below  must  be  alMrmed,  with 
costs. 

SHERWOOD,  C.  J.,  did  not  sit.     The  oth- 
er justices  coiiciirred. 


^558 


WARRAXTY. 


MERGUIRE  V.   O'DOXNELL.      (No.  15,072.) 

(3G  Pac.  1033,  103  Cal.  50.) 
>;ni>romo  Court  of  California.     June  12,   1894. 

Commissioners'  decision.  Department  2. 
Aiipeal  from  superior  court,  city  and  coun- 
ty of  San  Francisco;   A.  A.  Sanderson,  Judge. 

Action  by  J.  II.  Merguire  against  Tlionias 
O'Donnell  for  deceit.  Judgment  for  plain- 
tiff.     Defendant    appeals.     Atlirmed. 

I'\  B.  Ogden,  for  appellant,  i-.  A.  llorn- 
liliiwcr.  for  respondent. 

SEARLS,  C.  This  is  an  action  to  recover 
<l:i  mages  for  deceit  and  fraudulent  repre- 
>;entations  in  the  sale  by  defendant  to  plain- 
tiff of  three  horses.  Plaintiff  had  judgment 
tor  $050.  from  which  judgment,  and  from  an 
order  denying  a  motion  for  a  new  trial,  de- 
fendant appeals. 

About  the  1st  of  June.  1800,  plaintiff  pur- 
<>liased  from  the  defendant,  at  East  Oak- 
laud,  three  horses,  for  .$400;  paying  $100 
down,  and  the  residtie  to  be  paid  the  fol- 
lowing day.  upon  delivery  of  the  horses  in 
San  Francisco.  Defendant  called  upon 
plaintiff  the  following  morning,  in  advance 
of  the  arrival  of  the  hoi-ses,  and  received 
the  i-esidue  of  the  purchase  price.  Almost 
immediately  tipon  the  arrival  of  the  horses, 
and  within  an  hour,  they  were  found  to  be 
ailing,  and  discharging  from  the  nose.  The 
disease  with  which  they  were  afflicted  proved 
to  be  glanders.  One  of  them  was  con- 
demned by  the  public  authorities,  and  killed 
in  a  short  time,  and  the  others  shared  the 
same  fate  a  few  months  later.  Plaintiff, 
after  the  death  of  the  first  horse,  offered  to 
return  the  others,  and  demanded  a  rescis- 
sion of  the  contract,  and  return  of  his  mon- 
ey, which  was  reftised  by  the  defendant. 
The  complaint  charged  defendant  with  false- 
ly and  fratidulently  representing  to  plaintiff 
that  the  horses  were  well  and  soimd;  that 
the  plaintiff  believed  these  statements  to  be 
true,  and,  relj'ing  tipon  them,  was  induced 
to  purcliase;  and  that  defendant  well  knew 
the  statement  to  be  false,  etc.  The  catise 
was  tried  by  a  jury,  and  the  main  contro- 
versy was  as  to  these  representiitions  and 
knowledge  by  defendant  of  the  condition  of 
1he  animals.  There  was  testimony  on  the 
part  of  plaintiff  tending  to  show  that  de- 
fendant knew  the  condition  of  the  horses, 
instnicted  his  employe  to  keep  their  noses 
clean  when  plaintiff  and  his  brother  came  to 
examine  them,  which  was  done,  and  that  he 
represented  to  plaintiff"  that  "they  were  all 
sound,  except  one  hors(\  who  had  a  blind 
eye,"  and  at  another  time,  during  the  nego- 
tiation, when  asked  if  there  was  anything 
the  matter  with  them  (the  horses),  he  said. 


"No,  except  that  one  had  a  defect  in  the 
eye."  On  the  otlier  hand,  there  was  a  de- 
nial of  all  these  representations  by  defend- 
ant, and  of  all  knowledge  on  his  part  of  any 
ailment  or  disease  in  the  horses.  A  num- 
ber of  other  witnesses  on  the  part  of  defend- 
ant testified  that  the  horses  showed  no  signs 
of  glanders  tip  to  the  time  of  sale.  In  tlu' 
face  of  this  conflict  of  evidence,  we  must  r(>- 
gard  the  verdict  of  the  jurj'  as  conclusive 
upon   the  facts. 

Tlie  jury  rendered  a  verdict  in  favor  of 
plaintiff  for  $(550.  This,  it  is  claimed  by 
appellant,  was  excessive.  There  was  testi- 
mony tending  to  show  that  plaintiff  expend- 
ed about  $100  in  surgical  treatment  of  the 
horses,  and  that  he  destroyed  the  stable  in 
which  the  diseased  horses  had  been  kept, 
and  burned  the  materials,  which,  owing  to 
the  higlily  contagious  cliaracter  of  the  dis- 
ease, was  shown  to  be  reasonably  propei- 
This  stable  was  shown  to  have  bet>n  worth 
$200.  As  plaintiff  was  entitled  to  recover, 
if  at  all,  the  purchase  price  of  the  horses, 
which  was  $400,  we  cannot  say  the  added 
$250  thereto  was  excessive,  in  view  of  tin- 
fact  that  the  several  special  causes  of  dam- 
age Avere  pleaded. 

The  instructions  asked  by  the  defendant, 
and  refused  by  the  court,  were  objectiona- 
ble, for  various  reasons. — the  first,  because, 
while  it  correctly  enunciated  the  law  as  to 
the  doctrine  of  caveat  emptor,  in  the  ab- 
sence of  fraud  or  of  a  waiTanty.  still  it  was 
inapplicable  to  the  case  at  bar.  in  which  thi> 
gravanu'U  of  the  charge  was  (1)  fraud  on  the 
part  of  the  defendant,  whereby  plaintiff  was 
prevented  from  discovering  the  diseased  con- 
dition of  the  horses;  (2)  an  express  warranty 
of  soundness  of  the  horses  by  the  defendant: 
and  (3)  because  so  much  of  the  instruction  as 
was  applicable  was  subsequently  given.  Like 
observations  apply  to  the  refusal  of  the  coiu-t 
to  give  the  other  insti-uctions  asked.  The 
court,  upon  its  own  motion,  instructed  the 
jury  upon  the  issues  made  in  the  case,  and,  so 
far  as  we  observe,  there  was  no  error  there- 
in; and,  as  no  objection  was  made  or  excep- 
tion taken  to  such  instructions,  they  are  not 
the  sul)jeet  of  review.  The  necessity  for  the 
destrtiction  of  plaintift"s  stable,  by  reason  of 
the  virus  of  the  glandered  horses,  is  alleged 
in  the  complaint,  and,  not  being  denied  by  the 
answer,  was  an  admitted  fact  in  the  case. 
The  judgment  and  order  appealed  from 
should  be  afiirmod. 

We  concur:    VANCLIEF,  C;   TEMPLE,  C. 

PER  CURIAM.  For  the  reasons  given  in 
the  foregoing  opinion,  the  judgment  and  or- 
der appealed  from  are  aflirmed. 


WARRANTY. 


359 


:N0RT0N  v.  NEBRASKA  LOAN  &  TRUST 
CO. 

SAME  V.  TAYLOR  et  al.i 

(53  N.  W.  4SL  35  Xol).  4(>(>.) 

Supreme  Court  of  Nebraska.     Oct.  2(5,  1892. 

Error  to  district  court,  Butler  couuty;  I'ost, 
Jud>;e. 

Motion  by  W.  C.  Norton  against  Byron  E. 
Taylor  and  others  to  vacate  and  set  aside  a 
sale  of  land  on  a  decree  of  foreclosure  on 
the  jLiround  that  Norton  was  induced  to  make 
the  purchase  by  misrepresentations.  The  mo- 
tion was  overruled,  and  Norton  was  ordered 
to  pay  into  court  the  amount  of  his  bid.  To 
leverse  this  order,  he  brings  error.     Attlrmed. 

S.  S.  McAllister,  for  plaintiff  iu  error. 
Steele  Bros.,  for  defendants  in  error. 

NORVAL,  J.  The  Nebraska  Loan  &  Trust 
Company  brotight  suit  in  the  district  court 
of  Butler  county  against  Byron  E.  Taylor 
and  Lela  A.  Taylor,  his  wife,  to  foreclose  a 
mortgage  upon  the  S.  %  of  section  12,  in  town- 
-ship  15  N.,  of  range  1  E.,  executed  by  the 
'J'aylors,  which  mortgage  was  jmiior  and  sub- 
ject to  a  prior  mortgage  of  !f3,()(J0  on  said  real 
estate,  owned  and  held  by  one  AVashiugton 
Quinlin.  The  court  found  that  there  was  due 
the  loan  and  trust  company  on  its  mortgage 
the  sum  of  -f  1.05(5. (50;  that  said  Quinlin  had 
the  first  lien  on  said  premises  for  Jt^3,000,  with 
interest  thereon  at  (5  per  cent,  from  July  1, 
1888;  and  a  decree  of  foreclosure  was  ren- 
dered, which  directed  the  sale  to  be  made 
subject  to  the  lieu  of  Quinlin.  Subsequent- 
ly an  order  of  sale  was  Issued,  and  the  land, 
after  being  duly  appraised  and  advertised, 
was  sold  by  the  sheriff  to  one  W.  C.  Norton, 
the  p'.aintiff  in  error  herein,  for  the  sum  of 
$2,535.  The  sale  was  reported  by  the  sheriff 
to  the  court,  and  the  same  was  approved  and 
confirmed.  Shortly  thereafter,  at  the  same 
term  of  court,  the  purchaser  filed  a  motion 
to  vacate  and  set  aside  the  sale  on  the 
ground  that  he  was  induced  to  purchase  the 
property  by  reason  of  certain  representations 
made  by  the  sheriff  and  the  clerk  of  the  dis- 
trict court  as  to  the  character  of  the  title  the 
purchaser  would  acquire.  The  motion  was 
overruled,  and  Norton  was  ordered  to  pay  in- 
to court  tlie  amount  of  his  bid.  To  reverse 
said  order  Norton  prosecutes  a  petition  in  er- 
ror  to  this  court. 

It  appears  from  tlie  atfidavits  tiled  in  sup- 
port of  the  motion  to  set  the  sale  aside  that 
Mr.  Norton  came  to  the  place  where  the  sher- 
iff was  offering  the  property  for  sale,  and  in- 
quired wliat  lie  was  selling,  to  which  the  of- 
ficer replied  that  it  was  the  B.  E.  Taylor  land, 
and  requested  Norton  to  make  a  l)id  thereon; 
that  Norton  thereupon  asked  wliat  amount 
must  be  bid  to  get  the  land,  to  which  the 
sheriff  repl.ied  that  under  the  appraisement  it 
could  not  be  sold  for  less  than  i|;2,533.G0,  as 


1  L>isscutiug  opinion  of  Maxwell,  C.  J.,  omit- 
tea. 


that  was  two  thirds  of  the  appraised  value, 
and  that  by  paying  said  sum  he  would  ac- 
quire a  good  and  perfect  title  to  the  land,  free 
from  all  liens;  that  the  sheriff  and  Norton 
then  went  to  the  office  of  the  clerk  of  the  dis- 
trict court  to  ascertain  what  amount  was 
against  the  land,  and  the  clerk,  after  ex- 
amining the  papers,  told  Norton  he  w'ould 
have  to  bid  !l>2,533.tiU  to  get  the  land  l)ut  he 
had  better  make  the  bid  if2,535  even,  and 
tlieieby  get  a  little  above  two  thirds  of  the 
appraised  value;  that  the  payment  of  said 
sum  would  clear  the  land  of  all  prior  liens 
and  incumbrances;  that,  relying  upon  said 
statements,  Norton  made  a  bid  of  $2,5;55.  and 
the  land  was  struck  off  to  him  at  said  sum. 
On  the  next  day  the  sheriff,  on  meeting  Nor- 
ton, said  to  him  that  the  amount  of  his  bid 
was  not  two  thirds  of  the  appraisement;  that 
the  land  had  been  appraised  at  $4,800,  and 
could  not  be  sold  for  less  than  .$3,200,  and 
that  unless  Norton  would  raise  his  bid  to  said 
sum.  he  could  not  have  the  land,  whereupon 
Norton  replied  he  would  not  bid  the  sum  of 
$3,200.  and  the  sheriff  then  stated  that  such 
sale  must  be  declared  off.  It  also  appears 
that  the  statements  of  the  sheriff  and  clerk 
were  innocently  made  and  without  any  inten- 
tion to  mislead  or  deceive  the  purchaser.  It 
is  also  shown  by  uncontradicted  testimony 
that  the  land  was  well  worth  $(i,400. 

The  object  and  purpose  of  the  plaintiff  in 
error  is  to  set  aside  a  sheriffs  sale  on  the 
ground  that  he  did  not  thereby  acquire  the 
title  Avhich  he  at  the  time  supposed  he  was 
purchasing.  No  claim  is  made  that  either  the 
plaintiff  in  foreclosure  or  Taylor  or  his  wife 
was  guilty  of  any  fraud,  or  that  any  repre- 
sentations were  made  by  either  of  them  to 
Norton  as  to  the  character  of  the  title  to 
land,  or  that  they  had  any  knowledge  at  the 
time  of  the  purchase  of  the  statements  and 
representations  made  by  the  clerk  and  sher- 
iff. The  only  proposition  presented  is  whetli- 
er  the  fact  of  the  sheriff  and  clerk  having 
represented  to  Norton  that, .if  he  would  buy 
the  land,  he  would  get  a  clear  and  perfect 
title  thereto,  free  from  liens,  although  such 
representations  were  untrue,  was  sufficient 
to  require  the  court  to  set  aside  the  sale.  In 
our  view,  under  the  facts  disclosed  by  this 
record,  and  the  law  applicable  thereto,  plain- 
tiff in  error  is  not  entitled  to  any  relief.  Or- 
dinarily a  piuchaser  at  sheriff's  sale  takes  all 
risks.  He  buys  at  his  peril,  and,  if  the  title 
is  liad.  he  nuist  bear  the  loss.  The  rule  of 
caveat  emptor  applies  in  all  its  force  to  all 
judicial  sales.  The  coiu-t  undertakes  to  sell 
the  title  of  the  defendant,  such  as  it  is:  and 
it  is  the  duty  of  the  purchaser  to  ascertain  for 
himself  the  character  of  the  title  he  is  about 
to  acquire.  Miller  v.  Finn,  1  Neb.  254;  Smith 
V.  Painter,  5  Serg.  ^:  R.  (Pa.)  225;  Vattier  v. 
Lytle's  Ex'rs.  (5  Ohio,  478;  Lewark  v.  Car- 
ter, 117  Ind.  20(5,  20  N.  E.  119;  Corwin  v. 
Eenham.  2  Ohio  St.  3(5;  Mason  v.  Wait,  4 
Scam.  (111.)  127;  Bishop  v.  O'Conner.  (J9  111. 
431;    Sackett  v.  Twining,   57  Am.   Dec.  599; 


3G0 


WARRANTY. 


Lynch  v.  Baxter,  4  Tex.  431.  An  exception 
to  the  rule  above  stated,  recognized  by  tlie 
weij;lit  of  autliorities,  is  where  the  purchaser 
has  been  indut-ed  to  bid  by  fraud,  or  under  a 
mistake  of  fact.  A  purchaser  will  be  releas- 
ed from  the  sale  on  the  ground  of  a  mistake 
of  fact,  where  the  mistake  is  not  the  result  of 
his  own  negligence,  if  application  therefor  is 
made  at  the  proper  time;  but  he  will  not  lie 
released  from  his  purchase  on  his  mere  ignor- 
ance or  mistake  of  law.  Haden  v.  Ware,  15 
Ala.  141);  Burns  v.  Hamilton,  33  Ala.  210; 
Hayes  v.  Stiger,  29  N.  .1.  Eq.  19G;  Upham  v. 
HanuU,  11  K.  1.  otw.  The  facts  do  not  bring 
the  case  at  bar  within  the  exception  to  the 
rule,  so  as  to  entitle  Norton  to  have  the  sale 
set  aside.  Neither  the  clerk  nor  sheriff  mis- 
represented any  material  fact  concerning  the 
condition  of  the  title.  They  did  not  inform 
the  purchaser  that  there  were  no  incumbran- 
ces upon  the  property,  nor  does  Norton  claim 
that  he  was  not  aware  of  there  being  a  prior 
mortgage  of  $3,000  on  the  premises  at  the 
time  he  made  bis  bid.  The  clerk  and  sheriff 
supposed  that  the  sale  would  extinguish  all 
incumbrances,  and  that  the  purchaser  would 
acipiire  a  perfect  title  to  the  property.  In  so 
informing  Norton  they  misstated  the  law, 
or  the  legal  effect  of  the  foreclosure  pro- 
ceedings and  sale,  and  for  which  the  law  af- 
fords no  relief.  We  think  plaintiff  in  error 
is  concluded  by  his  own  neglect.  He  had  no 
right  to  rely  upon  tlie  statements  of  the  clerk 
and  sheriff,  but  should  have  had  the  title  and 
the  proceedings  under  which  the  sale  was 
made  examined  for  himself,  before  he  made 
his  bid.  Had  he  done  so,  he  would  have  been 
fully  apprised  of  the  condition  of  the  utle. 
The  records  of  the  county  and  of  the  court 
are  open  to  inspection  to  every  one.  and  these 
records  disclose  the  objection  now  urged  to 
the  title  of  the  lauds.  Had  an  examination 
Deen  made  of  either  the  petition  to  foreclose 
the  mortgage,  the  decree,  the  appraisement, 
certificates  of  liens,  or  notice  of  sale,  he 
would  have  ascertained  that  Washington 
(■iuinlin  had  a  first  Hen  upon  the  premi-ses  for 
.*i;3,(JU0  and  interest,  and  that  the  sale  was  to 
be  made  subject  thereto.  If  Norton  was  de- 
ceived, it  was  the  result  of  his  own  neghgence 
in  not  taking  the  precaution  to  examine  the 
records.  He  is  chargeable  with  knowledge  of 
th"ir  contents.  Equity  will  not  relieve  a  pur- 
chaser of  his  own  negligence.  Roberts  v. 
Hughes,  81  111.  ]30;  Vauscoync  v.  Kimler,  77 
111.  151;  Riggs  v.  Purcell.  (J(i  N.  Y.  193;  Pres- 
ton V.  Breckinridge,  8(3  Ky.  019,  (!  S.  W.  G41; 
White  V.  Weaver,  25  Barb.  (N.  Y.)  235;  Ec- 
cles  V.  Timmons,  95  N.  C.  540;  Weber  v. 
Herrick  (111.)  26  N.  E.  300;  Dennerleln  v. 
Dennerlein  (N.  Y.)  19  N.  E.  85. 

In  Eccles  v.  Timmons,  supra,  it  is  held  that 
a  purchaser  at  a  judicial  sale  will  not  be  re- 
leased fiom  his  bid  on  the  ground  that  the  ti- 
tle is  imperfect,  when  the  true  state  of  the 
title  is  set  out  in  the  pleadings  under  which 
the  sale  was  made.  Dennerlein  v.  Denner- 
lein (N.  Y.)  19  N.  E.  85,  was  a  partition  sale. 


The  property  was  described  in  the  proceed- 
ings and  in  the  notice  of  sale  by  metes  and 
bounds,  and  as  "containing  31  acres,  be  the 
same  more  or  less."  Prior  to  the  sale,  hand- 
bills were  issued  in  the  name  of  the  referee 
who  made  the  sale,  in  which  the  boundary 
lines  of  the  premises  were  omitted,  and  the 
property  described  as  the  farm  of  "the  late 
John  Dennerlein,  containing  31  acres."  The 
purchaser,  in  bidding  upon  the  property,  re- 
lied tipon  the  statement  in  the  handbills  as  to 
the  quantity  of  land.  Subsequently  he  dis- 
covered that  the  premises  only  contained 
2474  acres,  and  applied  to  the  court  for  an  or- 
der releasing  him  from  completing  the  pur- 
chase on  the  ground  that  he  had  been  misled 
as  to  the  ntimber  of  acres,  which  motion  was 
denied.  He  appealed  to  the  general  term 
where  the  order  was  affirmed  (46  Hun,  561), 
and  on  appeal  to  the  court  of  appeals  of  New 
York  it  was  held  that  he  was  not  entitled  to 
relief.  Yanscoyoc  v.  Kimler,  supra,  was  an 
appeal  from  an  order  of  the  circuit  court  sus- 
taining a  motion  made  therein  by  the  pur- 
chaser to  set  aside  a  sale  of  a  tract  of  land 
made  upon  execution,  on  the  ground  that  he 
was  led  to  believe,  by  misrepresentations 
made  by  the  officer  conducting  the  sale,  that 
the  land  was  not  incumbered,  when  in  fact 
it  was  mortgaged  in  excess  of  its  value.  The 
supreme  court  held  that  the  maxim  of  ca 
veat  emptor  applied,  and  that  the  misrepresen- 
tation of  the  sheriff  afforded  no  ground  for 
setting  aside  the  sale.  In  the  case  at  bar  the 
price  paid  was  so  greatly  inadequate  to  tlie 
real  value  of  the  land  as  to  put  the  purchaser 
on  incpiiry.  He  should  have  known  that  a 
half  section  of  Land,  which  the  evidence 
shows  was  well  worth  .1^6,400,  would  sell  for 
more  than  ij;2,535,- the  amount  of  his  bid,— 
if  there  was  no  prior  incumbrance.  The  land 
was  actually  worth  several  hundred  dohars 
more  than  the  amount  bid  by  Norton  and  the 
Qtiinliu  lien  combined,  so  that,  instead  of  los- 
ing anything  by  the  transaction,  the  invest- 
ment is  still  a  profitable,  one.  He  does  not 
complain  that  he  has  lost  anything  by  the 
transaction,  but  rather  that  he  failed  to 
dotible  on  the  investment. 

Concerning  what  took  place  between  the 
sheriff  and  Norton  the  day  following  the 
sale,  to  which  reference  has  been  made,  we 
will  say  that  it  is  unexplainable  how  the  for- 
mer made  the  statement  he  did,  if  correctly 
qtioted  in  Mr.  Norton's  affidavit,  in  regard  to 
what  the  land  was  appraised  at.  It  is  not 
true  that  it  had  been  appraised  at  !g4,800, 
and  could  not  be  sold  for  less  than  )t;3,200. 
The  sum  bid  by  Norton  was  more  than  two 
thirds  the  appraised  value  of  the  land  as 
shown  by  the  appraisement.  However,  what 
the  sheriff  may  have  said  in  that  regard,  as 
well  as  the  statement  that  "the  sale  must 
be  declared  off,"  is  of  no  importance,  for  the 
reason  that  the  status  of  Norton  as  purchas- 
er was  fixed  when  his  bid  was  accepted.  The 
officer  had  no  power  or  authority  to  after- 
wards reU  asc  hlui  from  his  purchase. 


WARRANTY. 


361 


It  is  contended  that  this  case  falls  within, 
and  is  controlled  l)j%  that  of  Paulett  v.  Pea- 
body,  3  Neb.  IIH),  and  Fraslier  v.  Inj^hara,  4 
Neb.  TiSl.  We  do  not  think  so.  These  cases 
were  decided  upon  facts  materially  different 
from  these.  In  the  first  case  there  was  a  de- 
cree of  foreclosure  of  a  junior  mortgage  in  a 
suit  Mherein  the  senior  mortgagee  was  not  a 
party.  The  property  was  sold  under  a  de- 
cree by  the  sheriff',  the  purchaser  being  in- 
duced to  buy  the  property  through  the  false 
representations  of  the  attorneys  of  both  the 
plaintiff'  and  the  senior  mortgagee  that  the 
prior  mortgiige  would  be  paid  off'  out  of  the 
proceeds  of  the  .sale,  and  that  he  would  take 
the  property  discharged  of  such  lien.  It  was 
held  that  said  false  representations  of  the 
parties  were  sufficient  grounds  for  vacating 
the  sale.  In  the  case  we  are  considering  it  is 
not  pretended  that  any  misrepresentations  or 
fraud  can  be  imputed  to  any  of  the  parties  to 
the  suit  or  to  Quinlin.  the  senior  mortgagee, 
wliereby  Norton  was  induced  to  buy  the  land. 
Of  course,  when  a  fraud  is  practiced  upon 
the  purchaser  at  a  judicial  sale  by  the  party 
in   interest,   which  induced   the  purchaser  to 


make  his  bid,  the  sale  will  be  set  aside  there- 
for. But  the  rule  has  no  application  here.  In 
the  case  reported  in  4  Neb.  '»?>!,  the  sheriff" 
levied  an  execution  upon,  appraised,  and  sold 
a  tract  of  land  coveied  with  timber.  The  .sale 
was  duly  conlirmed,  and  a  deed  executed  to 
the  purchaser.  Afterwards  it  was  discovered 
that  the  record  of  the  proceedings  under  the 
writ  described  another  tract,  near  by,  which 
was  of  no  value  whatever.  It  was  held,  on  a 
petition  of  the  purcliaser  to  set  aside  the  sale, 
that  he  was  entitled  to  relief.  Clearly  the 
case  is  not  analogous  to  the  one  before  us, 
for  in  this  case  there  was  no  error  in  describ- 
ing the  lands,  as  in  the  case  cited.  The  doc- 
trine announced  in  these  decisions  should  not 
be  extended  to  cases  not  clearly  of  their  class. 
We  are  of  the  opinion  that  the  district  court 
did  not  err  in  overruling  the  motion  of  the 
plaintiff  in  error  to  set  the  sale  aside,  and  its 
decision  is  affirmed. 

POST.  J.,  concurs. 

MAXWELL.   C.   J.,   dissenting. 


oC)2 


KIGHTS  OF  UNPAID  SELLER  AGAINST  THE  GOODS. 


PALMER  T.   HAND. 

(13  Johns.  434.) 

Supreme  Court  of  New  York.     Oct.  Term,  181G. 

This  was  an  actiou  of  trover,  tried  before 
-Mr.  Justice  Spencer,  at  tlie  Albany  circuit,  in 
April.  1S1(>. 

The  plaintiff  was  the  owner  of  a  raft,  con- 
sisting- of  plank,  joist,  and  boards;  and  whilst 
cominy  down  the  North  river,  in  the  autumn 
of  the  year  1815,  with  the  raft,  one  Potter 
.nine  upon  the  raft,  and  offered  to  buy  it; 
ilie  price  Avas  agreed  upon:  it  was  also 
a.i;reed.  that  the  plaintiff  should  deliver  it  at 
cue  of  the  docks  in  Albany,  and  be  at  the  ex- 
l>ense  of  takinjr  it  out  of  the  water.  Potter 
then  applied  to  the  defendant,  who  kept  a 
lumber-yard,  in  Albany,  to  purchase  the  lum- 
ber which  the  plaintiff  had  agreed  to  sell 
him;  but  Potter  and  the  defendant  not  being 
able  to  settle  the  bargain,  it  was  agreed  that 
The  defendant  should  take  and  sell  the  lum- 
Ikt.  The  plaintiff  arrived  with  his  raft,  the 
nexr  day.  and  brought  it  to  the  defendant's 
dock,  and  there  inquired  of  one  of  the  wit- 
nesses in  the  cause  for  Potter,  and  asked  if 
I'otter  was  not  to  have  more  hands  to  take 
out  and  pile  the  lumber,  and  said  that  he 
had  sold  it  to  Potter.  He  then  left  the  raft, 
and  went  into  the  city,  and  at  4  o'clock  in  the 
afternoon,  at  which  time  all  the  raft  was 
taken  out  of  the  water,  and  nearly  all  piled, 
a  few  QLiUing  pieces  excepted,  the  plaintiff 
returned  and  forbade  any  more  to  be  piled, 
saying  that  Potter  had  gone  off.  The  de- 
fendant, on  the  same  day,  advanced  to  Pot- 
ter, on  account  of  the  deposit  of  lumber,  lOO 
dollars;  and  also  gave  him  an  order  on 
^^'ilder  i\:  Hustings,  for  loO  dollars,  in  goods, 
which  were,  in  the  evening  of  the  same  day, 
delivered  to  him.  There  was  no  formal  de- 
livery of  the  lumber  to  Potter,  who,  it  was 
conceded,  was  a  cheat,  and  had  absconded. 
The  plaintiff  proved  a  deiuaud  on  the  defend- 
r.nt  to  restore  the  lumber,  or  pay  for  it,  and  a 
refusal.  The  .iuiy  found  a  verdict  for  the 
plaintiff,  subject  to  the  opinion  of  the  court, 
on  a  case  containing  the  above  facts. 

\':ni  Vechten,  for  plaintiff'.     Mr.  lb  iiry,  con- 

ti-;i. 

PL  ATT.  J.,  delivered  the  opinion  of  the 
coiu-t.  This  is  an  action  of  trover,  for  a 
quantity  of  plank  and  scantling.  It  appears 
that  the  plaintiff  was  owner  of  a  raft  of  lum- 
ber, and  while  descending  the  river  opposite 
to  Lansingburgh,  he  contracted  with  one  Pot- 
ter for  the  sale  of  the  lumber,  to  bt>  delivered 
to  Potter,  by  the  plaintiff",  on  one  of  the 
docks,  in  Albany,  at  a  price  agreed  on,  to  be 
l)aid  on  delivery.  Potter  then  went  to  the 
defendant,  who  keeps  a  lumber-yard  and 
dock,  at  Albany,  and  agreed  to  deliver  to  him 
the  lumber  of  that  raft,  to  be  sold  by  the  de- 
fendant, on  comiuission,  for  Potter. 

Next  morning,  about  sunrise,  the  plaintiff 
•irlved  with  the  raft,  and  fastened  it  to  the 


defendant's  dock.  The  plaintiff  then  tolci  the 
workmen  employed  there,  that  he  had  sold 
the  lumber  to  Potter.  One  or  two  men  be- 
gan immediately  to  pile  the  plank,  &c.,  on 
tlie  defendant's  dock,  and  the  plaintiff  "asked 
if  Potter  was  not  to  have  more  hands  to  take 
out  and  pile  the  lumber."  The  plaintiff" 
then  went  into  the  city,  and  did  not  return 
again  till  4  o'clock  P.  M.,  at  which  time  the 
lumber  was  almost  all  piled  on  the  defend- 
ant's dock.  The  plaintiff'  then  forbade  the 
piling  of  any  more,  saying  that  Potter  had 
absconded. 

While  the  men  wei'e  piling  up  the  lumber, 
about  10  or  11  o'clock  A.  M.  of  that  day,  the 
defendant  advanced  to  Potter  100  dollars, 
and,  also,  gave  an  order  for  150  dollars'  worth 
of  goods,  in  favor  of  Potter,  on  account  of 
the  deposit  of  lumber.  The  plaintiff,  after- 
wards, demanded  the  lumber,  which  the  de- 
fendant refused  to  deliver. 

There  is  no  doubt  that,  upon  a  contract  to 
sell  goods,  where  no  credit  is  stipulated  for. 
the  vendor  has  a  lien;  so  that  if  the  goods  be 
actually  delivered  to  the  vendee,  and,  upon 
demand  then  made,  he  refuses  to  pay,  the 
property  is  not  changed,  and  the  vendor  may 
lawfully  take  the  goods  as  his  own,  because 
the  delivery  was  conditional. 

As  between  the  vendor  and  vendee,  in  this 
case,  I  incline  to  the  opinion  that  the  proper- 
ty In  the  lumber  was  not  so  vested  in  the 
vendee  as  that  the  vendor  could  not  legally 
have  resumed  it  when  he  came,  in  the  after- 
noon, and  forbade  the  piling  of  any  more 
of  it. 

The  contract  with  Potter  was  for  the  whole 
raft,  to  be  delivered  on  the  dock.  The  ven- 
dor, therefore,  had  no  right  to  demand  pay- 
ment for  any  part  until  the  whole  was  deliv- 
ered; and  it  appears  that  he  came  to  the 
place  of  delivery,  at  4  o'clock  in  the  after- 
noon of  the  day  on  which  the  raft  arrived  at 
the  dock,  whilst  the  lumber  was  still  in  the 
course  of  delivery,  and  signified  his  deter- 
mination not  to  consider  the  sale  as  absolute. 
He  said  that  Potter  had  absconded,  and  or- 
dered the  men  not  to  pile  any  more  of  the 
plank,  &c.  As  between  Palmer  and  Potter 
there  was  no  such  delay  or  acquiescence  on 
the  part  of  the  vendor,  as  would  be  evidence 
of  a  credit  given  for  the  money.  If  the  ven- 
dor was  there,  and  demanded  payment,  as 
soon  as  the  whole  lumber  was  piled  on  the 
dock,  that  was  enough  to  preserve  his  lien; 
and  such.  I  think,  is  the  fair  construction  of 
the  evidence. 

The  plaintiff",  in  this  cavse,  seeks  to  enforce 
his  lien  against  a  person  who  has  bona  tide 
received  the  property  as  a  pledge  for  money 
and  goods  advanced  to  Potter,  to  nearly  the 
amount  of  its  value.  Those  advances  Avere 
made  b.v  the  defendant  while  the  lumber  was 
in  a  course  of  delivery  on  the  dock,  and  before 
the  plaintiff"  asserted  his  claim  to  it.  But 
there  is  no  evidence  that  the  plaintiff  had 
any  knowledge  of  the  negotiations  between 
Potter  and   the  defendant,    in   regard   to   the 


RIGHTS  OF  UNPAID  SELLER  AGAINST  THE  GOODS. 


3G3 


lumber,  until  after  the  plaiutiff  had  made 
liis  election  to  rescind  his  contract  with  Pot- 
ter. This  is  a  contest,  then,  between  two 
honest  men,  who  sliall  be  the  dupe  of  a 
-swindler.  The  strict  rule  of  law  must,  there- 
fore, bo  applied;  and  the  defendant  cannot 
3)6  allowed  to  stand  in  a  more  favorable  situ- 


ation than  I'otter  wcnUd  have  been  in  if  he 
himself  had  withlield  the  possession  of  the 
lumber,  without  paying  the  price  when  de- 
manded. 

We  are,  therefore,  of  opinion,  that  the 
plaintiff  is  entitled  to  judgment. 

Judgment  for  the  plaintiff. 


564 


RIGHTS  OF  UNPAID  SELLER  AGAINST  THE  GOODS. 


BENEDICT   V.    SCHAETTLE. 

(12  Ohio  St.  515.) 
Supreme  Court  of  Ohio.    Dec.  Term,  18G1. 
Error  to  the  superior  court  of  Cincinuatl. 
Stallo  &  M'Cook,  for  phiintiff  in  error.    Keb- 
ler  «fc  Force,  for  defeudaut  iu  error. 

GHOLSON,  .1.  Accordiuj;  to  the  decision 
in  House  v.  Elliott,  0  Ohio  St.  407,  which  ap- 
plies iu  this  case,  we  can  not  inquire  as  to 
the  weight  of  evidence  on  which  auj'  finding 
of  fact  was  made  in  the  court  below.  The 
liudiug  must  be  against  law.  Assuming  everj' 
fact  which  the  evidence  may  tend  to  prove,  in 
support  of  the  finding  and  judgment  of  the 
court  below,  do  those  facts  fail  to  establish 
the  right  of  the  plaintiff  in  the  action  to  re- 
cover? We  need  not,  therefore,  say  whether 
there  was  sufficient  evidence  lo  snow  tnat 
Johnson,  to  whom  the  goods  were  sold,  was 
insolvent.  There  was,  we  think,  evidence 
tending  to  show  the  insolvency  of  the  vendee 
at  the  time  of  the  sale  of  the  goods,  and  that 
such  insolvency  was  not  known  to  the  ven- 
dor. The  question  then  arises,  whether  the 
vendor,  on  afterward  hearing  of  the  insolven- 
cy, may  f-xercise  the  right  of  stoppage  in 
transitu,  or,  whether,  as  claimed  by  counsel 
for  the  plaintiff  in  error,  the  insolvency,  to  au- 
thorize a  stoppage  in  transitu,  must  be  evi- 
denced by  some  positive  overt  act,  the  exist- 
ence of  which  is  not  inferable  from  any  testi- 
mony in  the  bill  of  exceptions,  and  that  such 
overt  act  must  occur  after  the  sale,  and  before 
the  delivery  of  the  goods? 

It  is  the  rule  of  the  mercantile  law,  that 
where  goods  have  been  consigned,  and  are  on 
transit  to  the  vendee,  the  consignor  can  not 
vary  the  consignment,  except  in  the  case  of 
insolvency.  It  has  been  said,  that  "the  mis- 
chief and  inconvenience  that  would  ensue  on 
•  a  contrary  supposition,  are  extreme.  The 
goods  might  be  put  on  board,  and  might  lie 
at  the  risk  of  the  consignee  for  two  or  three 
mouths;  and  if  the  consignor  could  come  and 
resume  them  at  pleasure,  it  would  place  the 
consignee  in  a  situation  of  great  disadvantage, 
that  he  should  be  exposed  to  the  risk  during 
such  a  length  of  time,  for  an  object  which 
might  be  eventually  defeated,  at  any  moment, 
by  the  capricious  or  interested  change  of  in- 
tention in  the  L)reast  of  the  consignor.  It 
would  be  to  expose  the  consignee  altogether  to 
the  mercy  of  the  seller."  The  Constantia.  6 
C.  Rob.  Adm.  .321-327.  In  that  case,  the  ven- 
dor had  stopped  and  diverted  the  delivery  of 
goods,  and  it  was  said,  if  the  vendee  "had 
been  an  insolvent  person,  it  would  have 
amounted  to  a  complete  and  effective  revendi- 
catiou  of  the  goods.  But  if  the  person  to 
whnm  they  are  consigned  is  not  insolvent;  if 
from  misinformation  or  excess  of  caution,  the 
vendor  has  exercised  this  privilege  premature- 
ly, he  has  assumed  a  right  that  did  not  belong 
to  him,  and  the  consignee  will  be  entitled  to 
the  delivery  of  the  goods,  with  an  indemnifica- 


tion for  the  expenses  that  have  been  incurred. 
*  *  *  It  is  not  an  unlimited  power  that  is 
vested  in  the  consignor,  to  vary  the  consign- 
ment at  his  pleasure  in  all  cases  whatever.  It 
is  a  privilege  allowed  to  the  seller,  for  the  par- 
ticular purpose  of  protecting  him  from  the  in- 
solvency of  the  consignee.  Certainly  it  is  not 
necessary  that  the  person  should  be  actuallj' 
insolvent  at  the  time.  If  the  insolvency  hap- 
pen before  the  ai  rival,  it  would  be  sufficient 
to  justify  what  has  been  done,  and  to  entitle 
the  shipper  to  the  benefit  of  his  own  provi- 
sional caution.  But  if  the  person  is  not  in- 
solvent, the  ground  is  not  laid  on  which  alone 
such  a  privilege  is  founded."  6  C.  Rob.  Adm. 
32(j.  In  the  case  of  Wilmshurst  v.  Bowker,  2 
Man.  &  G.  792,  812,  it  was  said  by  Tindal,  C. 
J.:  "The  ordinary  right  of  countermanding 
the  actual  delivery  of  goods  shipped  to  a  con- 
signet,  is  limited  to  the  cases  in  which  the 
bankruptcy  or  insolvency  of  the  consignee  has 
taken  place.  The  law  as  to  this  point  is  very 
clearly  laid  down  by  Lord  Stowell,  in  the  case 
of  The   Constantia." 

This  statement  of  the  doctrine  of  stopjnige 
in  transitu,  which  is  supported  by  such  high 
authorities,  does  not  sustain  the  proposition, 
that  a  vendee,  insolvent  at  the  time  of  the 
sale  of  goods,  and  still  remaining  insolvent, 
can  object  to  their  stoppage  in  transitu.  He 
could  only  complain  when  his  insolvency  was 
known  to  the  vendor  at  the  time  of  sale,  and 
the  contract  was  made  in  view  of  such,  his 
condition.  The  object  in  allowing  the  priv- 
ilege to  the  vendor  being  his  protection  against 
the  insolvency  of  the  vendee,  such  privilege, 
unless  waived  by  the  vendor,  ought  properly 
to  extend  to  cases  of  insolvency,  whether  ex- 
isting at  the  time  of  sale  or  occurring  at  any 
time  before  the  actual  delivery  of  the  goods. 
A  vendee  who  disputes  the  right  of  stoppage 
in  transitu,  must  be  prepared  to  aver,  as  in 
the  case  of  Wilmshurst  v.  Bowker,  2  Man.  & 
G.  792,  which  was  an  action  by  a  vendee 
against  a  vendor  for  improperly  stopping  the 
delivery  of  goods,  that  he  was  neither  bankrupt 
nor  insolvent.  Independently  of  any  circum- 
stances to  the  contrary,  the  vendee  might 
have  the  benefit  of  a  presumption  of  ability  to 
comply  with  his  contract,  and  the  burden  of 
shewing  insolvency  might  be  cast  on  the  ven- 
dor. It  may  be  that  this  would  be  sutfi- 
ciently  shown  by  the  proof  of  an  overt  act  of 
insolvency,  such  as  a  stoppage  of  payment, 
though,  in  fact,  an  actual  insolvency,  iu  the 
sense  of  not  having  means  adequate  to  the 
payment  of  debts,  might  not  exist.  If  the  ven- 
dee, before  the  steppage  in  transitu,  had.  by 
his  conduct  in  business,  afforded  the  ordinary 
apparent  evidences  of  insolvency,  he  ought  not 
to  complain  of  the  precautionary  measure  tak- 
en by  the  vendor,  though  it  should  turn  out 
that  he  was  ultimately  able  to  pay.  But, 
though  no  such  evidences  of  insolvency  should 
precede  the  stoppage  iu  transitu,  still,  if  the 
fact  of  insolvency  existed  the  vendee  ought 
not  to  complain.     This,  at  least,  is  clearly  to 


RIGHTS  OF  UNrAlD  SELLER  AGAINST  THE  GOODS. 


365 


be  inferred  from  the  language  of  the  author- 
ity which  has  been  cited,  and  appears  entirely 
reasonable  and  proper.  Fair  dealing  will  De 
better  insured  by  leaving  to  the  vendor  his 
privilege  of  stoppage  in  transitu,  in  all  cases 
of  insolvency,  whether  evidenced  by  the  ordi- 
nary accompanying  acts,  or  shown  actually 
to  exist.  The  rights  of  a  fair  vendee  will  be 
sufficiently  protected  by  giving  him  an  indem- 
nity when  the  right  of  stoppage  in  transitu  is 
exercised  upon  rumor  or  suspicion  without 
any  foundation  in  fact,  and  by  depriving  the 
vendor,  in  all  cases,  of  any  chance  of  speculat- 
ing upon  the  goods,  by  requiring  them  to  be 
delivered  or  accounted  for  to  the  vendee,  or 
his  assignee,  on  the  payment  or  tender  of  the 
agreed  price. 

These  views  are  sustained  by  the  origin  and 
nature  of  the  doctrine  of  stoppage  in  transitu. 
It  appears  to  have  been  derived  from,  or  to 
be  analogous  to,  the  revendication  of  the  civil 
law.  This  has  been  tlius  defined:  "Revendi- 
cation is  the  right  of  an  unpaid  vendor,  upon 
the  insolvency  of  the  vendee,  to  reclaim,  in 
specie,  such  part  of  the  goods  as  remains  in 
the  hands  of  the  vendee  entire,  and  without 
having  changed  its  quality."  In  re  Westzyn- 
thlus,  2  Nev.  &  Man.  650,  note.  In  Bell's 
Commentaries  on  the  Laws  of  Scotland,  cited 
in  the  same  case,  it  is  said:  "The  privilege 
to  stop  goods  in  transitu,  is  a  qualitied  exten- 
sion in  equity  of  that  rule  of  mutual  contract, 
by  which,  either  party  may  withhold  perform- 
ance, on  the  other  becoming  unable  to  per- 
form his  part."  It  is  stated,  as  a  rule  intro- 
duced into  the  conniion  law,  in  modern  times, 
founded  on  principles  of  equity,  and  borrowed 
from  the  foreign  or  continental  law,  that  in 
case  of  the  vendee's  bankruptcy  or  insolvency, 
the  vendor  might  stop  and  take  back  the  goods 
in  transitu,  or  before  they  come  into  the 
hands  of  the  vendee.  Bell.  Comm.  bk.  2,  pt. 
2,  c.  1,  art.  3,  cited,  2  Nev.  &  Man.  (>51.  6:>2, 
note;  ^Nlaekreth  v.  Symmons.  15  Ves.  343.  It 
is  "nothing  more  than  an  extension  of  the 
right  of  lien,  which,  by  the  common  law,  the 
vendor  has  upon  the  goods  for  the  price,  orig- 
inally allowed  in  equity,  and  subsequently 
adopted  as  a  rule  of  law."  Rowley  v.  Bige- 
low,  12  Pick.  307,  313:  Atkins  v.  Colby,  20  N. 
H.  1.54;  Grout  v.  Hill,  4  Gray,  3r.l.  "A  kind 
of  equitable  lien  adopted  by  the  law  for  the 
purposes  of  substantial  justice."  Hodgson  v. 
Loy,  7  Term  R.  445.  In  the  case  of  McEwan 
v.  Smith,  2  H.  L.  Cas.  300,  328,  it  was  said, 
by  Lord  Campbell,  that  "the  do<^'trine  of 
stoppage  in  transitu  is  a  most  just  and  eqtiita- 
ble  one,  and  I  would  by  no  means  strive  to 
limit  its  operation." 

If  the  true  principle  of  the  right  of  stopi)age 
in  transitu  be  found  in  that  certainly  just  rule 
of  mutual  contract,  by  which  either  party  may 
withhold  performance,  on  the  other  becoming 
unable  to  perform,  on  his  part;  if  the  founda- 
tion of  the  rule  be  a  just  lieu  on  the  goods  for 
the  price,  until  delivered,  an  equitable  lien 
adopted  for  the  purposes  of  substantial   jus- 


tice, then,  it  is  the  abilitj*  to  perform  the  con- 
tract— to  pay  the  price — which  is  the  material 
consideration.  If  there  be  a  want  of  ability, 
it  can  make  no  difference  in  justice  or  good 
sense,  whether  it  was  produced  by  causes,  or 
shown  by  acts,  at  a  period  before  or  after  the 
contiact  of  sale.  Substantially,  to  the  ven- 
dor who  is  about  to  complete  delivery,  and 
abandon  or  lose  his  proprietary  lien,  the  ques- 
tion is,  can  the  vendee  perform  the  contract 
on  his  part;  has  he,  from  insolvency,  become 
unable  to  pay  the  price?  If  such  be  his  con- 
dition, and  the  vendor  has  not  precluded  him- 
self by  some  act  of  waiver,  the  general  prin- 
ciples on  the  subject  and  justice  require  tliat 
he  should  be  allowed  to  exercise  the  right  of 
stoppage  in  transitu. 

To  sustain  the  contrary  view  and  limit  the 
right  of  stoppage  in  transitu,  the  case  of  Rog- 
ers V.  Thomas,  20  Conn.  53,  is  relied  on,  in 
which  it  was  decided,  that  to  authorize  the 
exercise  of  the  right  of  stoppage  in  transitu, 
there  must  be  some  overt  act  of  insolvency, 
and  that  it  must  intervene  between  the  sale 
and  the  exercise  of  the  right.  The  decision  in 
the  case  of  Rogers  v.  Thomas,  was  not  made 
on  the  authority  of  previous  cases,  but,  in  the 
absence  of  such  cases,  upon  the  ground  that 
the  general  definitions  or  statements  of  the 
doctrine  of  stoppage  in  transitu  required  such 
a  limit  to  the  exercise  of  the  ngnt;  and  par- 
ticular reference  is  made  to  the  general  state- 
ment of  the  doctrine  in  Smith,  Merc.  Law,  547 
(Am.  Ed.  G77).  The  very  first  authority  cited 
by  Mr.  Smith  to  sustain  his  statement  of  the 
doctrine,  is  the  case  of  Wilmshurst  v.  Bow- 
ker,  and  he  quotes  the  remarks  of  Tindal,  C. 
.1..  as  to  the  clearness  with  whicli  the  law  on 
the  point  had  been  laid  down  by  Lord  Stowell 
in  the  ease  of  The  Constantia.  Interpreting  the 
statement  of  the  doctrine,  by  INIr.  Smith,  in 
the  light  of  the  authorities  he  cites,  and  it  is 
manifest  that  he  never  intended  any  such' 
limit  to  the  exercise  of  the  right  of  stoppage 
in  transitu.  Nor  do  we  think  the  terms  in 
which  the  doctrine  of  stoppage  in  transitu  is 
stated  in  many  of  the  authorities,  would  jus- 
tify the  limit  supposed  to  exist. 

It  was  said  by  Lord  Kenyon,  in  Ellis  v. 
Hunt,  3  Term  R.  407,  that  "the  doctrine  of 
stopping  goods  in  transitu  is  bottomed  on  the 
case  of  Snee  v.  Prescot,  1  Atk.  245,  where 
Lord  Hardwicke  established  a  very  wise  nde, 
that  the  vendor  might  resume  the  possession 
of  goods,  consigned  to  the  vendee,  before  de- 
livery, in  case  of  the  bankruptcy  of  the  ven- 
j  dee." 

The  doctrine  is  thus  stated  by  Lord  Hard- 
wicke. After  referring  to  the  rule,  that  an 
action  against  a  carrier  for  loss  of  goods 
should  1)e  brought  in  the  name  of  the  con- 
.signee.  he  proceeds:  "But  suppose  such  goods 
are  actually  delivered  to  a  carrier,  to  be  de- 
livered to  A.,  and  while  the  carrier  is  upon 
the  road,  and  before  actual  delivery  to  A.,  by 
the  carrier,  the  consignor  hears  A.,  his  con- 
signee, is  likely  to  become  bank'-upt,  or  is  ae- 


366 


RIGHTS  OF  IXrUI)  SELLER  AGALXST  THE  GOODS. 


tiially  ono,  anil  couutennauds  tin-  ileliveiy. 
iiud  gets  them  back  in  his  own  ixjssession 
again.  I  am  of  opinion  tliat  no  action  of  tro- 
vur  would  lie  for  tlie  assignees  of  A.,  because 
the  goods,  while  they  were  in  transitu,  miglit 
be  so  counteiinanded."'  Snee  v.  IMescot.  1 
Atk.  248. 

In  a  case  before  cited  it  is  said  by  Lord 
Canipbell:  "What  is  stoppage  in  transitu? 
It  is  tlds.  that  where  a  vendor  of  goods  lias  to 
send  tliem  to  a  vendee,  and  has,  for  that  pui- 
posi'.  parted  from  them  to  a  carrier,  he  may, 
upon  hearing  of  the  insolvency  of  the  vendee, 
while  tliey  remain  in  the  hands  of  the  carrier, 
and.  before  delivery  to  the  purcliaser.  stop 
tlieir  delivery."  McEwan  v.  Smitli,  2  H.  L. 
Oas.  328. 

In  the  case  of  Donath  v.  Broondiead.  7  Pa. 
St.  .oOl.  303,  it  is  said:  "The  right  of  a  ven- 
dor, on  the  discovery  of  the  bankruptcy  or  in- 
solvency of  the  party  to  whom  lie  has  sold 
goods  on  credit,  to  retake  them  before  actual 
or  complete  delivery,  is  the  Avell-settled  doc- 
trine of  both  courts  of  law  and  e(piity." 

In  the  case  of  Hays  v.  :Mouille,  14  Pa.  St. 
48.  tlie  .iudge.  In  his  charge  to  the  jury  (and 
his  views  were  expressly  adopted  by  the  court 
of  error.)  after  stating  that  the  insolvency  of 
the  vendee  was  the  ground-work  of  the  plain- 
tiff's claim,  thus  put  tlie  (piestion— Was  the 
vendee  "insolvent  when  these  goods  Avere  re- 
plevied by  the  plaintiffs?  It  is  not  necessary, 
to  prove  insolvency,  that  he  slicmld  have  been 
declared  a  bankrupt  or  insolvent  l)y  a  judicial 
tribunal,  nor  that  he  should  have  made  an  as- 
signment of  liis  property.  If  the  fact  exist, 
no  matter  how  proved,  if  sufficiently  and  sat- 
isfactorily proved,  the  law  requires  no  more." 
In  that  case  the  evidence  tended  to  sliow  that 
the  vendee  was  insolvent  when  tlie  goods  were 
bought,  and  the  judge  further  said:  "You 
have  the  testimony  of  Baker  tliat  Uliodes  was 
indebted  some  .^(»0.tM)0.  and  that  his  assets 
were  but  $2G.0OO.  and  that  his  c-reditors  were 
watching  for  these  goods  on  tlie  line  of  trans- 
jHirtation.  and  actually  attaclied  them  before 
tliey  reached  Ohio,  for  del)ts  wliicli  he  was  not 
able  to  pay." 

In  the  case  of  Stevens  v.  Wliecler.  27  Barb. 
(i.")S,  GG3,  there  is  this  statement  of  the  rules 
on  the  sul)ject  of  stoppage  in  transitu:  "That 
tlie  vendor  has  a  right  to  stop  goods  sold  by 
him.  when  he  discovers  the  vendee  to  be  in- 
solvent, at  any  time  while  the  goods  are  in 
transitu.  Tliat  the  transitus  continues  until 
the  goods  reach  the  place  of  destination,  un- 
less sooner  terminated  by  the  act  of  the  ven- 
dee. That  a  delivei-y  to  the  vendee  of  tlie 
goods,  or  a  part  of  them,  or  a  delivi-ry  to  his 
agent  or  to  a  bona  fide  purchaser  from  him, 
terminates  the  right  of  tlie  vendor  of  the 
goods  to  stop  them." 

Not  only  do  the  general  statements  of  tTie 
doctrine  fall  short  of  sustaining  the  decision 
in  Rogers  v.  Thomas,  but.  in  several  cases, 
where  the  question  was  involvtMl.  it  was  dif- 
ferently  decided.     Such,    we    tliiuk,    was   the 


case  of  Hays  v.  Mouille.  14  Pa.  St.  48,  before- 
noticed.  There  it  is  evident,  the  insolvency 
existed  at  the  time  of  the  sale  of  the  goods. 
and  it  was  proved,  not  by  any  overt  act,  but 
by  a  conipariscn  of  the  amount  of  liabilities 
witli  the  amount  of  assets. 

Tlie  decision  in  the  ca.se  of  Bucldey  v.  lur- 
ni.ss.  1.")  Wend.  137,  appears  to  be  directly  op- 
posed to  that  in  Rogers  v.  Thomas.  In  Buck- 
ley V.  Furniss,  the  point  was  made  that  the 
vendor,  at  the  time  of  the  sale,  knew  the  cir- 
cumstances of  the  vendee,  who  was  then 
insolvent.  It  was  said  by  Bronson,  ,T.:  "TIk^ 
sale  was  no  doubt  absolute,  whether  the  plain- 
tiff knew  tliat  Titus  was  insolvent  or  not;  and 
so  are  most  sales,  where  the  vendor  after- 
ward exercises  the  right  of  stoppage  in  tran- 
situ. The  right  of  the  vendor  to  I'esume  pos- 
session of  goods  sold  on  credit,  in  ca.se  of  the 
insolvency  of  the  consignee,  before  they  come 
to  his  hands,  does  not  depend  upon  any  condi- 
tion, or  other  peculiarity  in  the  contract  of  sale, 
but  proceeds  on  the  ground  of  an  equitable- 
lien.  Still,  it  may  be,  and  probably  is  true, 
that  if  the  plaintiff  sold  the  iron,  with  a  fult 
knf>wle(lge  of  the  situation  of  the  vendee,  he 
could  not  afterwards  exercise  the  right  of  stop- 
page in  transitu;  but  the  argument  is  not 
borne  out  by  the  facts."  The  judge  then  pro- 
ceeds to  show  by  a  reference  to  the  facts,  that 
although  the  vendee  was  insolvent  at  the 
time  of  the  sale,  it  was  not  known  to  the  ven- 
dor, who.  therefore,  had  the  right  to  retake 
the  goods.  This  case  was  cited  by  counsel,  in 
Rogers  v.  Thomas,  but  was  not  noticetl  in  the 
opinion  of  the  court. 

There  are  other  cases  in  which  the  decision 
did  not  turn  on  the  question  of  insolvency, 
the.  contest  in  this  class  of  cases  having  gen- 
erally been  as  to  the  termination  of  the  tran- 
sit; but  whei'e  it  appears  either  directly  or- 
by  strong  inference,  that  the  insolvency  ex- 
isted at  the  time  of  sale.  Such  a  case  is 
Biggs  V.  Barry.  2  Curt.  2.j9,  Fed.  Cas.  No.  1,- 
402,  in  which  it  clearly  appears  that  the  in- 
solvency existed  at  the  time  of  sale;  but  the- 
case  was  given  to  the  jury  on  the  question, 
simply,  whether  the  transit  had  ended,  witl.<- 
out  any  reference  to  the  time  of  insolvency. 

In  the  cases  of  Stubbs  v.  Lund.  7  Mass.  4.53. 
and  Ilsley  v.  Stubbs.  9  ^lass.  G.j,  what  was- 
regarded  by  the  court  as  the  sale  of  the  goods,, 
their  shipment  on  order,  was  after  the  in- 
solvency of  the  vendee,  and  yet  the  exercise- 
of  the  right  of  stoppage  in  transitu  Avas  sus- 
tained. 

The  point  might  liave  been  made,  and  if  sils- 
tained  would  ha^e  changed  the  decision  in 
the  case  of  ^itt  v.  Cowley.  1  Holt.  338,  3  E. 
C.  L.  138,  as  is  shown  by  Waite,  .!.,  in  his  dis- 
senting opinion  in  the  case  of  Rogers  v.  Thom- 
as. It  may  not  be  conclusive  against  the  cor- 
rectness of  a  legal  proposition,  that  it  was  not 
presented,  when  from  the  facts  involved  it 
might  have  been.  But  when  this  has  occurred 
in  a  number  of  cases,  where  it  is  to  be  sup- 
posed that  both  counsel  and  couit  are  Avell  in- 


RIGHTS  OF  UNPAID  SELLER  AGALNST  THE  GOODS. 


i>G7 


I'oiund  as  to  the  niles  of  law,  it  is  a  reasou- 
ahle  inference  tliat  tlie  point  was  not  made 
because  it  was  deemed  uuteualile. 

We  have  not  been  able  to  tiud.  and  oiu'  atten- 
tion has  not  been  calle<l  by  counsel  to  any  de- 
cision which  sustains  the  restriction  on  the 
light  of  stoppage  in  transitu  laid  down  in 
Rogers  v.  Thomas;  but  it  has  been  adopted 
as  a  rule  of  law  in  several  elementary  works. 
It  appears  to  be  approved  in  1  Pars.  Cont.  47G. 
4TS,  but  that  approbation  is  omitted  in  the 
work  nf  Tlie  s;uiie  author  on  Mercantile  Law. 


and  witlidrawu,  and  a  grave  doubt  substitutetl, 
in  his  more  recent  work  on  Maritime  Law, 
volume  1,  p.  3(J!). 

We  are  satisfied  that  the  restiiction  can  not 
be  maintained  either  on  principle  or  aurnority. 

In  accordance  with  the  views  which  have 
been  expressed,  the  judgment  of  the  superior 
court  of  Cincinnati  will  be  atJirmed. 

Judgment  affirmed. 

ST'TLIFF.  ('.  .L.  and  PECK.  KRIXKER^ 
IK^FF.  and  SCOTT.  .I.I..  rdUcurred. 


368 


RIGHTS  OF  UNPAID  SELLER  AGAINST  THE  GOODS. 


JONES  V.  EARL. 

(37  Cal.  (>W.) 
Supreme  Court  of  Califoruia.     July,   1SG9. 

Appeal  from  the  district  court,  sixth  .iiuli- 
cial  district.  Sacraiucuto  county. 

The  action  was  against  a  forwarder  for  the 
conversion  of  jioods.  The  following,'  is  a  copy 
of  the  letter  which  is  referred  to  in  th(>  opin- 
ion of  the  court: 

"Sau  Francisco,  November  ISth.  1S(!7. 
Messrs.  D.  W.  Earl  &  Co.:  Gents— On  the 
eleventh  instant  we  shipped  to  your  care  the 
following  .ijoods,  viz.:  Two  barrels  wljisky. 
Two  ca.sks  ale.  Two  casks  porter.  Four 
baskets  chanipa.iine.  Four  cases  Ilostetter's 
bitter.s.  Marked:  F.  M.  A..  Virj;inia  City. 
Care  'Earl,'  Cisco. 

"If  the  goods  liave  not  been  forwarded  yet 
from  Cisco,  please  hold  on  to  them  till  you 
hear  from  us  again,  as  the  party  to  whom  they 
were  consigned  at  Virginia  has  been  attached, 
and  we  want  to  save  the  goods.  If  they  have 
been  forwarded  from  Cisco,  please  instruct 
your  agent  at  Virginia  to  deliver  the  goods  to 
no  one  but  our  agent,  Mr.  J.  A.  Byers,  who 
will  be  at  Virginia  on  the  lookout  for  the 
goods.  Flease  write  us  immediately  whether 
the  goods  have  been  sent;  if  not,  Mr.  Byers 
will  call  for  them  at  Cisco.  Veiy  respectful- 
ly. Biggs  &  Jones." 

Coffroth  &  Spaulding.  for  appellant.  M.  A. 
Wheaton,  for  respondent 

SANDERSON.  J.  Stoppage  in  transitu  is 
a  right  whica  the  vendor  of  goods  upon  credit 
has  to  recall  them,  or  retake  them,  upon  the 
discovery  of  the  insolvency  of  the  vendee,  be- 
fore the  goods  have  come  imo  his  possession, 
or  any  third  party  has  acquired  bona  fide 
rights  in  them.  It  continues  so  long  as  the 
carrier  remains  in  the  possession  and  control 
of  the  goods,  or  until  there  has  been  an  actual 
or  constructive  delivery  to  the  vendee,  or 
some  third  person  has  acquired  a  bona  fide 
right  to  them.  Upon  demand  l)y  the  vendor, 
while  the  right  of  stoppage  in  transitu  con- 
tinues, the  carrier  will  l)ecome  liable  for  a  con- 
version of  the  goods,  if  he  decline  to  redeliver 
them  to  the  vendor,  or  delivers  them  to  the 
vendee.  Markwald  v.  His  Creditors.  7  Cal. 
213;    Blackmau  v.  Pierce.  23  Cal.  .508;  O'Neil 


V.  Garrett,  6  Iowa.  480;  Reynolds  v.  Rail- 
road Co.,  43  N.  H.  580.  And  a  notice  by  the 
vendor,  without  an  express  demand  to  rede- 
liver the  goods,  Is  sutficient  to  charge  the 
carrier.  If  tlie  carrier  is  clearly  informed  that 
it  is  the  intention  and  desire  of  the  vendor  to 
exercise  his  right  of  stoppage  in  transitu,  the 
notice  is  sufficient.  Reynolds  v.  Railroad  Co., 
supra;  Lift  v.  Cowley.  7  '1  aunt.  IG!);  White- 
head V.  Anderson,  9  Mees.  &  W.  olS;  Bell  v. 
Moss,  ij  Whart.  IS'J.  And  notice  to  the  agent 
of  the  carrier,  who  in  the  regular  course  of 
his  agency  is  in  the  actual  custody  of  the  goods 
at  the  time  the  notice  is  given,  is  notice  to 
the  carrier.    Bierce  v.  Hotel  Co.,  31  Cal.  160. 

The  case  made  by  the  record  shows  that  the 
goods  in  question  were  consigned  to  the  care 
of  the  defendant  at  Cisco,  to  be  forwarded  by 
him  in  the  usual  course  of  business  to  the 
vendee  at  Virginia  City.  That  the  defendant 
was  engaged  in  the  forwarding  business  at 
Sacramento,  and  had  an  agent  at  Cisco  whose 
business  it  was  to  receive  all  goods  shipped 
to  the  care  of  defendant,  and  deliver  them  to 
the  order  of  the  vendee  upon  payment  of  char- 
ges and  commi.-isions.  That,  while  the  goods 
were  at  Cisco  and  in  the  custody  of  the  de- 
fendant's agent,  who  had  full  charge  of  the 
forwarding  business  at  that  place,  a  letter 
from  the  plaintiff,  addressed  to  the  defendant 
at  Cisco,  containing  a  bill  of  the  goods,  and 
inlorming  the  defendant  that  the  vendee  had 
been  attached,  and  that  he  want-'d  to  save 
the  goods,  and  directing  the  defendant  not  to 
deliver  the  goods  to  any  one  except  his  (the 
plaintin's)  agent  at  Virginia,  who  would  be 
looking  out  for  them,  was  received  by  the 
defendant's  agent  at  Cisco.  That  the  defend- 
ant, by  his  agent,  acknowledged  tlie  receipt 
of  the  letter,  and  stated  that  the  goods  were 
"in  store  and  he  would  hold  them  subject  to 
the  order  of  Byers"  (plaintiff's  agent).  That 
atterAvards  the  vendee  of  the  goods  came  to 
the  agent  of  defendant  and,  tende'lng  char- 
ges and  commissions,  demanded  the  goods, 
and  that  the  demand  was  complied  with. 
That  the  vendee  was  insolvent  at  the  date 
of  the  notice  to  defendant's  agent  that  the 
plaintiff  desirt^d  to  stop  the  goods  in  his  hands. 

In  view  of  these  facts,  and  the  law  as  above 
declared,  the  defendant  is  clearly  liable  for 
a  conversion  of  the  goods. 

Judgment  and  order  affirmed. 


RIGHTS  or  UNPAID  SELLER  AGAINST  THE  GOODS. 


'6&J 


KIN<;MAN  et  al.  v.  DKNIJ^ON  ct  al. 

(48  N.  W.  20.  84  Mich.  608.) 

Supreme    Court    of    Michigan.    Feb.    27,    1891. 

Error  to  circuit  court,  Keut  county;  'NVil- 
liaiu  E.  Grove,  .Ttitl;:e. 

Keijlevin  by  Kiujjman  <&  Co.  against  Wil- 
liam C.  Deuison  and  the  McCormick  Har- 
vesting Machine  Company.  There  was  a 
judgment  in  defendants'  favor,  and  plain- 
tiCfs  bring  error. 

Taggart  &.  Denison,  for  appellants.  Sweet 
&  Perkins,  for  appellees. 

LONG,  J.  Ou  July  S.  18S0,  defendant  Den- 
ison wrote  the  plaintiffs  at  Peoria,  111.,  or- 
dering .j.OiX)  pounds  of  twine.  No  dealings 
had  ever  been  had  between  the  parties  prior 
to  that  time.  The  plaintiffs  received  the  let- 
ter next  day.  and  at  once  wrote  Denison: 
"We  have  entered  yoiu-  order,  and  twine 
will  go  forward  to-morrow."  On  July  11th 
the  twine  was  shipped  to  W.  C.  Denison, 
Grand  Rapids.  Mich.,  plaintiffs  taking  ship- 
ping bill  from  the  railroad  company  there, 
and  on  the  same  day  sent  it  to  Deuison, 
with  statement  of  account  for  value  of  the 
twine.  The  twine  was  received  at  Grand 
Rapids  by  the  Grand  Rapids  «fc  Indiana  Rail- 
road Company.  July  ITth,  and  on  the  18th 
they  turned  it  over  to  a  teamster,  who  deliv- 
ered it  at  the  store  which  was  occupied  by 
Denison  at  the  time  the  order  was  made. 
It  api)ears  that  on  July  9th  the  Grand  Rap- 
ids Savings  Bank  caused  an  attachment  to 
be  levied  upon  Denison's  property.  Ou  that 
evening  Denison  gave  the  bank  a  chattel 
mortgage  on  all  the  goods  in  the  store  and 
at  a  warehouse  there,  and  a  store  situate 
at  another  place  outside  of  Grand  Rapids. 
July  10th.  11th,  and  12th  he  gave  mortgages 
on  the  same  property  to  several  other  cred- 
itors, two  of  them  being  given  to  the  defend- 
ant the  McCormick  Harvesting  Machine 
Company.  The  goods  mortgaged  were  held 
in  the  store  by  the  agents  of  the  bank  until 
they  were  sold  under  one  of  the  mortgages, 
which  was  about  July  ISth,  at  which  time 
the  defendant  the  McCormick  Harvesting 
Machine  Company  bid  the  goods  in,  and  con- 
tinued to  occupy  the  store,  putting  Mr.  Deni- 
son in  as  its  agent.  The  McCormick  Har- 
vesting Machine  Company  mortgage  con- 
tained a  clause,  after  a  description  of  the 
pi'operty  mortgaged,  as  follows:  "And  all 
additions  to  and  substitutes  for  any  and  all 
the  above-described  property,"  On  Septem- 
ber 7th  plaintiffs,  who  had  no  notice  or 
knowledge  of  the  changed  condition  of  Mr. 
Denison's  affairs,  drew  ou  him  at  sight  for 
the  amount  of  the  bill.  This  draft  was  not 
paid,  and  ou  September  14th  plaintiffs  wrote 
him  for  prompt  remittance,  which  was  not 
made.  Ou  September  19,  1889.  plaintiffs 
brought  replevin  against  the  defendants  for 
the  twine,  finding  about  one-half  of  it;  the 
balance  having  been  sold  out  of  the  store  by 

VAX  ZILE  SEL,  CAS,  SALES — 24 


the  IMcCormick  Harvesting  Machine  Com^ 
pany.  On  the  trial  of  the  cause  the  defend- 
ants waived  return  of  the  property,  and  had 
verdict  and  judgment  against  the  plaintiffs 
for  .$:i")1.91.  the  value  of  the  twine  taken. 
and  costs.    Plaintiffs  bring  error. 

The  plaintiffs  asked  the  court  to  instruct 
the  jury  that  plaintiffs  were  entitled  to  a 
verdict;  and  in  the  ninth  reciuest  asked  an 
instruction  that  "if  Mr.  Denison  did  not  in 
fact  receive  the  twine  at  his  store,  but  was 
not  there  when  it  was  delivered,  and  never 
received  and  accepted  it  for  his  use  in  any 
way,  except  that,  linding  it  in  the  store,  he 
allowed  the  mortgagees  to  assume  control 
of  it,  plaintiffs  could  retake  it  as  against 
him."  And  in  the  fourteenth  retiuest  it  was 
asked  that  the  jury  be  instructed  that  the 
McCormick  Company,  as  mortgagee,  is  in 
no  better  position  than  Mr.  Denison.  Its 
mortgage  does  not  cover  this  twine,  nor  is 
it  a  bona  fide  purchaser.  Several  requests 
wci'e  also  asked  for  instructions  to  the  jury 
relating  to  the  insolvency  of  Mr.  Deuison  at 
the  time  of  the  purchase,  and  his  intent  not 
to  pay  for  the  twine  at  the  time  of  its  pur- 
chase, or  at  the  time  when  it  was  received 
at  the  store,  on  the  18th  of  July.  These 
last-named  requests  we  do  not  deem  it  nec- 
essary to  set  out  here  for  an  understanding 
of  the  points  involved.  The  requests  set 
out  were  refused  by  the  trial  court,  and  up- 
on such  ruling  the  plaintiff  assigns  error. 
The  court,  in  its  charge  to  the  jury,  stated: 
"Plaintiff"  claims  the  right  to  the  possession 
of  these  goods  at  the  time  this  suit  was 
commenced  —  First,  Because  as  counsel 
claims,  the  goods  were  ordered,  were  pur- 
chased, by  Mr.  Denison  at  a  time  when  he 
Avas  insolvent,  and  knew  that  he  was  insol- 
vent, and  had  no  intention,  or  at  least  no 
reasonable  expectation,  of  paying  for  them 
according  to  the  terms  of  the  contract;  and 
the  plaintiff's  counsel  also  claims  the  right 
of  stoppage  in  transit.  All  I  need  to  say  in 
regard  to  the  latter  claim  is  that  I  think  the 
right  of  stoppage  in  transit,  under  the  facts 
of  this  case  as  shown  by  the  evidence,  has 
no  application  whatever;  there  is  no  svich 
right  existing."  This  part  of  the  charge  re- 
lating to  the  right  of  stoppage  in  transit  is 
assigned  as  error.  The  court  was  in  error 
in  refusing  these  requests  to  charge  and  in 
the  charge  as  given.  It  is  not  seriously 
contended  here  but  that,  under  the  evideuce 
given  on  the  trial,  the  defendant  Denison 
was  insolvent  at  the  time  the  goods  were 
ordered.  At  least  this  was  a  question  of 
fact  which  should  have  been  submitted  to 
the  jury;  and.  if  so  found,  the  question  of 
the  right  of  stoppage  in  transit  was  an  im- 
portant question  in  the  case.  The  right  of 
stoppage  in  transit  is  a  right  possessed  by 
the  seller  to  reassume  the  possession  of 
goods  not  paid  for  while  on  their  way  to  the 
vendee,  in  case  the  vendee  becomes  insol- 
vent before  he  has  aciiuired  actual  posses- 
sion of  them.     It  is  a  privilege  allowed  to 


370 


RKIHTS  OF  UXrAID  SELLER  AGAINST  THE  GOODS. 


the  selle."  I'or  the  particular  purpose  of  pro- 
tectinji"  liini  fi"0"i  the  insolvency  of  the  con- 
signee. The  rif;ht  is  one  hij^hly  favored  in 
the  law.  being  based  upon  the  plain  reason 
of  justice  and  equity  that  one  num's  prop- 
erty should  not  be  applied  to  the  payment 
of  another  man's  debts.  Gibson  v.  Carruth- 
ers,  8  Mees.  &  W.  ^37.  But  it  is  properly 
exercised  only  upon  goods  which  are  in 
passage  and  are  in  the  hands  of  some  inter- 
mediate person  between  the  vendor  and 
vendee  in  process,  and  for  the  purpose  of 
delivery,  and  this  right  may  be  exercised 
whether  the  insolvency  exists  at  the  time  of 
the  sale  or  occurs  at  any  time  before  actual 
delivery  of  the  goods,  without  the  knowl- 
edge of  the  consignor.  O'Brien  v.  Norris.  1(5 
Md.  1-2-2:  Reynolds  v.  Railway  Co..  4.3  N.  H. 
.-•SO;  Blum  v.  Marks,  21  La.  Ann.  2(J8;  Bene- 
dict V.  Scaettle.  12  Ohio  St.  .j15.  This  right 
of  stoppage  in  transit  will  not  be  defeated 
by  an  apparent  sale,  fraudulently  made, 
without  consideration,  for  the  purpose  of 
defeating  the  right.  There  must  be  a  pur- 
chase for  value  without  fraud,  to  have  this 
effect.  Harris  v.  Pratt.  17  N.  Y.  249.  In 
the  present  case  it  appears  that  the  goods 
arrived  in  Grand  Rapids  .Inly  17th.  and  were 
taken  to  the  store  on  the  18th.  Mr.  Deni- 
son  was  not  in  the  store  at  the  time  they 
were  taken  in.  Mr.  Talford  was  in  posses- 
sion of  all  the  goods  and  of  the  store  at  this 
time  for  all  the  mortgagees,  and  after  the 
sale  under  the  mortgage  the  McCormick 
Company  took  possession,  and  Avas  in  pos- 
session at  the  time  this  replevin  suit  was 
commenced.  The  testimony  tends  to  show 
that  at  the  time  demand  was  made  upon 
the  McCormick  Company  and  Mr.  Deuison 
for  the  twine  Mr.  Denison  stated  that  he 
thought  the  plaintiff,  having  heard  of  his 
financial  affairs,  would  not  ship  the  twine, 
and  that  he  did  not  know  it  had  been  ship- 
ped until  it  was  in  the  store;  and  he  was 
very  sorry  it  had  come,  under  the  circum- 
stances.    The  McCormick  Company  claimed 


that  by  the  terms  of  their  mortgage  they 
were  entitled  to  hold  the  twine.  The  court 
was  in  error  in  not  submitting  to  the  jury 
the  question  whether  the  goods  had  come 
actually  to  the  possession  of  Mr.  Deuison. 
The  circumstances  tend  strongly  to  show 
that  he  never  had  actual  possession  of  them, 
and  never  claimed  them  as  owner.  He  had 
made  the  order,  and  was  notified  that  they 
would  be  shipped;  but  from  that  time  for- 
ward it  is  evident  that  he  made  no  claim 
to  them.  The  :McCormick  Company  claim- 
ed that  they  passed  to  it  under  the  terms  of 
its  mortgage.  It  however,  stood  in  no  bet- 
ter position  than  Denison.  If  the  goods 
never  actually  came  into  the  possession  of 
Denison  as  owner,  the  mortgage  lien  would 
not  attach,  even  under  the  clause  in  the 
mortgage  covering  after-acquired  property. 
It  does  not  stand  in  the  position  of  a  bona 
fide  purchaser  of  the  property.  The  right 
of  stoppage  could  not  be  divested  by  a  pur- 
chase of  the  goods  under  the  mortgage  sale. 
The  transit  had  not  ended  unless  there  was 
acttial  delivery  to  Mr.  Deuison.  These  were 
questions  of  fact  for  the  jury,  which  the 
court  refused  to  submit.  If  the  jury  had 
found  that  Denison  was  insolvent  at  the 
time  the  order  was  made,  or  became  insol- 
vent at  any  time  before  the  claimed  deliv- 
ery of  the  goods,  and  that  the  goods  were 
never  actually  delivered  to  the  possession 
of  Mr.  Denison.  then  the  vendors'  rights 
would  have  been  paramount  to  any  right 
which  the  McCormick  Company  could  have 
acquired  at  the  mortgage  sale.  Underbill  v. 
Booming  Co..  40  Mich.  660;  Lentz  v.  Rail- 
Avay  Co.,  .33  Mich.  444,  19  N.  W.  138;  White 
\.  Mitchell,  38  Mich.  390;  James  v.  Griffin, 
2  Mees.  &  W.  623.  In  the  view  we  have 
taken  of  the  case,  we  think  the  other  ques- 
tions raised  are  unimportant,  and  we  will 
not  pass  upon  them.  The  judgment  of  the 
court  below  must  be  reversed,  with  costs, 
and  a  neAV  trial  ordered.  The  other  jus- 
tices concurred. 


RIGHTS  OF  UNPAID  SELLER  AGAINST  THE  GOODS. 


371 


HOLLAND  ct  al.  v.  REA  et  al. 

(12  N.  W.  107,  48  Mich.  218.) 

Supreme   Court  of  Michigan.      April   2.">.   1882. 

Error  to  superior  court  of  Detroit. 

Edward  E.  Kane,  for  plaintiffs  iu  error. 
George  W.  Bates,  for  defeudant.s  in  error. 

GRAVES,  C.  .1.  Keith  it  Holland  elaimed 
that  in  .January,  1877.  they  concluded  an 
aj;reenient  with  Rea  *:  Hale,  by  which  they, 
said  Keith  »!s:  Holland,  were  to  fiu'nish  during 
that  winter  at  or  near  Stoney  Point,  on  the 
shore  of  Lake  St.  Clair,  iu  Ontario,  at  the 
rate  of  three  dollars  per  thousand  feet,  500,- 
000  feet  more  or  less  of  good  sound  elm  logs 
of  first-class  (luality  and  14V2  fet-t  in  length 
and  not  less  than  18  inches  in  diameter;  and 
that  Rea  «S:  Hale  were  to  take  the  logs  so 
furnished  and  pay  therefor  iu  Canada  cur- 
rency or  its  equivalent  iu  United  States  cur- 
rency, that  is  to  say  $500  down  and  the  re- 
mainder on  delivery  of  the  logs.  They  further 
claimed  that  pursuant  to  this  agreement  they 
furnished  47;5,0OO  feet  and  that  the  supply  of 
that  (luantity  constituted  full  performance 
(in  their  part  and  entitled  them  to  require  Rea 
&  Hale  to  take  said  quantity  as  a  fulfillment 
of  the  agreement  and  to  pay  therefor  accord- 
ing to  the  rate  and  manner  stipulated.  That 
300,000  feet  were  actually  taken  and  paid 
for,  but  the  remaining  17o,000  feet  were  re- 
fused. They  brought  this  action  on  the  con- 
tract to  recover  damages  of  Rea  »Jc  Hale  for 
their  failure  to  take  and  pay  for  said  residue 
and  were  allowed  to  recover,  and  the  defend- 
ants below  being  dissatisfied  have  brought 
error. 

Among  the  points  specially  noticeable  two 
relate  to  the  terms  of  this  agreement.  The 
first  is  that  the  description  of  quantity,  viz., 
"500,000  feet  more  or  less,"  was  miserably 
indefinite  and  rendered  the  entire  agreement 
non-obligatory,  and  the  second  is,  that  sup- 
posing the  agreement  was  binding,  still  the 
deviation  from  the  positive  quantity  named 
was  greater  than  the  qualifying  expression 
authorized  and  hence  the  defendants  in  error 
were  by  their  own  admission  in  default  and 
the  plaintiffs  in  error  were  not  bound  to  take 
any  more  than  suited  their  pleasure.  Nei- 
ther of  these  positions  requires  many  words. 
As  to  the  first,  it  was  a  distinct  part  of  the 
imderstanding  of  the  parties  that  the  agree- 
ment iu  regard  to  quantity  should  not  fix  the 
precise  number  of  feet  which  the  defendants 
in  error  should  be  bound  to  furnish.  The  in- 
tent was  that  they  should  be  allowed  to  de- 
viate somewhat  from  500,000  feet  and  that 
the  plaintiffs  in  error  should  be  bound  to  take 
whatever  quantity  should  be  furnished  within 
the  limits  to  which  the  deviation  might  prop- 
erly extend,  and  it  was  certainly  competent 
for  the  parties  to  bargain  iu  that  way.  The 
agreement  was  not  prima  facie  void.  Braw- 
ley  V.  I".  S..  90  U.  S.  108;  Cabot  v.  Winsor,  1 
Allen,  54(5;  Moore  v.  Campbell.  10  Exch.  ;:>2o. 
20  Eng.  Law  &  Eq.  522;   Bourne  v.  Seymour, 


IG  C.  B.  337,  32  Eng.  Law  &  Eq.  455;  Cock- 
erell  v.  Aueompte,  2  C.  B.  (N.  S.)  440,  40  Eng. 
Law  &  Eq.  27!);  Morris  v.  Levison,  1  C.  P. 
Div.  155.  10  Moak,  Eng.  R.  400;  McConuel 
V.  Murphy.  L.  R.  5  P.  C.  203,  8  Moak,  Eng. 
R.  104;    Benj.  Sales,  §§  (i'.H,  (;<)2. 

The  question  of  construction  is  distinct 
and  the  second  point  presents  it.  It  is  not  dif- 
ficult. AVhere  parties  enter  into  executory  ar- 
rangements for  the  sale  of  chattels  to  l)e  ob- 
tained subse(iuently  by  the  seller  and  design- 
edly leave  the  exact  (piautity  unfixed  and  see 
fit  to  remit  its  ascertainment  to  tlie  future  act 
of  the  seller  under  and  sul)ject  to  a  stipula- 
tion that  it  is  to  be  so  uuich  "more  or  less" 
their  practical  construction  of  it  ought  tc 
have  great  weight. 

Several  facts  of  importance  are  undisputed 

Keith  &  Holland  informed  Rea  &  Hale  thai 
they  had  furnished  473.<!00  feet  and  that  the 
agreement  was  thereby  fulfilled.  What  did 
Rea  &  Hale  do?  Did  they  object  that  the 
quantity  was  not  sutficieut  to  satisfy  the 
agreement  V  Did  they  refuse  to  have  any  of 
the  logs  and  repudiate  the  arrangement? 
Nothing  of  the  kind.  They  sent  Baxter  antl 
Fairchild  to  scale  the  logs  and  the  former 
scaled  358.000  feet  and  the  latter  a  further 
quantity.  But  this  is  not  all.  They  broke  in 
upon  the  mass  and  actually  took  away  .some 
300,000  feet  and  not  only  paid  therefor,  but 
for  several  thousand  feet  more. 

It  would  be  difficult  to  reconcile  this  conduct 
with  the  notion  that  the  473.000  feet  were 
not  mutually  considered  as  meeting  the  call 
for  500,000  feet  more  or  less. 

But  if  it  be  regarded  as  a  question  to  be 
settled  on  authority  the  result  is  the  .same. 
The  deviation  was  <iuite  within  the  degree 
the  courts  have  held  to  be  reasonable.  Ca- 
bot V.  Winsor,  and  Morris  v.  Levison,  and 
McCounel  v.  Murphy,  supra.  It  appeared 
that  iu  March,  1877,  one  Aubin,  who  had  got 
out  a  parcel  of  the  logs  and  was  employed 
also  by  Keith  &  Holland  as  their  agent  in 
some  other  matters,  sold  21.000  feet  to  Pike 
&  Richardson.  And  among  the  requests  re- 
fused were  two  which  pioceeded  on  the  as- 
sumption that  the  case  coutained  evidence 
showing  or  tending  to  show  that  these  logs 
never  belonged  to  Keith  &  Holland  and  wei-e 
not  under  their  power  to  tender  on  the 
agreement.  The  assumption  was  not  author- 
ized. 

The  evidence  was  clear  and  not  open  to  con- 
troversy that  these  and  all  the  other  logs 
were  got  out  by  third  persons  with  the  ex- 
press understanding  that  they  were  to  meet 
the  contract  with  Rea  iV:  Hale,  and  be  handed 
over  to  them  in  execution  of  that  agreement 
as  soon  as  ready,  and  the  showiug  was  equal- 
ly explicit  that  when  Rea  &  Hale  were  in- 
formed in  I'^bruary  that  the  whole  quantity 
was  ready  and  they  were  requested  to  take 
the  logs  away  and  make  payment  this  lot 
was  included  and  at  their  disposal,  and  be 
sides  this  showing  the  further  fact  was  tes 
tified  to  and  not  denied  that  the  sales  made 
by  Aubin  to   Pike  &   Richardson   In   March 


372 


KICHTS  OF  rXlWlI)  SELLKK  ACJAINST  THE  GOODS. 


and  aftt'i-  said  iu)li;iratiou  to  llvti  ^  Hah", 
rt-as  with  tho  express  assent  of  the  latter. 
The  a.iireenient  sued  on  was  oral  and  on  its 
completion  the  parties  separated.  Rea  aft- 
erwards drew  np  a  writinj;  which  he  claimed 
to  be  an  exact  end)i)dlment  of  the  unwritten 
ajireement  and  desired  Keith  &  Holland  to 
sisn  it.  They  did  not  assent  to  its  accuracy 
and  refused  to  si^rn  it. 

On  the  trial  Ilea  produced  a  paper  which  he 
claimed  to  be  the  same  and  offered  to  make 
it  evidence  of  the  true  ajireenient.  The  court 
on  objection  excluded  it.  This  was  correct. 
It  was  no  moi'e  than  Rea"s  personal  declara- 
tion. He  had  prepared  the  paper  and  re- 
tained it.  and  no  assent  by  Keith  &  Hol- 
land had  been  siven  to  it.  Moreover  if  it  was 
the  same  that  he  had  tendered  for  their  ac- 
ceptance they  had  expressly  dissented.  It 
was  not  within  any  rule  permitting'  writings 
prepared  and  kept  exclusively  by  the  party 
offering  them  and  unassented  to  by  the  other 
to  be  put  in  evidence.  Flood  v.  Mitchell,  OS 
N.  Y.  507.  In  connection  with  the  offer  of 
this  writing  or  as  part  of  the  same  general 
subject  certain  notes  by  the  stenographers  of 
Holland's  testimony  in  a  former  trial  were 
read  and  immediately  stricken  out  on  motion. 
This  was  right.  They  had  no  place  in  the 
actuiil  contention.  It  is  not  certain  they 
would  have  been  admissible  in  any  view.  But 
apart  from  the  writing  referred  to  they  were 
wholly  irrelevant. 

It  is  also  a  matter  of  complaint  that  the 
court  neglected  to  direct  the  jury  as  request- 
ed to  allow  nothing  for  difference  between 
the  money  of  the  Ignited  States  and  of  Cana- 
da. It  is  not  pretended  that  there  was  any 
difference  in  point  of  fact  and  effect  if  the 
charge  was  to  leave  the  case  as  though  none 
existed.  The  exception  has  no  force.  There 
was  evidence  that  after  Rea  &  Hale  made  de- 
fault the  remaining  logs  were  sold  by  Keith 
&  Holland  to  another,  and  among  the  nu- 
merous requests  to  charge  the  following  was 
preferred:  "That  the  plaintiffs  had  no  right 
to  sell  the  logs  in  question  without  notice  to 
the  defendants,  and  if  the  jury  believe  they 
did  so  that  was  a  rescission  of  the  contract 
in  this  suit  and  the  plaintiffs  cannot  re- 
cover." 

It  is  now  generally  assumed  that  where  the 
agreement  is  silent  in  regard  to  it  and  no 
special  incidents  appear  to  contend  for  it  and 
where  the  extent  of  the  vendee's  liability  is 
not  to  be  unalterably  decided  by  the  price  ob- 
tained, no  notice  of  the  resale  itself  is  neces- 
sary. On  the  other  hand  it  is  held  by  high 
authority  that  to  entitle  the  vendor  to  pro- 
ceed by  resale  instead  of  rescissi(m  or  by  ac- 
tion for  the  whole  agreed  price  or  actual  con- 
sideration, he  mu.st  manifest  his  election  by 
preliminary  notice  that  he  Intends  to  sell  and 
hohl  rile  vendee  for  the  loss  or  notice  to  that 
effect.  This  notice  it  will  be  observed  is  not 
a  notice  of  resale,  but  a  notice  that  the  ven- 
dor will  assert  the  right  of  resale  and  bind 
the  vendee  by  the  price  obtained. 


The  application  of  this  doctrine,  requiring 
notice  of  an  election  to  resCil.  is  now  urged 
by  Rea  &  Hale,  who  insist  that  the  trial  judge 
in  neglecting  the  above  request  disregarded 
it  and  committed  error.  No  complaint  as  we 
understand  is  made  of  the  treatment  of  the 
request  as  one  dealing  with  the  subject  of  no- 
tice of  resale  itself,  and  it  is  plain  that  no 
gi'ound  exists  for  any.  Are  these  parties  en- 
titled to  question  the  action  of  the  trial  judge 
on  the  other  ground?  We  think  not.  Under 
the  practice  pursued  the  subject  is  not  open. 
The  request  was  equivocal.  It  fell  short  of 
indicating  with  any  distinctness  that  the  no- 
tice alluded  to  was  notice  of  election  to  resell 
rather  than  notice  of  actual  resale  itself,  and 
the  inference  is  pretty  strong  that  the  judge 
understood  the  request  as  referring  to  a  no- 
tice of  resale  only,  and  shaped  his  directions 
to  the  jury  on  that  luiderstanding  and  no  ex- 
ception was  taken  to  the  charge  aetually  giv- 
en on  this  part  of  the  case. 

As  the  request  was  fairly  open  to  such  con- 
struction and  the  conception  of  it  by  the  judge 
was  apparent,  or  it  was  obvious  at  least  that 
the  request  had  not  drawn  his  mind  to  the  ap- 
plication of  it  now  insisted  on,  and  no  offer 
Avhatever  was  made  to  explain  it,  it  would  be 
hardly  reasonable  to  j^ermit  it  to  be  read 
here  in  another  sense  for  the  piu-pose  of 
breeding  error,  if  such  would  be  the  result. 
But  this  is  not  all.  The  very  fact  that  the  re- 
(luest  was  ambiguous  and  liable  to  mislead 
is  a  sound  reason  for  deeming  its  rejection 
not  sufticienr  for  a  charge  of  error.  The  re- 
quest should  have  clearly  shown  which  no- 
tice was  meant. 

Error  is  alleged  on  the  exclusion  of  the  of- 
fer of  certain  evidence.  The  complaint  is 
that  Rea  cV:  Hale  were  cut  off  by  it  from  re- 
couping damages.  The  point  is  not  main- 
tainable. Had  the  facts  embraced  in  the  of- 
fer been  established  the  event  would  have 
been  the  establishment  of  an  agreement  whol- 
ly distinct  and  different  from  that  set  up  by 
Keith  c*c  Holland,  and  which  they  were  bound 
to  siibstantiate  or  fail  in  the  action,  and  no 
damages  arising  from  the  breach  of  another 
and  wholly  diff'erent  agreement  could  be  re- 
couped.    Thompson  v.  Richards,  14  Mich.  172. 

The  claim  seems  to  be  made  that  the  re- 
fusal of  certain  requests  In  some  way  preju- 
diced Rea  &  Hale's  right  of  set-off'.  The  sug- 
gestion is  not  very  clear.  But  it  Is  enough  to 
say  without  going  further  that  the  case  did 
not  authorize  the  I'emedy  by  set-off".  The  ac- 
tion was  for  the  breach  of  a  special  agree- 
ment and  brought  to  recover  unli(iuidated 
damages  and  was  therefore  foimded  on  a  de- 
mand incapable  of  being  the  subject  of  set- 
off'. Section  .■">71t(>,  Comp.  Laws;  Smith  v. 
Warner,   14   Mich.   1-")^. 

All  the  (juestions  worthy  of  notice  have 
now  been  considered.  The  chai'ge  to  the  jury 
was  fair  and  there  is  nothing  in  the  record  to 
call  for  any  interference  with  the  result. 

The  judgment  Is  attirmed  with  costs. 

The  other  justices  concurred. 


RIGHTS  OF  UNPAID  SELLER  A(JA1NST  THE  GOODS. 


373 


WONDERLY  v.  HOLMES  LUMBER  CO. 

(23  N.  W.  79,  56  Mich.  412.) 

Supreme  Court  of  Michigan.    April  22,  1885. 

Error  to  superior  court  of  Detroit. 

H.  M.  Campbell,  for  appellant.  Wilkinson 
&  Post  and  Taggart  &  Woleott,  for  appel- 
lee. 

SHERWOOD,  J.  In  August,  1S82.  the 
plaintiff,  a  lumberman  residing  ;it  (irand 
Rapids,  entered  into  negotiations  with  the 
defendant,  a  lumber  company  in  Detroit,  foi" 
the  purchase  of  lumber  manufactured  and 
to  be  manufactured  near  Stanton,  Michigan, 
which  resulted  in  the  execution  of  a  con- 
tract by  which  the  defendant  purchased 
from  the  plaintiff  all  the  white  pine  lumbei; 
which  the  Wagar  Lumber  Company  had  cut 
for  the  plaintiff  after  January  1  of  the  same 
year,  also  all  the  lumber  which  should  there- 
after be  cut  for  him  by  said  company  up 
to  .January  L  1883.  The  defendant  did  not 
take  all  the  lumber  cut  during  said  period, 
and  about  January  1,  188;'),  the  defendant 
refused  to  take  any  more  under  the  contract, 
or  to  make  any  further  payments;  and  the 
plaintiff,  after  giving  notice  of  his  purpose 
hereinafter  mentioned,  sold  the  lumber 
which  was  not  taken  by  the  defendant,  and 
brings  this  suit  for  the  defendant's  alleged 
breach  of  the  contract,  and  seeks  to  recoV: 
er  the  difference  between  the  amount  which 
it  brought  on  the  sale  and  the  price  agreed 
upon  in  the  contract. 

The  defendant  claims  (1)  that  the  contract 
it  made  for  the  purchase  of  the  lumber  was 
l>a.sed  upon  certain  representations  as  to  the 
grades  and  (luality  of  the  lumber,  upon 
which  the  defendant  had  the  right  to  and 
<lid  rely,  and  which  were  untrue;  (2)  that  in 
making  the  sale  of  the  lumber  not  taken  by 
defendant,  plaintiff  did  not  realize  all  that 
could  hnve  been  made  out  of  it,  and  which 
it  was  his  duty  to  do  before  recovery  could 
be  had.  The  caiLse  was  tried  in  the  superior 
court  of  Detroit  before  a  jury,  and  the  plain- 
tiff recovered  -1^3,428.70.  Defendant  brings 
error. 

The  notice  attached  to  the  defendant's 
plea  sets  up  in  effect  the  defense  that  the 
plaintiff  warranted  the  grades  and  qualities 
of  the  lumber.  The  written  contract  be- 
tween the  parties  was  preceded  by  several 
letters  relating  to  the  lumber  and  price 
thereof  which  the  defendant  desired  to  pur- 
chase, a  brief  summary  of  which  is  as  fol- 
lows: 

"August  11,  1882.  defendant  writes  to  the 
plaintitt'  that  he  has  seen  the  lumber  and  re- 
quests prices  by  grades.  August  IGth.  the 
plaintiff  writes  that  he  prefers  to  sell  mill- 
run.  August  17th,  the  defendant  writes 
that  he  would  just  as  soon  buy  mill-run  as 
by  grades;  makes  some  inquiry  as  to  top 
logs,  grade  of  logs,  and  how  they  were  but- 
ted in  the  woods,  and  concludes:    'We  want 


to  know  just  what  we  will  get  if  logs  are 
same  as  those  being  cut  now.  Send  us  an 
estimate  of  lumber  cut  and  piled  to  Au- 
gust 15th,  by  grades.'  August  18th,  the 
plaintiff  writes  that  the  log.s  are  all  same  as 
are  being  cut  now,  gives  appro.ximate 
amount  cut  and  piled,  promises  to  get  esti- 
mate of  each  grade,  and  states  terms  of 
payment  generally.  August  I'Jth,  the  de- 
fendant writes  arrangements  for  meeting  to 
conclude  contract.  August  22d,  the  plaintiff 
sends  an  'estimate  of  the  different  grades  as 
piled.'  in  which  he  gives  (piantities  by 
grades,  in  each  instance  preti.xed  by  the 
word  'about,'  and  takes  the  further  precau- 
tion to  add  that  it  is  'estitnate  only."  and  of- 
fers to  sell  the  stock  at  ^Vi  per  M.,  as  per 
his  settlement  for  .•rawing,  and  have  .same 
loaded  on  cars;  says  lumber  sliould  be  good, 
as  all  coar.se  logs  are  taken  out  for  shingles. 
August  28d.  the  defendant  acknowledges  re- 
ceipt of  said  'estimate;'  notices  that  it  cov- 
ers only  l.,5(>o.(K»0  out  of  1.7(»iMi()0  feet  saw- 
ed, states  percentages,  and  offers  .$12  per 
M.;  propo.ses  terms  of  payment;  states,  'If 
this  is  a  fair  estimate.  $12  per  M..  cash,  is 
all  the  stock  is  worth.'  August  24th,  the 
plaintiff  corrects  omission  in  estimate,  de- 
clines offer  of  $12,  and  again  oft'ers  to  sell 
at  $13  for  that  then  on  hand,  and  what 
shall  be  cut  i>p  to  .January  1.  1883.  August 
2.'>th,  the  defendant  notifies  the  plaintiff"  of 
(Un-isiou  to  taKe  lumber  now  cut  and  what 
may  be  cut  up  to  January  1,  18)'3,  at  $13 
per  M.,  providing  manner  of  payment  as 
stated  August  23d  suits,  and  suggests  ar- 
rangements to  meet  and  fix  up  coiitract  and 
other  details." 

On  the  thirtieth  of  August,  in  pursuance 
of  the  arrangement  for  that  purpose,  the  par- 
ties met  at  Grand  Itapids.  where  a  contract 
in  writing  was  entered  into  for  the  purchase 
and  sale  of  the  lumber  then  cut  and  sawed 
and  afterwards  to  be  cut  and  sawed  pre- 
vious to  the  first  of  January.  1883.  (a  copy 
of  which  win  be  foimd  in  the  margin.i) 

1  This  a;rreenieiit.  made  this  thirtieth  day  of 
August.  A.  D.  1882.  by  and  between  Josepli  H. 
Wonderly,  of  Grand  Rapids,  Michigan,  jiarty 
of  tlie  first  part,  and  the  Holmes  I>uml)er  Com- 
pany, a  manufactm'ing  corporation  organized 
under  the  laws  of  tiie  state  of  Michigan,  and 
liavinjx  its  principal  ottice  at  Detroit,  party  of 
the  second  part,  witnesseth: 

(1)  That  the  said  party  of  the  first  part,  in 
consideratiou  of  the  sum  of  five  thousand  dol- 
lars (.$5,000)  to  him  paid  by  the  said  party  of 
the  second  part,  and  of  the  further  paymi'Uts 
to  he  made  by  said  p.arty  of  the  second  part, 
as  hereina  t'ter  proviiled.  hereby  atrrees  to  sell 
unto  said  jiarty  of  tlie  second  part  all  of  the 
white  pine  lumber  which  has  lieen  sawed  for 
liim  by  the  ^^'agar  I..uniber  Comjjanv  since 
Jainu\ry  1,  A.  D.  188'2,  and  all  that  snid  last- 
named  company  shall  saw  for  him  duriusr  the 
remainder  of  tlie  current  year,  at  and  for  the 
contract  purchase  price  of  thirteen  dollars  per 
thousand  feet,  board  measure,  mill-run:  said 
lumber  shall  include  all  grades  of  lumber  above 
mill-culls. 

(2)  The  final  settlement  and  payment  for  said 
luml)er  shall  be  uuide  according  to  the  scale 
made    inu'suant   to    the    terms    of    the    contract 


374 


RIGHTS  OF  UNPAID  SELLIHI  AUAINST  THE  GOODS. 


It  appoaivtl  ou  the  trial  that  the  amount 
of  lumber  which  was  (.-overetl  by  said  con- 
tract was  2,4r>(;.ir,7  feet.  Of  this  the  defend- 
ant, prior  to  .January  1,  1SS3,  received  1,- 
()l(i..">(;o  feet.  Haviuf,'  paid  in  the  mean  time, 
besides  the  ^."),U<X»  down.  .i;y,22."..71.  by  the 
terms  of  the  contract  a  large  sum  was  pay- 
able .Tanuary  1,  18S;{,  which  the  defendant 
refused  to  pay,  and  also  refused  to  proceed 
under  the  contract.  Thereupon  plaintiff 
gave  this  notice: 

"To  the  Holmes  Lumber  Company,  Detroit, 
Mich.: 

"You  liaviufr  defaulted  in  the  payment  due 
me  from  you.  under  contract  dated  August 
:'(),  1S82,  for  tlie  sale  and  purchase  of  my 
lumber  cut  by  the  Wagar  Lumber  Company 
during  season  of  1S82,  and  having  refused 
to  further  perform  said  contract,  I  hereby 
give  you  notice  that  unless  you  forthwith 
l>ay  at  least  one-half  of  the  (.?12,v)71  U-100) 
twelve  thousand  nine  hundred  and  seventy- 
one  9-10()  dollars  that  fell  due  on  said  con- 
tract on  the  tirst  inst.,  and  come  to  an  Im- 
mediate settlement,  and  speedy  adjustment 
and  payment  of  the  remainder  thereof,  I 
shall  proceed  to  sell  the  portion  of  the  said 
lumber  still  on  hand  for  the  best  prices  I 
can  obtain  for  it,  and  credit  you   with   the 

dated  December  14.  1880,  between  said  Won- 
derly  and  the  Wagar  Lumber  Company,  and 
said  scale  shall  be  conclusive  upon  both  parties 
to  this  contract  in  determining  the  amount  of 
said  Imnber. 

Cb  The  shinjile  logs  shall  be  assorted  out  of 
the  logs  hereafter  to  be  manufactured  into  lum- 
ber under  the  terms  of  this  contract,  in  like 
manner  as  they  liave  been  assorted  out  of  the 
logs  from  which  the  said  lumber,  now  cut  and 
in  ])ile,  was  manufactured. 

(4)  The  said  party  of  the  second  part  hereby 
agrees  to  buy  all  of  the  said  lumber  manufac- 
tured and  to  be  hereafter  manufactured  as 
aforesaid,  and  to  pay  therefor  at  the  price  of 
thirteen  dollars  per  thousand  feet,  board  meas- 
ure, in  manner  following,  viz.:  The  sum  of 
five  thousand  dollars  (.^,5,(X)0)  shall  be  paid  at 
th(*  execution  and  delivery  of  this  contract. 
All  lumber  shii)i)ed  by  said  party  of  the  second 
part  from  the  tirst  to  the  fifteenth  days  of  each 
month,  shall  be  paid  for  at  the  aforesaid  con- 
tract price,  upon  the  twentieth  day  of  the  same 
month;  and  all  lumber  shii)ped  by  said  second 
party  from  the  sixteenth  (liitli)  to  the  end  of 
each  month,  shall  be  paid  for  on  the  fifth  day 
of  the  next  succeeding  month,  at  said  contract 
price.  Not  more  than  2.30.000  feet,  board  meas- 
ure, of  said  lumber  shall  be  shipped  in  any  one 
period  of  l."  days  above  mentioned,  unless,  be- 
fore such  further  shipment  shall  be  made,  said 
second  party  shall  pay  said  first  party  in  ad- 
vance sutticient  money  to  pay  for  the  amount 
of  lumber  so  to  be  shipped  in  excess  of  230  M. 
feet  during  such  l.")-day  period:  the  price  of 
such  excess  f)f  shii)nient  to  be  .$13  per  thousand 
feet,  the  same  as  all  of  said  lumber. 

(."))  It  is  further  agreed  that  all  lumber  now 
sawed  and  in  the  yard,  or  an  equal  amount  of 
the  lumber  covered  by  this  contract,  shall  be 
shiiiped  out  during  the  year  1882;  or.  if  not 
shipped  within  that  time,  that  said  amount  of 
lumber,  being  about  l.S(K»,(M)0  feet,  shall  be 
I)ai(l  for  in  full  on  or  l)efore  .January  1,  1883. 

(<;i  It  is  further  agreed  that  so  much  of  the 
lumber  covered  by  this  contract  as  shall  be 
manufacttired  between  this  date  and  October  1, 
1882.  shall  be  shipped  out  by  said  party  of  the 
second  part  before  May  1,  1883;    or,  if  not  so 


proceeds  thereof,  to  apply  on  the  amount 
due  and  to  become  due  on  said  contract.  If 
you  will  make  payment  and  settlement  as 
above  stated,  all  past  breaches  of  said  con- 
tract, and  all  claim  for  damages  arising  from 
such  breaches,  will  be  waived. 
"Dated  (irand  Rapids.  .January  23,  1883." 
Plaintiff  then  proceeded  under  the  notice  to 
sell  the  lumber  which  defendant  had  refused 
to  receive,  and  sold  it  nearly  all  at  private 
sale,  realizing  therefor  .$14,021.03,  and  the 
value  of  that  which  remained  unsold  was 
.$549.43.  There  was  a  small  bill  of  lumber 
which  defendant  had  purchased  of  plaintiff, 
December  10,  1882,  amounting  to  .$100.49. 
outside  of  the  contract,  which  was  admitted 
by  consent.  Including  this,  plaintiff's  loss,  as 
he  claimed,  from  defendant's  breach  of  the 
contract,  aside  from  all  expense  of  selling  the 
lumber,  was,  with  interest.  $3.428.70,— the 
amount  of  the  judgment  he  recovered.  The 
defendant  claims  the  lumber  was  not  examin- 
ed by  its  agents  with  a  view  of  ascertaining 
its  quality;  that  what  was  cut  was  in  piles, 
so  that  its  quality  could  not  be  determined 
from  inspection;  that  the  contract  was  made 
on  the  basis  of  estimates  furnished  by  plain- 
tiff, and  that  the  defendant  expresslj'  relied 
npou    them;     that    the    representations    as    to 

shipped,  then  the  same  shall  be  paid  for  in  full 
on  or  before  the  day  last  mentioned;  and  it  is 
further  agreed  that  all  of  said  lumber  manufac- 
tured after  October  1,  1882,  shall  be  fuUy  paid 
for  on  or  before  June  1.  A.  D.  188.3. 

(7)  It  is  further  agreed  that  the  title  and 
ownership  of  said  lumber  shall  not  pass  from 
said  Wonderly  to  said  party  of  the  second  part, 
except  as  the  same  is  shipped  out  of  the  mill- 
yard  pursuant  to  this  contract  or  fully  paid  for. 

(8)  It  is  further  agreed  that  the  five  thousand 
dollars  ($.5,000)  advance  payment  heretofore 
mentioned  shall  be  held  by  said  party  of  the 
first  part  until  the  final  settlement  of  all  mat- 
ters embraced  in  this  contract;  and  upon  such 
final  settlement  said  sum  (.$5.(X)0)  shall  be  ap- 
plied towards  the  pavmeut  of  the  last  four  hun- 
dred thousand  (400.000)  feet  of  said  lumber, 
and  any  balance  still  mipaid  shall  then  be  paid 
by  said  party  of  the  second  part  to  said  party 
of  the  first  part. 

(9)  It  is  further  agreed  that  said  party  of  the 
first  part  will  keep  said  lumber  insured  to  the 
amount  of  $5,000  or  upwards,  for  the  benefit 
and  protection  of  said  party  of  the  second  part, 
and  at  his  own  expense,  until  the  title  of  the 
same  shall  pass  to  .said  second  party  as  here- 
inbefore provided. 

(10)  It  is  further  agreed  that  said  party  of 
the  second  part  may  from  time  to  time  give 
said  party  of  the  first  part  directions  in  writ- 
ing concerning  the  manufacture  of  said  lumber, 
and  that  said  party  of  the  first  part  will  cause 
such  directions  to  be  observed  and  followed  as 
far  as  possible  in  the  sawing  of  said  lumber. 

(11)  It  is  further  agreed  that  said  party  of 
the  second  part  shall  have  all  of  the  rights  in 
relation  to  the  loading  of  said  lumber  upon  the 
cars  that  are  secured  unto  said  party  of  the 
first  part  l)y  the  said  contract,  dated  December 
14,  1880,  between  him  and  the  Wagar  Lumber 
Company. 

In  witness  whereof,  the  said  party  of  the  first 
part  has  hereunto  set  his  hand,  and  the  said 
party  of  the  second  part  has  hereunto  signed 
its  name,  by  its  secretary,  this  thirtieth  day  of 
August,  A.  D.  1882.  Joseph  H.  Wonderly. 
Holmes  Lumber  Co. 
By  Hugh  A.  Holmes,  Sec'y. 


RIGHTS  OF  UNPAID  SELLER  AGAINST  THE  GOODS. 


376 


quality  are  all  in  writing,  and  were  relied  up- 
on by  defendant;  that  the  representations 
were  of  such  character  as  implied  linowled^'c 
on  the  part  of  the  plaintiff  both  as  to  quality 
of  grades  and  quantity  of  the  lumber;  and 
that  the  defendant  had  a  right  to  rely  upon 
the  same,  and  if  the  lumber  failed  to  comply 
with  the  representations  made,  then  the  plain- 
tiff was  guilty  of  false  warranty.  Defendant 
also  claims  that  these  positions  are  fully  sus- 
tained by  the  preliminary  negotiations  had  by 
letters  which  resulted  in  making  the  contract 
sued  upon,  and  that,  as  explanatory  of  the 
contract,  thej'  should  have  been  received  in 
evidence. 

The  plaintiff,  on  the  other  hand,  claims  that 
the  defendant's  plea  and  notice  limits  the  in- 
quiiy  to  the  terms  of  the  contract  itself;  that 
the  preliminary  letters  form  no  part  of  the 
agreement  entered  into,  and  themselves  show 
it  was  not  intended  they  sliould;  that  when 
they  are  looked  upon  in  the  liglit  of  the  cir- 
cumstances under  whicli  they  were  written, 
they  show  that  all  the  propositions  that  were 
made,  as  to  quality-,  grades,  and  quantity, 
were  well  and  carefully  guarded;  that  the 
plaintiff  had  declined  to  treat  with  the  de- 
fendant for  a  sale  by  grades;  that  he  only 
gave  an  opinion  as  to  that  which  defendant's 
agent  could  not  see,  and  which,  at  most,  could 
only  be  constnied  a  qualified  estimate,  and  not 
intended  to  be  definite;  and  that  both  parties 
contemplated  the  final  agreement,  when  made, 
should  be  put  in  writing,  and  wliich  was  final- 
ly done,  and  this  alone  must  be  looked  to  for 
rhe  extent  and  limit  of  the  plaintiff's  obliga- 
tions; that  these  opinions  and  indefinite  esti- 
mates, given  under  the  circumstances  they 
were,  cannot  be  made  the  basis  of  a  claim 
of  false  warrant.v;  that  such  a  construction 
would  be  doing  violence  to  the  intention  of  the 
parties,  to  the  injury  of  the  plaintiff;  that  the 
doctrine  of  caveat  emptor  applies  with  fuU 
force  to  such  a  case;  and  that  all  prior  treaties 
and  conversations  to  the  making  of  the  con- 
tract, and  which  resulteil  therein,  should  be 
excluded,  as  merged  therein,  and  the  warran- 
t.v, if  any,  and  whatever  its  character,  must 
be  found  in  that  instrument. 

This  conflict  of  views  between  the  parties 
raises  one  of  the  vital  questions  in  the  case. 
Bj-  a  careful  insiiection  of  the  contract  be- 
tween the  parties  it  will  be  discovered  there 
is  nothing  ambiguous  in  its  meaning  or  in  any 
of  the  terms  used.  It  is  not  a  bill  of  sale 
simiily,  but  a  full  and  well-completed  contract. 
It  also  relates  to  eveiy  subject  alluded  to  or 
treated  of  in  the  correspondence  lietween  the 
parties  which  resulted  in  the  making  of  the 
contract.  Both  of  the  parties  were  engaged 
in  the  lumber  business  and  trade  wlieu  the 
contract  was  made,  and  there  is  nothing  in 
the  case  showing  that  either  had  the  oppoi-- 
timity  to  aciiuire.  or  did  if  he  could  profit  by 
his  superior  knowledge  of  the  business  in 
hand  or  its  surroundings.  Under  such  cir- 
cumstances, to  admit  the  correspondence  and 
treaties   had  between   the  parties  before  they 


culminated  in  the  contract  by  which  they  had 
agreed  to  be  governed,  would  not  only  be  a 
plain  violation  of  the  most  elementaiy  princi- 
ples of  law  and  i-ules  of  evidence,  but  also 
every  reason  upon  which  the  iniles  established 
in  such  cases  are  founded. 

The  two  objects  to  be  accomplished  in  re- 
ducing a  contract  to  writing,  are  (Ij  to  limit 
the  terms  of  the  agreement  to  what  are  there- 
in expressed;  and  (2)  to  perpetuate  the  evi- 
dence of  the  existence  of  the  contract,— both 
of  which  would  be  completely  fnistrated  in 
this  case  if  the  preliminary  negotiations  of  the 
parties,  offered  Ijy  defendant's  counsel,  had 
been  received  in  evidence.  The  ruling  of  the 
judge  of  the  superior  court  upon  this  subject 
was  correct. 

In  construing  the  contract  the  court  held, 
in  substance,  and  charged  the  jury,  that,  wliat- 
ever  the  product  of  the  sawing  of  the  Wagar 
Lumber  Company  was  above  mill-culls,  the 
defendant  was  bound  to  take  it,  and  that  it 
made  no  difference  whether  it  was  of  the 
highest  or  lowest  quality.  This  charge  was 
excepted  to  l)y  defendant's  coimsel.  I  can 
see  no  ground  for  this  exception.  I  think  the 
construction  given  is  the  plainest  deduction 
that  can  be  made  from  the  language  used  in 
the  contract. 

It  is  said  by  counsel  for  defendant  that 
there  is  nothing  said  in  the  contract  about  the 
amount  of  each  grade,  unless  it  is  implied  in 
the  term  "mill-run,"  used  in  the  instrument, 
and  this  it  is  claimed  does  not  cover  the  sub- 
ject of  grades  of  lumber  so  as  to  exclude  a 
si^ecific  warranty  thereof,  but  rather  implies 
the  manner  of  payment.  The  fact  is  that  the 
term  not  only  indicates  and  specifies  that  the 
defendant  was  to  take  all  the  grades,  save  the 
one  excepted  out,  as  they  came  from  the  mill, 
but  also  that  what  the  lumber  came  to  at  the 
price  agreed  upon  per  thousand  was  to  be 
determined  in  the  same  way.  Had  it  been 
that  any  warranty-  as  to  the  quality  and 
amount  of  the  different  grades  was  intended. 
it  certainly  would  have  been  put  into  the  con- 
tract when  the  subject  was  thus  so  clearly 
l>efore  the  parties  at  the  time  the  contract 
was  made.  In  that  event,  of  course,  the 
amount,  if  it  had  been  agreed  upon,  in  each 
grade  would  have  been  stated,  and  the  quali- 
ty would  also  have  been  defined,  if  a  warranty 
had  been  intended  in  a  very  different  manner. 
To  hold  otherwise  between  the  parties  to  this 
record,  with  their  business  capacity,  and  ex- 
perience and  familiariry  with  the  lumber 
trade,  would  Ije  to  assume  they  were  unable 
to  make  contracts  for  them.selves  required  in 
their  trade,  and  that  it  is  the  duty  of  the 
coui'ts  to  exercise  a  superintending  care  over 
their  agreements  when  brouglit  before  them, 
and  make  them  for  the  parties,  when  either 
considered  himself  aggrieved  in  his  transac- 
tions with  the  other,  instead  of  enforcing 
tliem  as  made.  Such  is  not  the  rule  of  law 
nor  of  common  sense. 

lieally  the  record.  I  think,  shows  the  plain- 
tiff refused  to  sell  by  grade,  and  if  so,  it  pre- 


376 


IIKUITS  OF  r.NTAU)  SI<:LLER  A<iAINST  THE  GOODS. 


dudes  all  ideas  of  a  \v;ii-:!!ity  hy  .urades  as  to 
(luality.  So  far  as  the  logs  weie  to  l)e  cut 
after  the  making  of  the  contract,  thei'e  does 
not  appear  to  be  any  testimony  showing  that 
they  did  not  comply  \A-ith  the  contract  relat- 
ing thereto,  or  with  the  representations  con- 
tained in  the  letters  of  August  ISth  and  22d. 
A\'itnesses  Backus  and  Swartz  were  inciuired 
of  as  to  tlie  value  of  the  lumber  whicli  was 
not  taken  by  defendants,  and  tlie  averages. 
They  seem  to  have  been  competent,  and  I 
liave  discovered  no  error  in  admilling  their 
testimony. 

The  ruling  of  the  court  as  to  tlie  manner  of 
sale,  and  diligence  necessary  to  be  exercised 
by  the  plaintilf  in  making  sale  of  the  lumber 
whidi  defendant  refused  to  take  under  the 
contract,  is  in  different  forms  made  the  sub- 
ject of  several  objections;  none  of  which, 
however,  I  think  are  well  taken.  There  were 
several  modes  of  disposing  of  the  lumber  left 
upon  the  plaintiffs  hands  by  the  refusal  of 
the  defendant  to  take  it  under  the  contract. 
Any  of  these  modes  would  have  been  entirely 
proin'r,  and  in  such  case,  if  the  party  adopts 
.such  as  his  judgment  approves  as  the  l)est, 
and  uses  i)roper  diligence  in  the  mode  adopted, 
no  more  can  be  required  of  him.  (Jne  thing 
is  (piite  clear:  the  iilaintiff  would  not  be 
obliged  to  incur  any  expense  reiiuiring  an  ad- 
vance of  money  in  making  sales  not  absolute- 
ly necessaiy  in  either  of  the  modes  that  might 


])e  adopted.  The  question,  whether  the  plain- 
tilf did  his  duty  in  making  sale  of  the  lumber 
not  taken,  was  properly  .submitted  to  the  jury, 
their  verdict  is  in  favor  of  the  plaintiff,  and 
this  is  linal  upon   the  question. 

I  think  tlu'  charge  of  the  com-t  was  clear  up- 
on tlie  points  made  iu  the  case  before  the  jtiry, 
and  sutiiciently  covered  all  the  questions  con- 
tained in  defendar.t's  reciuest  to  charge,  neces- 
saiy to  aid  them  in  coming  to  a  correct  con- 
clusion; and  no  error  was  committed  in  re- 
fusing to  charge  the  other  requests.  I  do  not 
think  tlie  record  presents  a  case  in  which  the 
rale  laid  down  in  Picard  v.  McCormick,  11 
Mich.  <kS,  is  applicable.  Neither  do  I  think 
any  error  was  committed  in  allowing  the  jury 
to  take  the  memorandum  to  their  room  when 
they  retired.  The  rule  is  undoubtedly  as 
claimed  by  coimsel  for  the  defendants.  In  re 
Foster's  Will.  34  Mich.  21;  Manufacturing 
Co.  V.  McAlister,  30  Mich.  327.  But  this  case 
falls  within  the  exceptions,  and  no  prejudice 
could  have  resulted  to  either  side  by  the 
course  pursued. 

After  a  full  and  careful  investigation  of  the 
points  made  upon  the  record  in  this  case,  I 
have  been  uruible  to  disc-over  any  error,  and 
the  judgment  of  the  superior  court  of  Detroit 
therein  should  be  affirmed. 

CHAMI'LIX,  .T.,  concurs  in  result.  COO- 
IvBY,  C.  J.,  and  CAMPBELL,  J.,  concur. 


RIGHTS  OF  FNrAID  SELLER  AGALXST  THE  G(JUl)S. 


r, 


UNEXCELLED  FIRE- WORKS  CO.  v.  POLITES. 

(IS  All.  Rep.  1058,  130  Pa.  St.  .>30.) 

Supreme  Court  of  Pennsylvania.     Jan.  6,  IWO. 

Error  to  court  of  coumion  pieas,  Lawrence 
county. 

Belore  Paxsox,  C.  J.,  Stkrrett,  Giikkn, 
Clakk,  Williams,  McCollum,  and  Mncii- 
KLL,  .J J. 

M".  //.  Falls,  for  plaintiff  in  error.  D. 
Jameson,  (with  liim  6'.  E.  Treadwell,)  for 
defendant  in  error. 

CLARK,  .T.  This  is  an  action  of  assumpsit, 
broufriit  July  20,  1888,  to  recover  the  price  of 
a  certain  lot  of  tire-works  and  celebration 
goods,  onlered  by  the  defendant,  George  Po- 
lites,  from  tiie  Une.xcelie  I  Fire-Wori<s  Com- 
pany, of  New  Yorli,  in  February,  1888,  The 
first  order,  which  was  for  iiis  store  in  New 
Castle,  was  givin  through  tlie  plaintiff's 
agent,  Ale.xamler  Morrison,  and  amounted  to 
.^208. 53;  tiie  second,  sent  dii'ectly  to  llie  plain- 
tiff, was  for  tiie  defendant's  store  in  Wash- 
ington, Pa.,  and  amounted  to  ,S12:3.83.  These 
orders  wei'e  in  writing,  and  were  signed  by 
the  defendant.  They  specified,  not  only  the 
particular  kind  and  quality  of  tlie  articles  or- 
dered, but  conlained  also  a  sch.^dule  of  tiie 
prices  to  be  paid  therefor.  The  goods  were  to 
be  shipped  in  ^Liy,  and  were  to  be  paid  for  on 
the  lUth  day  of  .July  thereafter.  Upon  re- 
ceipt of  these  orders  the  plaintiff  transmitted 
by  letter  a  formal  acceptance  of  them.  A 
contract  was  thus  created,  tlie  obligation  of 
which  atta  hed  to  both  parties,  and  wliicli 
neither  of  them,  witliout  the  agreement  or 
assent  of  the  otlier,  could  rescind.  On  tlie 
otii  day  of  April,  1888,  the  detendant,  by  let- 
ter, informed  the  plaintiff  that  he  did  not 
want  tiie  goods,  and  notilied  the  plaintiff  not 
to  siiip  them,  as  lie  roiild  do  belter  witli  an- 
other company.  The  plaintiffs  replied  tliat 
tliey  had  accepted  tlie  orders,  and  liatl  placed 
theui  in  good  failli,  and  tliat  tlie  goods  would 
be  shipped  in  due  time,  according  to  the 
agreement.  The  goods  were  sliipped  witliin 
the  time  agreed  upon, — the  first  lot  to  New 
Castle,  and  the  second  lot  to  Wasliington, 
according  to  contract;  but  on  tiie  arrival  the 
defendant  declined  to  receive  them.  The 
carrier  notilied  the  shipper  that,  owing  to  tlie 
dangerous  and  explosive  quality  of  tiie  goods, 
they  woidd  not  retain  them  in  their  posses- 
sion. The  |ilaintiff  thereupon  recei veil  them 
back  from  the  carriers,  and  placed  tiiera  on 
storage,  subject  to  tlie  defeUilant's  order. 

Tlie  plaint  iff  alleges  that  it  is  a  manufact- 
urer and  importer  of  such  fire-works  as  are 
used  in  the  4tli  of  July  celebrations  through- 
out the  country;  that  it  is  not  profitable  to 


'  carry  these  goods  over  from  one  season  to  an- 
other, and  that  tlieicforc  tiie  quan;ity  manu- 
factured and  impoited  depends  upon  tlie  ex- 
tent of  the  orders  received;  that  llie  defend- 
ant's orders  entered  into  its  estiinatHS  of 
goods  to  be  made  up  and  import. hI  for  the 
season  of  1888,  and  that  the  goods  ordered  by 
the  d  fentlant  were  actually  made  up  belore 
the  order  was  countermanded.  The  defend- 
ant testifies,  however,  that  Mr.  Morrison,  the 
plaintiff's  agent,  informed  liim,  at  tlie  time 
he  gave  the  lir.-st  order,  that  the  plaintiff  had 
some,  at  least,  of  tiie  art.cles  in  stock,  and 
that  lie  did  not  order  any,  either  to  be  manu- 
factured or  importi'd  on  liis  account;  that  the 
transaction  wa.s  simply  a  bargain  and  sale  of 
goods,  and  not  an  order  for  goods  to  be  manu- 
factured or  imiiorted;  and  the  evidence  doe^ 
not  seem  to  conllict  with  tliis  view  of  tlie 
case.  It  is  plain  tliat  tlie  notice  given  to  the 
plaintiff  by  the  detendant  not  to  ship  tlie 
goods  was  a  repudiation  of  tlie  contract,  ll 
was  not  a  rescis.sion,  for  it  was  not  in  the 
power  of  anyone  of  tlie  parties  to  rescind; 
but  it  svas  a  refusal  to  receive  the  goods,  not 
only  in  advance  of  th"  delivery,  but  before 
they  were  separated  from  the  bulk,  and  set 
apart  to  the  defendant.  The  direction  not  to 
sliip  was  a  revocation  of  the  carrier's  agency 
to  receive,  and  the  plaintiff  thereljy  hail  no- 
tice of  the  revocation.  Tlie  delivery  of  the 
goods  to  tlie  carrier,  therefore,  was  unm- 
tliorized,  and  the  carriers  receipt  would  not 
charge  tlie  defendant.  The  piaintiff  itself 
made  the  carrier  its  agent  for  delivery,  but 
the  goo  Is  were  in  fact  not  delivered.  A  de- 
livery was  tendered  by  the  carrier,  when  tlie 
goods  arrived  at  their  destination,  but  they 
were  not  received.  The  action,  tlierefore, 
could  not  be  for  the  price,  but  for  special 
damages  for  a  refusal  to  receive  the  goods 
wlien  tlie  delivery  was  tendered.  We  think 
the  statement  was  sulhcient  to  justify  a  re- 
covery of  sucii  damages,  las  the  words  of 
the  statement  were  clearly  to  this  effect;  but 
there  was  no  evidence  given  of  the  market 
value  of  the  goods  as  compared  with  the  price. 
It  does  not  appear  that  the  plaintiff  had  suf- 
fered any  damage.  For  anytliing  that  was 
shown,  tlie  goods  were  worth  the  jirice  agreed 
uponin  tlie  ojien  market.  Whiletlie  manifest 
tendency  of  the  cases  in  the  American  courts 
now  is  to  the  doctrine  lliat  when  the  vendor 
stands  in  the  position  of  a  complete  pert\)riii- 
ance  on  his  part  he  is  entitled  to  recover  tlie 
contract  price  as  liis  measure  of  damages,  in 
tlie  case  of  an  executory  contract  for  the  sale 
of  goods  not  specilic  the  rule  undoubtedly  is 
that  the  measure  of  damages  for  a  refusal  to 
leceive  the  goods  is  tiie  difference  between 
the  price  agreed  upon  and  the  market  value 
on  the  day  appointerl  for  delivery.  Judg- 
ment allirmed. 


^78 


RIGHTS  OF  UNPAID  SELLER  AdAINST  THE  GOODS. 


WIXDMULLEK  ct  al.  v.  TOPE  et  al.i 

(14  N,  E.  -iSVt.  107  N.  Y.  (>74.) 

Court  of  Appeals  of  New  York.     Dec.  G,  1887. 

Appeal  from  jjeiu'ral  term,  supreme  eourt,  first 
<l('])artuH'nt. 

.Vet  ion  broufjlit  hy  Louis  Windnuiller  and  Al- 
fred Uoelker  against  Tliomas  J.  Pope  and  .lames 
]•].  I'ope  to  recover  damages  from  defendants 
for  the  breach  of  a  written  contract  for  the  sale 
and  deliveiy  on  the  part  of  plaintiffs  of  about 
1.200  tons  of  old  iron  Vignol  rails,  to  be  ship- 
ped from  Europe.  The  cause  was  tried  before 
Larrcmore.  J.,  and  a  jury,  and  upon  verdict 
for  plaintiffs  judfimcnt  rendered  for  $19,480, 
the  amoimt  of  principal  and  costs.  On  appeal, 
the  f,'eneral  term  attirmed  the  judgment  against 
deft'ndants.  and  they  I)rin,ii-  the  case  to  the  court 
of  appeals. 

Carlisle  Norwood,  Jr.,  and  W.  W.  Niles,  for 
appellants.  Bemard  lioelker  and  Cephas  Brain- 
erd,  for  respondents. 

PER  CURIAM.  We  think  no  error  is  pre- 
sented upon  the  record  which  requires  a  re- 
versal of  the  judgment.  Tlie  defendants  hav- 
ing on  the  twelfth  of  .Tune,  1880,  notified  the 
plaintiffs  that  they  would  not  receive  the  iron 
rails,  or  pay  for  them,  and  having  informed 
them  on  the  next  day  that  if  they  brought  tlie 
iron  to  New  York  they  would  do  so  at  their 
own  peril,  and  advised  them  that  they  had  bet- 
ter stop  at  once  attempting  to  can-y  out  the 
contract,  so  as  to  make  the  loss  as  small  as 
possible,  the  plaintiffs  were  justified  in  treat- 
ing tlie  contract  as  broken  by  tlie  defendants 
at  tliat  time,  and  were  entitled  to  bring  the  ac- 
tion immediately  for  the  breach,  without  ten- 
dering the  deliveiy  of  the  iron,  or  awaiting 
the  expiration  of  the  period  of  performance  fixed 
by  the  contract;  nor  could  tlie  defendants  re- 
tract tlieir  renunciation  of  the  contract  after 
the  plaintitl"s  had  acted  upon  it,  and  by  a  sale 
of  the  iron  to  other  parties  change  their  posi- 
tion. Dillon  V.  Anderson,  43  N.  Y.  231;  How- 
ard V.  Daly.  01  X.  Y.  302;  Ferris  v.  Spooner, 
102  N.  Y.  12.  .J  N.  E.  773;  Hochster  v.  De  La 
Tour,  2  El.  &  Bl.  678;  Cort  v.  Railway  Co., 
17  Adol.  &  E.  (N.  S.)  127;  Crabtree  v.  Messer- 
smith,  19  Iowa,  179;    Benj.  Sales,  §§  567,  oftS. 

The  ordinary   rule  of  damages  in  an  action 

1  An  extract  from  this  opinion  is  reported  in 
107  N.  Y.  674;  but  the  opinion  is  here  given 
in  full,  as  reported  in  14  N.  E.  436. 


by  a  vendor  of  goods  and  chattels,  for  a  refusal 
by  the  vendee  to  accept  and  pay  for  them,  is 
the  difference  between  the  contract  price  and 
the  market  value  of  the  property  at  the  time 
and  place  of  delivery.  Dana  v.  Fiedler,  12  N. 
Y.  40;  Dustan  v.  McAndrew,  44  N.  Y.  72; 
Caheu  v.  Piatt,  69  N.  Y.  348.  The  just  applica- 
tion of  this  rule  to  the  circumstances  in  this 
case  requires  that,  in  computing  the  damages, 
the  defendants  should  be  credited  with  the  dif- 
ference between  the  freiglit  from  Croustadt  to 
New  York  fixed  by  the  charter-party,  less  the 
sum  wliich  it  cost  the  i)laintift"s  to  be  released 
from  the  charter,  and  also  with  any  other  ex- 
penses which  tlie  plaintiffs  would  natni'ally  have 
incurred  in  performing  their  contract  to  de- 
liver the  iron  in  New  York.  The  contract  price 
being  known,  and  the  market  price  of  the  iron  in 
New  York  at  the  time  of  the  breach  and  sub- 
sequently having  been  proved,  as  also  the  sura 
which  the  plaintiffs  paid  for  damages  and  ex- 
penses on  account  of  the  charter  and  the  cus- 
tomaiy  rate  of  insurance,  the  computation  of 
the  damages  was  a  simple  arithmetical  problem. 
All  these  elements  were  before  tlie  jury,  and 
the  verdict  does  not  exceed,  indeed  it  is  less, 
than  the  sum  wliich,  on  the  view  of  the  evi- 
dence most  favorable  to  the  defendants,  the 
plaintiff's  were  entitled  to  recover.  The  plain- 
tiffs on  the  trial  proved  the  marliet  value  of 
the  iron  at  St.  Petersburg,  where  it  was  at  the 
time  of  tlie  breach,  and  also  that  they  sold  it 
on  the  twelfth  of  July  at  a  certain  price.  The 
plaintiffs  also  gave  evidence  of  various  ex- 
penditures made  by  them,  which  It  is  unneces- 
sary to  recapitulate.  It  is  claimed  that  some 
of  these  items  could  not  properly  he  considered 
in  estimating  the  damages.  Assuming  that  this 
may  lie  true,  the  fact  remains  nevertheless  that 
the  verdict  is  fully  warranted  by  the  competent 
and  uncontradicted  evidence.  The  amount  of 
the  verdict  is  justified,  whether  the  maik  t  value 
of  the  iron  in  St.  Petersburg  or  NeAV  York  is 
taken  as  a  basis.  The  evidence  also  shows 
without  contradiction  that,  on  the  resale,  the 
iron  brought  its  full  marlcet  value,  irrespective 
of  storage,  and  it  is  not  imjiortant  to  determine 
whether  the  plaintiffs  could  fix  the  market  price 
by  a  sale  without  notice  to  the  defendants. 

There  is  no  merit  in  the  defense,  and  the 
exceptions  are  in  tlie  main  technical  and  frivo- 
lous, and  none  of  tliem  we  tliink.  recpiire  a  re- 
versal of  the  judgment.  The  judgment  is  there- 
fore aftinned.  All  concur,  except  RAPALLO, 
J.,  absent. 


RIGHT8  OF  UNPAID  SELLER  ACALXST  THE  GOODS. 


MOODY  V.  BROWN. 

(84  Me.  107.) 

Supreme  Judicial  Court  of  Maine.      1852.  _ 

On  exceptions  from  tbe  district  court;  Hatb- 
;i\vay,  -T. 

Assumi).sit.  on  account  for  materials  and  la- 
bor furnislied.  and  one  on  an  account  for  ar- 
ticles sold  and  delivered.  The  account  was 
for  stereotype  plates,  ?1S;  alteration  of  same, 
.$4;  and  some  interest  and  expressage.  making 
in  all  .$ii.").(>4. 

A  witness  for  the  plaintiff  testified  that  in 
behalf  of  the  plaintiff  he  presented  the  bill 
and  requested  payment,  to  which  the  defend- 
ant replied  that  he  had  ordered  the  plates,  but 
did  not  feel  able  to  take  them;  that  there  was 
a.  mistake  in  them  which  the  plaintiff"  was  to 
correct  at  his  o^^n  expense;  that  he  after- 
wards carried  the  i)lates  to  the  store  of  the 
defendant,  who  refused  to  take  them;  that  he 
left  them  there,  against  the  remonstrance  of 
the  defendant;  that  the  defendant  afterwards 
offered  to  pay  $20  for  the  whole  bill;  that  at 
a  still  subsequent  period,  the  witness  asked 
the  defendant  when  he  would  pay  the  ?20, 
who  replied  that  he  would  do  it  in  a  few  days; 
and  that  the  defendant  afterwards  repeatedly 
said  he  would  pay  the  twenty  dollars. 

The  judge  instructed  the  jury,  that,  If  de- 
fendant contracted  for  the  plates  to  be  made 
for  him.  and  refu.^ed  to  accept  them  when 
made,  although  he  might  be  liable  to  plain- 
tiff in  an  action  for  damages  for  not  fulhlling 
his  contract,  yet  he  would  not  be  liable  in  this 
action  for  their  value,  as  for  goods  sold  and 
delivered;  that  if  they  were  left  at  defeud- 
ant's  store  against  his  consent  and  remon- 
strance, such  a  proceeding  on  the  part  of 
plaintiff'  could  have  no  effect  to  vary  the  lia- 
bilities of  defendant. 

But  if  afterwards  defendant  offered  to  pay 
the  twenty  dollars  in  full  for  the  bill,  and  if 
that  offer  was  accepted,  the  plaintiff  would  be 
«^ntitled  to  recover  the  twenty  dollars  and  inter- 
est thereon  from  the  time  such  off"er  was  ac- 
cepted, but  that  defendant  would  not  be  bound 
by  that  offer,  imless  it  was  accepted. 

Before  SHEPLEY.  C.  J.,  and  WELLS, 
lilCE,  and  APPLETON,  JJ. 

J.  E.  Godfrey,  for  plaintiff".  Mr.  Simpson, 
for  defendant. 

SHEPLEY.  C.  J.  There  is  not  a  perfect 
agreement  of  the  decided  cases  upon  the  ques- 
tion presented  by  the  exceptions. 

The  law  appears  to  be  entirely  settled  in 
England  in  accordance  with  the  instructions. 
Atkinson  v.  Bell.  8  Barn.  &  C.  277;    Elliott  v. 


Pybus.  10  Biug.  .■"(12;  Clarke  v.  Spence,  4  Adol. 
&  E.  448. 

The  case  of  Bement  v.  Smith,  lo  Wend.  VX',, 
decides  the  law  to  be  otherwise  in  the  state 
of  New  York.  The  case  of  Towers  v.  Osborne, 
Strange,  ."jim;,  was  refi'rred  to  as  an  authority 
for  it.  The  plaintiff"  in  that  case  does  appear 
to  have  recovered  for  the  value  of  a  chariot, 
which  the  defendant  had  refused  to  take.  No 
(luestion  appears  to  ha\-e  been  made  resjiect- 
ing  his  right  to  do  so,  if  he  was  entitled  to 
maintain  an  action.  The  only  question  decid- 
ed was.  whether  the  case  was  within  the  st-it- 
ute  of  frauds. 

In  the  (a.se  of  Bement  v.  Smith.  C.  J.  Savage 
appears  to  have  considered  the  plaintiff  en- 
titled upon  principle  to  recover  for  the  value 
of  an  article  manufactured  according  to  order 
and  tendered  to  a  customer  refusing  to  re- 
ceive it. 

Tliis  can  only  bt  correct  upon  the  ground 
that  by  a  tender  the  property  i)asses  from  the 
manufacturer  to  tht  customer  against  his  will. 
This  is  not  the  ordinary  effect  of  a  tender.  If 
the  property  does  not  pass,  and  the  manufac- 
turer may  commence  an  action  and  recover  for 
its  value,  while  his  action  is  pending  it  may 
be  seized  and  sold  by  one  of  his  creditors,  and 
his  legal  rights  be  thereby  varied,  or  he  may 
receive  benetit  of  its  value  twice,  while  the 
customer  loses  the  value.  The  correct  prin- 
ciple appears  to  have  been  stated  by  Tindal, 
C.  J.,  in  the  case  of  Elliott  v.  Pybus.  that  tlie 
manufacturer's  right  to  recover  for  the  value 
depends  upon  the  question,  whether  the  prop- 
erty has  passed  from  him  to  the  customer. 
The  value  should  not  be  recovered  of  the  cus- 
tomer, unless  he  has  become  the  owner  of  the 
property,  and  can  protect  it  against  any  as- 
signee or  creditor  of  the  manufacturer. 

To  effect  a  change  in  the  property  there 
must  be  an  assent  of  both  parties.  It  is  ad- 
mitted that  the  mere  order  given  for  the  man- 
ufacture of  the  article  does  not  affect  the  title. 
It  will  continue  to  "oe  the  property  of  the  man- 
ufacturer until  completed  and  tendered. 
There  is  no  assent  of  the  other  part:*-  to  a 
change  of  the  title  exhibited  by  a  tender  and 
refusal.  There  must  be  proof  of  an  accei)t- 
ance  or  of  acts  or  words  respecting  it.  from 
which  an  acceptance  may  be  inferred,  to  pas» 
the  property 

This  appears  to  be  the  result  of  the  best- 
considered  cases. 

There  is  a  particular  class  of  ca.ses  to  which 
this  rule  does  not  apply,  where  the  customer 
employs  a  superintendent  and  pays  for  the 
property  manufactured  by  installments  as  the 
work  is  performed 

Exceptions  overruled. 


mo 


RIGHTS  OF  UNPAID  SELLER  AGALXST  THE  GOODS. 


GODDARD  V.  BLNNEY. 

(115  Mass.  450.) 

Supronu'  Judicial    Court   of   ^Lissadiusotts. 
SutTolk.     Sept.  4,  1874. 

Contrju-r  to  irc-ovor  the  iirico  of  a  bu.i,^!,'.v  built 
by  plJiiiititTf  for  defeudaut.  I'laintiff  a^need 
to  build  a  bu.iiii.v  for  defendant,  and  to  deliver 
it  at  a  certain  time.  Defendant  .uave  special 
directions  as  to  style  ami  finish.  The  buggy 
was  built  according  to  directions.  Before  it 
was  finished,  defendant  called  to  see  it,  and 
in  answer  to  plaintiff,  who  asked  him  if  he 
would  sell  it,  said  no;  that  he  would  keep  it. 
When  the  buggy  was  tinished,  plaintiff  sent  a 
bill  for  it.  which  defendant  retained,  promis- 
ing to  see  plaintiff  in  I'egard  to  it.  The  buggy 
was  afterwards  burned  in  plaintiff's  posses- 
sion. The  case  was  repoi'ted  to  the  supreme 
judicial  court. 

C.  A.  Welch,  for  plaintifif.  G.  Putnam,  Jr., 
for  defendant. 

A.MES.  J.  AVhether  an  agreement  like  that 
described  in  this  report  should  be  considered 
as  a  contract  for  the  sale  of  goods,  within  the 
meaning  of  the  statute  of  frauds,  or  a  contract 
for  labor,  services  and  materials,  and  there- 
fore not  within  tliat  statute,  is  a  question 
upon  which  there  is  a  conflict  of  authority. 
According  to  a  long  course  of  decisions  in  New- 
York,  and  in  some  other  states  of  the  Union, 
an  agreement  for  the  sale  of  any  commodity 
not  in  existence  at  the  time,  but  which  the 
vendor  is  to  nianufactui-e  or  put  in  a  condi- 
tion to  be  delivered  (.such  as  flour  from  wheat 
not  yet  ground,  or  nails  to  be  made  from  iron 
in  the  vendor's  hands),  ip  not  a  contract  of 
sale  within  the  meaniui:  of  the  stntnte.  Crook- 
shank  V.  Burrell.  18  Johns.  58;  Sewall  v. 
Fitch.  8  Cow.  215;  Robertson  v.  ^'aughn.  5 
Sandf.  1;  Downs  v.  Ross.  2;^  Wend.  270;  Eich- 
elberger  v.  M'CauIey.  5  Har.  &  J.  21:3.  In 
England,  on  the  other  hand,  the  tendency  of 
the  recent  decisions  is  to  treat  all  contracts 
of  such  a  kind  intended  to  result  in  a  sale, 
as  substantially  contracts  for  the  sale  of  chat- 
tels; and  the  decision  in  Lee  v.  Griffin,  1  Best 
&  S.  272,  goes  so  far  as  to  hold  that  a  contract 
to  make  and  fit  a  set  of  artificial  teeth  for  a 
patient  is  essentially  a  contract  for  the  sale  of 
goods,  and  therefore  is  subject  to  the  provi- 
sions of  the  statute.  See  Maberley  v.  Shep- 
pard,  10  Ring.  !t9;  Howe  v.  Palmer,  3  Barn.  & 
.\ld.  :i21;  Baldey  v.  Parker.  2  Barn.  &  C.  37; 
Atkinson  v.  Bell.  8  Barn.  &  C.  277. 

In  iliis  commonwealth,  a  rule  avoiding  both 
of  these  extremes  was  established  in  Mixer  v. 
Howarth.  21  Pick.  205,  and  has  been  recogniz- 
ed and  athrmed  in  repeated  decisions  of  nioi-e 
recent  date.  The  effect  of  tliese  decisions  we 
understand  to  be  this,  namely,  that  a  contract 
for  the  sale  of  articles  then  existing  or  such  as 
the  vendor  in  the  ordinary  course  of  his  busi- 
ness manufactures  or  procures  for  the  general 
market,  whether  on  hand  at  the  time  or  not, 
is  a  contract  for  the  sale  of  goods,  to  which 
the  statute  applies.      But   on  the  otlier  hand, 


if  the  goods  are  to  l)e  manufactured  especially 
for  the  purchaser,  and  upon  his  special  or- 
der, and  not  for  the  general  market,  the  case 
is  not  within  the  statute.  Spencer  v.  Cone,  1 
-Mete.  (Mass.)  283.  "The  distinction,"  says 
Chief  Justice  Shaw,  in  Lamb  v.  Crafts,  12 
:Metc.  (Mass.)  353,  "we  believe  is  now  well 
understood.  When  a  person  stipulates  for 
the  future  sale  of  articles,  which  he  is  habit- 
ually making,  and  which,  at  the  time,  are  not 
made  or  tinished.  it  is  essentially  a  contract  of 
sale,  and  not  a  contract  for  labor;  otherwise, 
when  the  article  is  made  pursuant  to  the 
agreement."  In  Gardner  v.  Joy.  9  Mete. 
(Mass.)  177,  a  contract  to  buy  a  certain  num- 
ber of  boxes  of  candles  at  a  fixed  rate  per 
pound,  which  the  vendor  said  he  would  manu- 
facture and  deliver  in  about  three  months, 
was  held  to  be  a  contract  of  sale  and  within 
the  statute.  To  the  same  general  effect  are 
Waterman  v.  Meigs.  4  Cush.  497.  and  Clark  v. 
Nichols,  107  Mass.  547.  It  is  true  that  in 
"the  infinitely  various  shades  of  different  con- 
tracts," there  is  some  practical  difficulty  in 
disposing  of  the  questions  that  arise  under 
that  section  of  the  statute.  Gen.  St.  c.  105, 
§  5.  But  we  see  no  ground  for  holding  that 
there  is  any  uncertainty  in  the  rule  itself.  On 
the  contrary,  its  correctness  and  justice  are 
clearly  implied  or  expressly  affirmed  in  all  of 
our  decisions  upon  the  subject  matter.  It  is 
proper  to  say  also  that  the  present  case  is  a 
much  stronger  one  than  Mixer  v.  Howarth.  In 
this  case,  the  carriage  was  not  only  built  for 
the  defendant,  but  in  conformity  in  some  re- 
spects with  his  directions,  and  at  his  request 
was  marked  with  his  initials.  It  was  neither 
intended  nor  adapted  for  the  general  market. 
As  we  are  by  no  means  prepared  to  overmle 
the  decision  in  that  case,  we  must  therefoi'i> 
hold  that  the  statute  of  frauds  does  not  a]>ply 
to  the  contract  which  the  plaintiff  is  seeking 
to  enforce  in  this  action. 

Independently  of  that  statute,  and  in  cases 
to  which  it  does  not  apply,  it  is  well  settled 
tliat  as  between  the  immediate  parties,  proj)- 
erty  in  personal  chattels  may  pass  by  bargain 
and  sale  witliout  actual  delivery.  If  the  par- 
ties have  agreed  upon  the  .specific  thing  that 
is  sold  and  the  price  that  tlie  buyer  is  to  pay 
for  it,  and  nothing  remains  to  be  done  but  that 
the  buyer  should  pay  the  price  and  take  the 
same  thing,  the  property  passes  to  the  buyer, 
and  with  it  the  risk  of  loss  by  fire  or  any  oth- 
er accident.  The  appropriation  of  the  chattel 
to  the  buyer  is  equivalent,  for  that  purpose, 
to  delivery  by  the  seller.  The  as.seut  of  the 
buyer  to  take  the  specific  chattel  is  equivalent 
for  the  same  ptupcse  to  his  acceptance  of  pos- 
.session.  Dixon  v.  Yates,  5  Barn.  &  Adol.  313, 
340.  The  property  may  well  be  in  the  buyer, 
tliough  the  riglit  of  possession,  or  li  i  for  the 
price,  is  in  tlie  seller.  There  could  in  fact  be 
no  such  lien  without  a  change  of  owntnsliip. 
No  man  can  be  said  to  have  a  lieu,  in  the 
proper  sense  of  the  term,  upon  his  own  proj)- 
erty,  and  the  seller's  lien  can  only  be  upon  the 
buyer's  property.      It  has  often  been  decided 


ItlGIITS  OF  INPAII*  SKLLEK  A<iAINST  THE  GOODS. 


.381 


that  assumpsit  for  tlie  price  of  iiroods  bar- 
^aiiu'il  aud  sold  cau  be  uiaiutaiued  where  the 
jroods  have  been  selected  by  tlie  buyer,  aud 
set  apart  for  him  by  the  seller,  thoujrh  not 
iictually  delivered  to  him.  and  where  nothing 
remains  to  be  done  except  tliat  the  buyer 
should  pay  the  agreed  price.  In  such  a  state 
of  things  the  property  vests  in  him,  aud  with 
it  the  risk  of  any  accident  that  may  happen  to 
the  goods  iu  the  meantime.  Noy,  Max.  89. 
2  Kent.  Comm.  (12th  i:d.)  492.  Bloxam  v. 
Sanders.  4  Barn.  &  C.  941.  Tarling  v.  Baxter, 
<■>  Barn.  &  C.  3(!0.  Hinde  v.  Whitehouse.  7 
Ea.st.  r)71.  Macomber  v.  Parker,  13  Pick.  175, 
183.     Mor.se  v.  Sherman,  lOH  Mass.  430. 

In  the  present  case,  nothing  remained  to  be 
done  on  the  part  of  the  plaintiff.  The  price 
nad  been  agreed  upon;  the  specific  chattel  had 
been  finished  according  to  order,  set  apart 
and  api»roi)rlated  for  the  defendant,  and  mark- 
ed   with   hi.;-,   initials.     The  plaintiff   had   not 


undertaken  to  deliver  it  elsewhere  than  on  his 
own  premises.  He  gave  notice  that  it  was 
fini.shed,  and  presented  his  bill  to  the  defend- 
ant, who  promised  to  pay  it  soon.  He  had 
previously  requested  that  the  carriage  should 
not  be  sold,  a  request  which  substantially  i.s 
equivalent  to  asking  the  plaintiff  to  keep  it 
for  him  when  finished.  Without  contending 
that  these  circumstances  amount  to  a  delivery 
and  ac(ei)tance  within  the  statute  of  frauds, 
the  plaintiff  may  well  claim  that  enough  ha.s 
been  done,  in  a  case  not  within  that  statute, 
to  vest  the  general  ownership  in  tlie  defend- 
ant, and  to  ca.st  upon  him  the  risk  of  loss  by 
Are,  while  the  chattel  remained  in  the  plain- 
tifC's  possession. 

According  to  the  terms  of  th-e  reservation, 
the  verdict  must  be  set  aside,  and  judgment 
entered  for  the  plaintiff. 

COLT  ami  KIXDICOTT,  JJ.,  absent. 


382 


REMEDIES  OF  THE  BT'YER. 


HEWSOX-HERZOG  SUrPLY  CO.   v.  MIN- 
NESOTA BRICK  CO. 

(57  N.  W.  129,  55  Minn.  580.) 

Supreme  Court  of  Minnesota.     Dec.   21.   1S03. 

Appeal  from  district  court,  Hennepin  coun- 
ty;   Otis.  Judso. 

Action  by  the  Hewson-IIer/.oj,'  Supply  Com- 
pany aifainst  the  Minnesota  Brick  Company 
for  breach  of  contract.  TIier(>  was  a  verdict 
for  plaintiff,  and  from  an  order  grantius  a 
new  trial  it  appeals.    Atflrmed. 

Fletcher.  Itockwood  &  Dawson,  for  appel- 
lant.    Youn.ir  <S:  liightner,  for  respondent. 

BFCK.  J.  This  action  w%as  brou.iilit  to  re- 
cover damages  on  account  of  defendant's 
failm-i>  to  manufacture  and  deliver  brick  to 
tlie  plaintiff  according  to  the  conditions  of  a 
written  contract  made  between  the  parties, 
and  dated  April  1,  1S!)0.  Upon  the  trial  the 
court  below  directed  the  jury  to  find  a  ver- 
dict in  favor  of  the  plaintiff  for  the  sum  of 
)?2().-115.  Subsequently,  on  defendant's  mo- 
tion, the  court  gi-anted  a  new  trial,  upon  the 
ground  that  the  evidence  as  to  damages 
was  insufUcient,  and  from  this  order  the 
plaintiff  appeals. 

The  contract  provides  that  the  defendant 
shall  manufacture  and  sell  to  the  plaintiff, 
during  the  season  of  1S90,  all  the  pressed 
brick  to  be  made  by  the  defendant  at  its 
yards  at  AYheeler,  Dunn  county.  Wis.,  and 
to  burn,  and  have  ready  for  shii)ment  dur- 
ing the  season  commencing  on  or  before  June 
9.  1S90,  good  merchantable  pressed  brick, 
equal  in  all  respects  to  the  best  stock  brick 
of  the  St.  Louis  Hvdraulic  Press  Brick  Com- 
pany, of  St.  Louis.  Mo.,  in  Aveight,  finish, 
and  trueness.  and  of  color  equal  to  the  sam- 
ples, to  the  number  of  not  less  than  3.0;>0.000. 
and  as  many  more  as  defendant  could  make, 
up  to  the  number  of  G.OOO.OOO.  and  to  ship 
in  accordance  with  instructions  of  the  sup- 
ply company,  and  furnish  daily  reports  of 
bricks  made,  and  shipped,  and  on  hand. 
The  plaintiff  was  to  sell  and  dispose  of  said 
brick  in  any  market  it  deemed  best,  and  to 
pay  defendant  $13.50  per  thousand  for  such 
brick  on  board  cars  at  defcnulanfs  yards 
at  ^Yheeler,  Wis.,  upon  the  basis  of  $2. .50  pn- 
thousand  for  freight  to  St.  Paul  or  Min- 
neapolis, and,  if  the  freight  was  greater  thai: 
this  amount.  th(»  differcnice  should  be  deduct- 
ed from  the  .$13..50  per  thousand  for  the 
brick.  The  payments  were  to  be  made 
monthly  in  cash  on  aU  brick  sold  and  de- 
livered during  the  current  month,  and  plain- 
tiff was  to  sell  for  immediate  delivery  the 
brick  so  manufactured  as  soon  as  they  were 
made  and  ready  for  shipment,  and  to  sell 
on  or  before  January  1,  1891.  not  less  than 
3.<K)0.0(M)  pressed  brick,  and  as  many  more 
as  possible,  up  to  the  total  amount  of  the 
outiiut  of  defendant.  The  defendant  made 
various  attempts  to  manufacture  the  brick 
mentioned   in  the  contract,  but  did  not  suc- 


ceed, and  it  was  unable  to  furnish  the  plain- 
tiff with  the  amount  of  brick  required  by 
the  terms  of  the  contract,  only  a  few  thou- 
sand being  furnished.  By  reason  of  this  fail- 
ure, the  plaintiff  alleged  that  it  was  dam- 
aged in  tile  sum  of  !f!27,(XX).  In  its  memoran- 
dum attached  to  the  order  gi'anting  a  new 
trial,  th(^  com-t  below  states  as  the  gi'ound 
for  so  doing  that  the  evidence  as  to  damage^ 
was  insutticient  to  sui)port  the  verdict.  This 
view  of  the  case  is  fully  warranted  by  the 
record,  and  we  cannot  see  how  the  court 
could  properly  have  done  otherwise. 

There  were  several  erroneous  rulings  of 
the  court  below  in  the  admission  and  ex- 
clusion of  evid(Mice,  which  finally  led  up  to 
the  order  directing  the  .im-y  to  find  a  ver- 
dict for  plaintiff,  whereby  his  rights  were 
greatly  prejudiced.  It  appears  that  the  de- 
fendant was  a  manufacturer  of  brick,  and 
the  plaintiff  a  jobber,  middleman,  or  whole- 
sale dealer,  bargaining  for  the  entii'e  out- 
put of  the  defendant's  yards,  with  the  view 
of  reselling  the  brick  at  a  profit.  To  more 
fully  understand  the  situation  of  the  case, 
we  state  that  it  appears  from  the  evidence 
that  the  officers  or  agents  of  the  respective 
parties,  at  the  time  of  the  making  of  the 
contract,  had  their  offices  in  the  same  room 
in  a  building  in  the  city  of  St.  Paul,  and 
so  continued  until  some  time  in  the  month 
of  November,  1S91,  and  that  plaintiff  had 
the  exclusive  agency  or  contract  with  the 
St.  Louis  Hydraulic  Press  Brick  Company 
for  some  time  prior  to  the  date  of  the  con- 
tract between  these  parties,  and  dvu'ing  the 
entire  period  covered  by  the  contract,  and 
for  a  long  time  thereafter,  under  which  it 
was  enal)led  to  purchase,  and  did  purchase, 
brick  of  the  character  in  suit  at  the  price  of, 
.$10  per  thousand  at  St.  Louis,  the  freight 
thereon  from  St.  Louis  to  St.  Paul  and  Min- 
neapolis up  to  September  1.  1890.  being  $5.51, 
making  tlu^  cost  price  in  those  places  $21.51. 
and  from  that  date  to  January  1.  1891.-  $(').().",. 
making  the  cost  price  at  same  places  $22.03. 
The  St.  Isolds  Brick  Conqiany  was  a  large 
manufacturer  of  this  kind  of  brick,  and  was 
always  able,  ready,  and  willing  to  fill,  and 
did  fill,  all  such  orders  for  this  kind  of  brick 
for  the  plaintiff"  as  it  desired,  and  Avhich 
brick  plaintiff'  was  at  liberty  to  sell  at  St. 
Paul,  Minneapolis,  and  in  the  cities  of  Still- 
water, St.  Cloud,  and  smaller  places  in  the 
surroundintr  country,  except  that  it  was  not 
perudtted  to  sell  the  St.  Louis  brick  at  Du- 
luth  or  Supei-ior.  On  the  trial  the  plain- 
tiff was  pernutted  to  show  by  two  witnesses, 
against  the  objections  of  defendant,  that  the 
market  value  of  the  pressed  brick  of  the 
character  described  in  the  contract  was  $28 
per  thousand  at  Minneapolis,  but  on  cross- 
examination  they  testified  that  this  price  or 
market  value  was  that  which  the  jobber  or 
agent  charged  to  the  builder,  and  not  the 
price  or  value  of  such  brick  when  sold  by 
the  manufacturer  to  a  jobber  or  agent,  an<l  • 
that  as   to  such    prices  or  values   thej'    had 


REMEDIES  OF  THE  BUYER. 


5S3 


no  knowlodjEce.  Upon  this?  suhjoct  no  other 
testimouj'  was  given  by  plaintiff,  although 
its  principal  managing  officers  were  ex- 
amined as  witnesses  upon  the  trial.  A  wit- 
ness for  the  defendant  testified  that  there 
was  a  differ(>nce  in  tlie  market  price  or  value 
of  brick  sold  by  the  manufacturer  to  the 
jobber  or  agent,  and  the  price  or  market 
value  of  brick  sold  by  the  jobljer  or  agent 
to  the  builder  or  contractor,  which  evidence 
was  not  disputed.  The  court  below  held  the 
measure  of  damages  to  be  the  difference  be- 
twtvn  the  contract  price  of  the  brick  de- 
livered in  8t.  Paul  or  Minneapolis,  viz.  .$16 
per  thousand,  and  the  price  which  the  jobber 
or  middleman  charged  or  sold  the  brick  to 
tlie  builder  or  contractor  viz.  $2S  per  thou- 
sand, but  limited  the  amount  of  the  recov- 
ery to  !?D  per  thousand,  because  the  plaintiff 
only  demanded  that  amount  in  its  pleadings. 
In  cases  of  this  kind,  no  more  damages  can 
be  recovered  than  such  as  were  within  the 
contemplation  of  the  parties  when  the  con- 
tract was  entered  into,  and  which  would 
likely  result  from  a  breach  thereof;  for  the 
familiar  rule  may  be  applied  here  "that  the 
intention  of  the  parties  is  to  be  ascertained 
from  the  whole  contract,  considered  in  con- 
nection with  the  svu'rounding  circumstances 
known  to  both  parties."  It  cannot  be  reason- 
ably or  legally  claimed  that  these  parties 
ever  contemplated  that,  if  the  defendant  was 
unable  to  perform  the  conditions  of  its  con- 
tract, the  measm'e  of  damages  should  be  the 
difference  between  the  price  of  the  brick  to 
the  plaintiff  at  St.  Paul  or  Minneapolis,  viz. 
.$1G  per  thousand,  and  the  price  which  the 
plaintiff,  as  jobber,  charged  or  sold  the  brick 
for  to  the  builder  or  contractor.  Such  a  nile 
or  measm-e  of  damages  would  compel  the 
defendant  to  pay  the  plaintiff  all  the  ex- 
pense of  carrying  on  its  business,  including 
the  value  of  time  spent,  costs  of  handling, 
and  other  incidental  expenses  attending  the 
sale  of  3.000.000  brick  at  retail,  for  a  period 
of  nine  months  at  least,  the  time  covered 
by  the  contract.  The  result  would  also  be 
that  the  plaintiff  would  receive  a  greater  sum 
as  damages  by  reason  of  the  defendant's 
defaidt  than  it  could  obtain  as  profits  if  the 
defendant  had  performed  all  the  conditions 
of  its  contract  with  plaintiff.  This  is  not 
the  compen.sation  as  damages  which  the  law 
permits  by  reason  of  the  breach  of  a  con- 
tract. The  rule  stated  as  law  in  Sutherland 
on  Damages  (volume  1.  p.  17)  is  this:  "This 
universal  and  cardinal  principle  is  that  the 
person  injured  shall  receive  a  compensation 
commensurate  with  his  loss  or  injury,  and 
no  more;  and  it  is  a  right  of  tlie  person 
who  is  bound  to  pay  this  compensation  not 
to  bo  compelled  to  pay  more,  except  costs." 
Plaintiff  was  not  entitled  to  recover,  as  dam- 
ages, any  greater  sum  than  the  difference 
between  the  contract  price  of  the  brick  at 
St.  Paul  and  Minneapolis,  viz.  $10  per  thou- 
sand, in  the  quantities  and  at  the  periods 
mentioned  in  the  contract,   and   the  market 


value  at  those  places  which  it  would  have 
to  pay  as  jobbers  or  middlemen  for  brick  of 
a  similar  kind,  and  in  the  quantities  which 
it  was  entitled  to  receive  under  its  contract, 
(Tower  Co.  v.  Phillips,  23  Wall.  471;)  and 
this  rule  of  damages  nmst  be  (lualitied  as 
to  this  case  by  another  one,  to  be  stated 
hereafter. 

The  plaintiff"  was  not  entitled  to  recover 
the  dam.-iges,  in  one  lump  sum,  which  result- 
ed from  the  defendant's  breach  of  contract, 
for  all  of  these  brick  were  not  to  be  delivered 
at  one  time,  nor  in  on(»  gross  or  total  quan- 
tity, but  in  different  (piantities  and  at  dif- 
ferent periods.  The  rule  seems  to  be  pretty 
well  settled  that  where,  under  a  contract 
of  sale,  goods  are  to  be  delivered  at  certain 
specified  periods  and  in  specified  (luantities, 
and  as  such  i)eriml  arrives,  if  no  delivery  <  • 
only  a  partial  delivery  takes  place,  the  dam- 
ages are  to  be  estimated  as  of  those  periods 
when  such  contract  ought  to  have  been  per- 
formed. Wood's  Mayne,  Dam.  §  200.  And  the 
rule  is  there  further  stated  that  "if  the  de- 
fendant absolutely  repudiates  his  contract 
at  any  period  previous  to  the  final  date  speci- 
fied, and  the  plaintiff  elects  to  treat  the 
contract  at  an  end.  yet  in  considering  the 
question  of  damages  they  will  still  be  esti- 
mated with  reference  to  the  times  at  which 
the  contract  ought  to  have  been  performed." 
If  this  were  not  the  ride,  there  might  be 
great  injury  and  injustice  done  to  a  party 
where  the  periods  of  performance  extended 
through  a  great  many  years,  and  the  market 
prices  or  values  might  vary  during  the  dif- 
ferent periods  of  performance  of  the  con- 
tract. 

We  are  also  of  the  opinion  that  the  court 
below  erred  in  striking  out  the  evidence  in 
regard  to  the  conditions  existing  between  the 
plaintiff'  and  the  St.  Louis  Brick  Company. 
That  there  was  a  breach  of  the  contract  be- 
tween these  parties  on  the  part  of  the  defend- 
ant was  well  established,  and  the  question 
to  be  determintxl  is  as  to  the  extent  of  the 
defendant's  liability  upon  such  default. 
There  was  neither  fraud,  nor  intent  on  its  part 
to  produce  such  default,  but.  on  the  contr.iry, 
it  seemed  to  make  gi-eat  effort  to  fulfill  its 
duty  and  obligations  to  the  plaintiff  in  this 
respeit.  In  such  case  it  was  the  duty  of  the 
plaintiff  to  render  the  injiu'y  or  damages  as 
light  as  possible.  It  could  not.  by  its  negli- 
gence or  by  its  want  of  reasonable  exertion, 
unnecessarily  enhance  the  amount  of  damages 
to  which  the  def(>ndant  woidd  be  liable  by 
reason  of  its  breach  of  the  contract.  When 
a  party  is  injuretl  by  nonperformance  of  a 
contract,  especially  of  the  kind  existing  be- 
tween these  parties,  the  other  party,  if  he  has 
it  in  his  power,  is  bound  to  lessen  the  dam- 
ages if  he  can  do  so  by  rt>asonable  exertions, 
and,  if  he  is  necessarily  compelled  to  per- 
form more  labor  or  put  to  gi-eater  expense, 
tl'.ese  are  matters  which  are  prop;'i'ly  chargea- 
ble against  the  party  in  defaidt;  and.  if  a 
party  who  is  entitled  to  the  benefits  of  a  con- 


:J81 


Ki:.MKi>ii:s  OF  '11I1-:  p.rvicK. 


tract  receives  notice  from  the  other  i);irty 
that  he  cannot  perform  its  conditions,  tlien  it 
is  tlie  duty  of  such  party  to  save  tlie  party  in 
default,  as  far  as  it  is  in  liis  i)o\ver  to  do  so, 
all  furtlier  damafjes.  thou^;Ii  tlie  performance 
of  tliis  duty  may  call  for  atlirmative  action, 
(1  Su(h.  Dam.  pp.  ]4!)-ir)l;)  and,  wlici'e  all 
the  facts  and  surrouudintc  circumstances  are 
•sidiicient  to  fully  satisfy  the  party  not  in  de- 
fault that  the  other  party  cannot  and  will  riot 
perform  the  conditions  of  the  contract  be- 
tween them,  he  should  also  use  reasonable 
exertions  to  save  the  party  in  defaidt  from 
further  dam;is;es.  It  api)("ars  in  this  case 
that  the  phiintiff.  at  all  times  durin,;;  the  ex- 
istence of  this  contract,  had  it  in  its  power 
to  procm-e  brick  of  the  St.  I^ouis  Brick  Com- 
pany, of  the  kind  and  quantity  called  for  by 
this  contract,  at  St.  Paul  or  Minneapolis, 
with  freight  charges  added,  making  the  ad- 
ditional expense  about  $(;  per  thousand.  The 
tiuantities  and  kind  of  brick  required  or 
needed  could  always  be  obtained  by  the 
plaintiff  without  delay  or  trouble.  It  had  an 
extensive  territory  in  which  to  sell  its  St. 
Louis  brick,  and  it  does  not  app(^ar  that  any 
of  its  customers  ever  complained  of  the 
price,  or  that  they  were  not  supplied  in  the 
quantity,  and  of  the  kind,  and  at  the  times 
needed  by  them.  The  only  difference  to  the 
plaintiff  was  the  co.st  price  of  the  brick  at 
St.  Paul  and  Minneapolis.  The  measure  of 
damages,  then,  which  plaintiff  was  entitled 
to  recover,  if  upon  the  whole  case  it  proved 
its  cause  of  action,  was  the  difference  be- 
tween the  cost  price  of  the  defendant's  brick, 
as  shown  by  the  contract,  and  the  St.  Louis 
brick  delivered  in  St.  Paul  and  Minneapolis, 
and  which  plaintiff  had  to  pay  for  as  jobber. 
This  nile  is,  of  course,  applied  to  this  case 
up.m  the  evidence  found  in  tlie  record,  and 
should  not  be  rendered  inapplicable  by  rea- 
.son  of  the  fact  that  the  plaintiff  was  author- 


ized to  sell  the  defendant's  brick  in  the  cities 
of  Duluth  and  Superior,  some  150  miles 
distant  from  St.  Paul  and  Minneapolis,  but 
was  prohibited  from  selling  the  St.  Louis 
bi-ick  in  those  place^;.  But  the  above  mensuro 
of  damages  shoiUd  be  modified  or  quali!it>d 
as  to  the  amount  of  brick  needed  or  required 
to  supjily  the  demands  of  its  customers  at 
Doluth  and  Superior,  and  upon  another  trial 
it  should  be  permitted  to  show,  if  it  can  do 
so.  the  amount  of  damage  it  sustained  by 
reason  of  the  defendant's  default  in  not  fur- 
nishing it  with  the  quantity  of  brick  ne«Kled 
to  sui»])ly  such  customers  at  those  plac(>s 
Juring  the  existence  of  the  contract.  The 
plaintiff  had  no  right,  however,  to  demand 
of  the  defendant  that  the  bnck  so  to  Ini 
aiauufactured  should  be  delivered  to  it  at 
Duluth  or  Superior,  but  only  on  the  cars  at 
Wheeler,  Wis.  It  appears  that  St.  Paul  and 
Minneapolis  were  the  market  places,  nearest 
to  Wheeler,  for  such  kind  of  brick.  It  may 
be  difiicult  to  establish  a  just  measure  of 
damages  as  between  these  parties  in  this 
case,  in  view  of  the  complicated  conditions 
existing  as  to  the  Duluth  and  Superior  terri- 
tory; but  -we  think  that  the  measure  of  dam- 
ages, as  applied  to  that  territory,  should  be 
the  diff'erence  between  the  contract  price  of 
the  brick  at  Wheeler,  Wis.,  viz.  .^lo.oO  per 
thousand,  with  the  cost  of  freight  to  those 
places  or  territory  added,  and  the  price 
which  plaintiff"  could  as  a  jobber  or  middle 
man  procure  brick  for,  at  the  lowest  market 
value,  or  for  a  less  price  if  reasonably  possi- 
ble, of  a  similar  kind,  and  in  siitficient  quan- 
tities, and  at  the  times  mentioned  in  the  con- 
ti-act,  to  the  amount  or  quantity  which  it 
could  sell  or  needed  at  those  places.  We 
constiiie  the  contract  in  question  as  one  of 
sale,  and  not  one  of  agency.  The  order 
gTanting  a  new  trial  is  affirmed. 


REMEDIES  OF  THE  BUYER. 


38J 


Rl'SSELL   et    al.    v.    IKJRN,    BR  ANNEX    & 
FORSYTH   MANL'F'G  CO. 

(59  N.  W.  901,  41  Neb.  567.) 

Snprome  Court  of  Nebraska.     June  2(>.  1894. 

Error  to  district  court,  Douglas  county;  A. 
N.  Ferj^son,  Jud^'e. 

Action  by  the  Horn,  Branuen  &  Forsyth 
Manufactiiriuj;  Company  a^^ainst  T.  M.  Rus- 
sell and  O.  H.  Pratt,  partners  doing  business 
as  Russell.  Pratt  &  Co.  .ludpment  for  plain- 
tiff, and  defendants  brin;,'  error.     Reversed. 

Kennedy  &  Learned,  for  plaintiffs  in  error. 
Breckeuridfjre,  Breckenridfie  &  Crofoot,  for 
defendant  in  error. 

IRVINE.  C.     The   Horn.  Rrannen  &  For- 
syth    .Manufacturing    Company,    hereinafter 
called  the  "Horn  Company."  brought  an  ac- 
tion in  the  district  court  of  Douglas  county 
to  recover  from   F.   M.   Russell  and   Orlo  H. 
Pratt,  copartners  doing  business  as  Russell, 
Pratt  &:  Co..  and  hereinafter  referred  to  as 
'•Russell   &   Pratt."   $1,285.22,    with  interest, 
alleged  to  be  due  the  Horn  Company  as  a  bal- 
ance for  goods  sold  and  delivered  to  Russell 
&  Pratt.     The  account  attached  to  the  pe- 
tition   showed    charges    against    Russell  & 
Pratt    amounting    to    $4,502.93,    and    cred'ts 
amounting    to    .$3,277.71.     Russell    &    Pratt 
answered,  admitting  payments  to  the  Horn 
Company  of  large   sums  of  money   for   gas 
fixtui'es  and  merchandise  sold  and  delivered 
to  Russell  &  Pratt,  but  denying  indebtedness 
to  any  amount,  and  further  denying  every 
allegation  of  the  petition  not  expressly  ad- 
mitted.    The  answer  then  set  up  three  coun- 
terclaims;   the   first  being  for   $l.()8ij.tj5,   as 
commission  and  profits  to  wnich  Russell  & 
Pratt  were   entitled   on   the  sale  of  certain 
gas  and  electrical  fixtures  to  one  Hendrix,  it 
being  charged  that  the  list  price  of  said  fix- 
tures was  $1,898.10,  and  that,  under  the  con- 
tact existing  between  the  parties,  Russell  «S: 
Pratt  were  entitled,  as  their  profit  on  said 
transaction,  to  .50,  10,  and  5  per  cent,  of  said 
list  price.     The  second  counterclaim  charged 
that  on  March  1,  1889.  an  agi'eement  was  en- 
tered into  between  the  Horn  Company  and 
Russell  &  Pratt  whereby  the  Horn  Company 
agreed  to  give  Russell  &  Pratt  the  exclusive 
agency  for  its   wares  for    the   state  of   Ne- 
braska and  certain  otlier  territory,  and  agreed 
not  to  sell  any  of  its  fixtures  to  or  through 
any  other  person  within  the  territory   men- 
tioned   save    to    Russell    &   Pratt;    that   the 
agi'eenient  was  to  remain  in  force  for  one 
year;    that  the  Horn   Company,  in  violation 
of  its  agreement,  sold  to  and  through  other 
persons  in  the  city  of  Omaha,  and  elsewhere 
in  the  territory  mentioned,  fixtures  and  mer- 
chandise covered  by  the  agreement,  whereby 
Russell  &  Pratt  were  deprived  of  large  prof- 
its,  and  were  unable  to  dispose  of  a  large 
quantity  of  merchandise  purchased  from  the 
Horn  Company  in  reliance  upon  such  agi'ee- 
ment;    wherefore  damages    were   prayed  in 
the  sum  of  $1,200.     The  third  counterclaim 

VAN  Z.(LE  SEL.CAS.SALES — 25 


alleged  that  on  May  13,  1890,  they  ordei-ed 
from  the  Horn  Company  merchandise  at  the 
agreed  price  of  $048.50,  which  order  was  ac- 
cepted by  the  Horn  Comjiany,  and  which  the 
Horn  Company  agreed  to  fiU,  but  subsequent- 
ly refused  to  fill,  to  Russell  &  I'ratfs  dam- 
age in  the  sum  of  $373.74.  The  reply  was  a 
general  denial.  There  was  a  trial  to  a  jury, 
and  a  verdict  and  judgment  for  the  Horn 
Company  for  $922.17,  from  which  Russell  & 
Pratt  prosecute  error. 

Certain  rulings  of  the  court  on  the  admis- 
sion and  rejection  of  evidence  are  discus.sed 
in  the  briefs,  but  cannot  be  considered,  for 
the  reason  that  the  assignments  of  error  do 
not  point  out  the  rulings  complained  of.    Up- 
on the  subject  of  the  first  counterclaim, — the 
sale  of  goods  to  Hendrix, — the  evidence  tend- 
ed   to    show    that   Hendrix    was    erecting    a 
number  of  houses,  and  that  Russell  &  I'ratt 
had  made,  or  caused  to  be  made,  two  bids 
for  furnishing  gas  fixtures  therefor.     These 
bids  contemplated  the  use  of  fixtures  other 
than  those  of  the  Horn  Company's  manufac- 
ture.    Mr.  Ryan,  a  traveling  salesman  of  the 
Horn  Company,  appeared  in  Omaha.     At  the 
request  of  Russell  &  Pratt,  he  went  with  Mr. 
RiLssell  to  Balfe  &  Read,  who  were  gas  fit- 
ters in  Omaha,  was  introduced  to  a  member 
of  that  firm  by  Russell,  and  made  for  Balfe 
&  Read  an  estimate  for  the  fixtures  for  the 
Hendrix     houses.     The    bid     formvdated    by 
Balfe   &   Read   upon   that   estimate   was  ac- 
cepted  by  Hendrix,   and  the  goods  sold   di- 
rectly,   without    the    further   intervention    of 
Russell  &  Pratt.     RusseU  &  Pratt  claim  that  it 
was   the  agreement  between   them   and   the 
Horn    Company    that    the    Horn    Comp  iny's 
salesman  shoidd  assist  them  when  desired  in 
making  sales;   that  Ryan  acted  ostensibly  for 
that  purpose;    that  it  was  the  imdei-standing 
with  Ryan  that,   while  he  should   make  the 
estimate,    the    sale    was    to    be    to    Balfe    & 
Read  on  behalf  of  Russell  &  Pratt,  not  a  di- 
rect sale  by  the  Horn  Company;    that  Rus- 
sell &  Pratt  would   be  entitled  under   their 
agi-eement   to  purchase  the  goods   at  a  dis- 
count of  $1,080.05  from   the  list  price;    and 
that,  in  violation  of  their  contract  with  the 
Horn  Company,  they  were  deprived  of  this 
sum,  by  reason  of  Ryan's  making  the  sale 
directly.     There  was  evidence  tending  to  es- 
tablish this  contention.     The  Horn  Company 
claims  that  it  was  the  voluntary  proposition 
of  Russell  &  Pratt  that  Ryan  should   make 
the  estimate  and  the  sale,  and  that  Russell 
&  Pratt   had  in   this   instance   waived    their 
right    of  insisting   that    the   Horn    Company 
should    sell   no   goods    except    through    thi-m. 
This    contention    is    also    not    without    some 
support    in    the    evidence.      Upon    this    suh 
jicc.     tlie    court,   at     the    Horn     Company's 
request,     instructed     the     jury     as     follows: 
"You    are    instraeted    that    even    if    you    be- 
lieve    from      the      evidence     that      Russell, 
Pratt    &     Co.   had,    at    or  about     the    time 
the     contract     for    furnishing     gas     fixtiu-es 
for   the    Hendrix    houses    was    entered    into, 


;58G 


REMKDIES  OF  THP:  lU  VKU. 


an  cxi-lusive  agency  for  the  sale  of  the 
ltlaiutift"s  goods  iu  the  dty  of  Omaha;  that 
if  you  fm-thiT  believe  from  the  testimony 
that  they  ((lefeiulants)  introduced  the  plain- 
tiff's salesman  Kyan  to  Messrs.  Balfe  & 
Read,  and  stated  to  Balfe  &  Read  that  any 
agreement  Ryan  made  would  be  satisfactory 
to  them,  and  that  there  was  no  understanding 
on  the  part  of  Balfe  &  Read  at  that  time  that 
they  were  to  procure  the  goods  ordered 
through  Ryan  from  Russell,  Tratt  &  Co.,— 
such  actior.  and  statements  constitute  a 
waiver  on  the  part  of  Russell,  Pratt  &  Co.  of 
their  exclusive  agency,  if  any  existed,  and 
they  are  not  entitled  to  recover  from  the 
plaintiff  any  damages  under  the  first  coiuiter- 
claim  set  up  in  the  answer."  AVe  think  in 
giving  this  instruction  the  learned  judge  er- 
red. It  Avill  be  observed  that  it  stilted  that 
if  Russell  &  Pratt  introduced  Ryan  to  Balfe 
&  Read,  and  stated  to  them  that  any  arrange- 
ment Ryan  made  would  be  satisfactory  to 
Russell  &  Pratt,  and  that  Balfe  &  Read  did 
not  then  understand  that  they  were  to  pro- 
c\ire  the  goods  from  Russell  &  Pratt,  then 
that  these  facts  constituted  a  waiver  by  Rus- 
sell &  Pratt  of  their  exclusive  right.  This 
would  be  a  correct  statement  if  this  were  a 
proceeding  against  Balfe  &  Read.  If  Balfe 
&  Read  did  not  understand  that  their  pur- 
chase was  to  be  from  Russell  &  Pratt,  and  if 
Russell  &  Pratt  informed  them  that  any  ar- 
rangement they  made  with  Ryan  would  be 
satisfactoiy,  and  Balfe  &  Read  had  acted  up- 
on that  statement.  Russell  &  Pratt  would  be 
estopped  as  against  them  from  claiming  any- 
thing to  the  contrary;  but  this  case  does  not 
affect  Balfe  &  Read  at  all.  and  such  an  estop- 
pel would  not  operate  in  favor  of  the  Horn 
('omi)any.  If  the  understanding  was,  as 
Russell  it  Pratt  clainKxl.  that  Ryan  should 
make  the  estimate  to  Balfe  &  Read  on  be- 
half of  Russell  &  Pratt,  then  it  was  imma- 
terial what  Balfe  &  Read  understood,  and 
there  would  in  such  case  be  no  waiver.  The 
statement  claimed  to  have  lieen  made  by  Rus- 
sell to  Balfe  iK:  Read,  that  Russell  &"  Pratt 
would  be  satisfied  with  any  arrangement  that 
Ryan  made,  is  susceptible  of  two  construc- 
tions, according  as  the  otiier  evidence  in  the 
case  may  be  viewetl.  It  might  mean  that 
Russell  &  Pratt  were  willing  to  allow  Ryan 
to  sell  directly  for  the  Horn  Company,  or  it 
might  mean  merely  that  Russell  &  Pratt  au- 
tliorized  Ryan  to  make  any  arrangements  he 
saw  tit  for  them,  and  that  Russell  &  Pratt 
would  supply  the  goods  according  to  any  con- 
tract as  to  prices  or  terms  which  Ryan  might 
make.  It  was  for  the  jury,  in  this  case,  to 
determine  the  nature  of  the  transaction,  and 
decide  this  question.  This  instruction  left 
it  to  be  determined  by  Balfe  &  Read's  judg- 
ment, or  more  accurately  l)y  the  jury's  deter- 
nnnation  of  what  Balfe  &  Read's  understand- 
ing of  what  Ryan's  authority  might  be. 

It  must  not  beunderstood  from  the  foregoing 
discussion  that  the  com-t  is  committing  itself 
to    Russell    &   Pratt's    contcMifjon    that    their 


measuic  of  damages  on  account  of  this  trans- 
action would  be  the  discount  from  the  list 
price  to  which  Russell  tfc  Pratt  were  entitled. 
There  is  some  evidence  tending  to  sIkjw  that 
Russell  &  Pratt  were  under  obligations  to 
sell  at  the  list  prices,  but  their  me-asure  of 
damages  would  be  the  amount  of  protit 
which  they  would  have  made  had  the  sale 
been  through  them.  It  was  clearly  not  con- 
templated that  this  sale  should  be  at  list 
prices;  otherwise  there  was  no  occasion  for 
calling  into  activity  the  discretionary  au- 
thority of  Ryan  to  make  an  estimate.  There 
can  be  no  doubt  that  Ryan  was  authorized  to 
fix  the  price  at  which  the  goods  were  to  be 
sold  to  Balfe  &  Read,  and,  if  the  facts  in  re- 
lation to  this  counterclaim  should  be  deter- 
mined in  favor  of  Russell  &  Pratt,  the  meas- 
ure of  damages  would  be  the  difference  be- 
tween the  price  at  which,  under  their  eon- 
tract,  Russell  &  Pratt  were  entitled  to  buy 
the  goods  from  the  Horn  Company,  and  the 
price  at  which  Ryan  agretil  to  sell  them  to 
Balfe  &  Read.  We  think  the  court  correctly 
refused  an  instniction  asked  by  Russell  & 
Pratt  stating  a  different  rule. 

Complaint  is  made  of  the  eighth  instruc- 
tion given  by  the  com-t  at  the  request  of  the 
Horn  Company.  It  is  as  follows:  "You  are 
instriicted  that,  before  the  defendants  are 
entitled  to  recover  any  damages  under  their 
second  counterclaim,  they  must  first  prove 
that  the  plaintiff  has  sold  its  goods  within  the 
defendants'  territory  between  the  dates  of 
March  1,  1889,  and  March  1,  1890;  and  the 
amount  which  the  defendants  would  be  en- 
titled to  recover  would  be  the  profit  Avhich 
the  plaintiff  made  by  selling  to  outside  deal- 
ers over  what  it  would  have  realized  had  it 
sold  to  Russell,  Pratt  &  Co.,  unless  you  fur- 
ther find  that  the  defendants  have  suffered 
actual  peciunary  loss  by  reason  of  the  plain- 
tiff so  selling  its  goods;  and,  if  you  find  the 
defendants  have  suffered  siich  loss,  then  the 
measure  of  damages  is  such  an  amount  as 
the  defendants  have  proven  by  a  clear  pre- 
ponderance of  the  evidence  they  lost  in 
profits  on  the  sale  of  plaintiff's  goods,  wliicli 
they  can  show  Avith  reasonable  certainty  they 
would  have  made  had  the  plaintiff  not  sold 
any  of  its  goods  within  the  defendants'  teiTJ- 
toiy."  We  do  not  think  that  Russell  &  Pratt 
were  prejudiced  by  this  instruction.  We 
agree  with  them  that  where  one  person  has. 
by  contract,  the  exclusive  right  to  buy  from 
another  and  resell,  within  a  certain  territory, 
goods  in  which  such  other  person  enjoys  a 
monopoly,  and  such  other  person,  in  viola- 
tion of  his  contract,  sells  such  goods  to  other 
persons  within  the  territory,  the  moasm-e  of 
damages  is  the  profit  is'hich  such  first  per- 
son may  with  reasonable  certainty  show  that 
he  would  have  realized  if  the  contract  had 
been  pcM-formed  by  the  other  party.  Mueller 
V.  Spi'ing  Co.  (Mich.)  .",0  N.  W.  319;  Hale  v. 
Hess.  »)  Neb.  42,  4(>  X.  W.  261.  The  ditli- 
culty  in  such  case  is  always  to  establish  with 
legal  certainty   the  amount  of  such  profits 


REMEDIES  OF  THE  BIVEK. 


;587 


but,  if  proper  proof  bo  made,  the  law  permits 
siu-li  recovery.  Mininj.'  Co.  v.  Humble,  14 
Sup.  Ct.  81G.  The  instruetiou  quotcHl  states 
this  rule  to  the  jm-y,  and  tlie  fact  that  it  also 
states  that  Kussell  &.  Pratt  uiiyht  recover 
wliatever  the  Horn  Couipany  realized  by 
sellinj;  the  jjoods  to  otliers  over  and  above 
wliat  it  Avould  have  realized  by  selling  to 
Kussell  &  rratt  does  not  pre.judice  them.  It 
was  an  extension,  and  not  a  restriction,  of 
the  rule  of  damages. 

Upon  the  subject  of  Kussell  &  I'ratt's  meas- 
ure of  damages  upon  the  third  counterclaim, 
the  following  instruction  was  given,  at  the 
Horn  Company's  retpiest:  "You  are  in- 
structed that,  under  their  third  counterclaim, 
the  defendants  are  only  entitled  to  recover 
as  damages  tlie  difference^  between  the  agi'eed 
price  of  the  goods  pm-cliased  of  the  plaintiff 
and  their  market  value  at  the  time  the  plain- 
tiff refused  to  deliver  tliem.  and  the  defend- 
ants must  prove  that  market  value,  which 
would  be  the  amount  Russell,  Pratt  «&  Com- 
pany and  other  like  dealers  would 
have  to  pay  the  plaintiff  for  such  goods 
at  the  time  of  tlie  refusal  to  ship  them." 
The  measure  of  damages  upon  this  coun- 
terclaim would  be  the  difference  between 
the  price  at  wliich  the  Horn  Company 
had  agreed   to  sell   the  goods   to   Russell   & 


Pratt  and  the  market  value  of  sucli  goods 
at  tlie  time  and  place  when  and  where  they 
shoiUd  have  been  delivered.  There  was  evi- 
dence tending  to  estal)lish  both  of  these 
facts.  Tlie  failure  in  this  instruction  to  state 
the  place  wlu-re  the  market  price  was  to  be 
fixed  was  probably  cured  by  another  in- 
struction, but  the  deliiiition  given  of  '•mar- 
ket value"  in  this  instruction  was  <>rroni'()Us. 
Tliere  was  evidence  tending  to  sliow  that  such 
fixtures  as  those  ordered  were  purchasalile 
in  Omaha,  at  the  time  of  the  alleged  Ijreadi 
of  contract,  at  a  di.scount  of  20  per  cent, 
from  the  list  price.  Tliis  instiiiction  prac- 
ticall.v  excluded  such  evidence  from  consid- 
eration. The  market  value  at  Omalia  was 
the  price  at  which  the  goods  were  ol)taiiiable 
there,  without  regard  to  the  person  from 
wliom  they  were  to  be  obtained.  It  was  not 
the  amount  that  Russell  &  Pratt  or  any  one 
else  would  have  to  pay  to  the  plaintiff,  and 
the  jury  sliuuld  not  have  been  restricted  to 
a  consideration  of  the  plaintift"s  prices. 

There  were  many  other  assignments  of  er- 
ror, but,  upon  consideration,  we  find  that  in 
respect  to  tliem  the  action  of  the  trial  coiu-t 
was  substantially  correct,  and  the  conclu- 
sions reached  upon  the  instructions  referred 
to  render  a  further  discus.sion  of  the  record 
unnecessary.     Reversed  and  remanded. 


588 


RE]MEDIES  OF  THE  BCYER. 


KKOWXELL  et  al.  v.  CHAPMAN. 
(.",1  N.  \y.  24!»,  84  Iowa,  504.) 
Suprciiu'   Conit  of   Iowa.      Feb.  2,  1892. 
Appeal     from     .superior     court   of    Council 
Klufts;  J.  K.  F.  :McCoe.  Judge. 

Action  on  a  contract,  in  substance  as  fol- 
lows: "April  12th,  1889.  D.  Cluipuian,  Esq., 
Council  Bluffs,  Iowa— Dear  Sir:  We  will 
furnish  you  one  of  our  Scotch  marine  boil- 
ers, -A  \lia.,  84  long,  made  of  «0,000  T.  S. 
marine  steel  shells,  o-KJ;  *  *  *  all  th^ 
above  delivered  and  set  up,  (you  to  do  all 
wood-work.)- -for  the  sum  of  ten  hundred 
and  twenty-three  dollars,  ($1.02:{.()(».)  We 
will  allow  you  three  hundred  and  sixty  dol- 
lars (.i^iiCi ».()())  for  your  two  engines,  boiler, 
heater,  and  inspirater,  wheels,  shafting,  and 
couplings.  Hoping  to  receive  your  order,  we 
■  are,  yours  truly.  Brownell  &  Co.  P.  S.  We 
guaranty  to  deliver  above  in  thirty  days  from 
April  13th.  It  is  understood  you  are  to  have 
90  days"  option  on  sale  of  engine  and  boiler 
you  have."  "Accepted.  D.  Chapman."  This 
action  is  to  recover  the  balance  of  the  con- 
tract price,  after  deducting  the  .$3no  for  the 
defendant's  engines,  etc.  There  was  a  fail- 
ure to  deliver  the  boilers,  etc.,  on  the  part 
(f  the  plaintiffs  for  som.e  18  days  after  the 
time  specified  in  the  contract;  and  the  de- 
fendant presents  a  counter-claim  because  of 
tlie  failure  and  for  defective  workmanship 
in  putting  in  the  boilers.  A  reply  put  in  is- 
;-.ue  certain  allegations  of  the  counter-claim, 
and  a  trial  by  jury,  resulting  in  a  verdict 
and  judgment  for  the  defendant  for  $31.25. 
The  plaintiffs  appeal. 

Isaac  Adams,  for  appellants.  D.  B.  Daily, 
Kuiniet  Finley.  and  Ambrose  Burke,  for  ap- 
pellee. 

GKANCER.  J.  1.  Lake  Manana  is  a 
small  lake  in  the  vicinity  of  Council  Bluffs, 
in  Pottawattamie  count j%  and  is  a  summer 
:'.nd  ])leasui*e  resort.  Boats  are  used  on 
the  lake  for  the  accommodation  of  visitoi-s, 
and  among  them  was  one  known  as  the  "M. 
V.  liohrer,"  belonging  to  the  defendant.  The 
boat  was  o])erated  on  the  lake  in  the  season 
if  1888,  and  the  boilers  and  machinery  con- 
tracted for,  as  known  to  the  parties,  were  to 
refit  the  boat  for  use  in  the  season  of  1889. 
.\  breach  of  the  contract  on  the  part  of 
l)laintift'  by  a  failure  to  deliver  within  the 
time  is  not  questioned,  and  the  imixntant 
(piestion  on  this  appeal  is  as  to  the  proper 
measure  of  damage.  The  superior  court  ad- 
mitted evidence  to  show,  and  instructed  the 
jury  on  the  theory,  that  the  measure  of  dam- 
age was  the  rental  value  of  the  boat  during 
the  time  the  defendant  was  deprived  of  its 
use  in  consequence  of  the  breach.  The  ap- 
pellants' thought  is  that  the  measure  of  dam- 
age is  the  "interest  of  the  capital  invested  in 
the  boat."  This  latt»>r  rule  has  something 
of  support  in  authority,  but  it  is  far  out- 
weighed by  the  number  of  cases  and  the  rea- 


soning supporting  the  rale  adopted  by  tlis 
court.  In  considering  the  question  we  must 
keep  in  view  the  rule,  universally  recog- 
nized, that  the  damage  for  breach  of  con- 
tract must  be  limited  to  such  as  would  nat- 
urally come  within  the  contemplation  of  the 
parties  at  the  time  tlie  contract  was  made. 
The  plaintiff,  when  it  agreed  to  furnish  and 
set  tiie  boilers,  knew  they  were  to  be  used 
in  operating  the  boat;  that  a  breach  on  its 
part  would  deprive  the  plaintiff"  of  its  use; 
and  it  Avould  naturally  contemplate  the  value 
of  such  use  as  the  injury  that  would  be  sus- 
tained; and  such  is,  as  a  matter  of  fact,  the 
actual  damage.  The  appellants  cite  a  num- 
ber of  cases,  but  all  except  two,  we  think, 
support  the  rale  adopted  by  the  court. 
Brown  v.  Foster,  51  Pa.  St.  1G5,  is  a  case 
quite  similar  to  this.  Repairs  to  a  boat  by 
putting  in  machinery  were  to  be  completed 
by  October  1st.  The  work  was  not  done  un- 
til December  15th.  The  trial  court  gave,  as 
the  rule  of  damage,  "that  the  measure  in 
such  a  case  is  the  ordinary  hire  of  such  a 
boat  for  the  time  in  question,  for  the  time 
plaintiff"  was  in  default."'  The  complaint  in 
that  case  of  the  rule  as  given  was  by  the  de- 
fendant, who  was  seeking  damage,  and  the 
court  .said  his  complaint  was  without  reason. 
Tlie  case  cited  is  not  autliority  for  tlie  ap- 
pellants" position.  In  Mining  Syndicate  v. 
Eraser,  130  U.  S.  (ill,  9  Sup.  Ct.  665,  the  in- 
terest on  the  investment  in  a  mill  that  had 
been  delayed  because  of  defective  machinery 
was  allowed  as  the  measure  of  damage,  but' 
only  in  case  the  jury  found  there  was  no 
evidence  of  the  rental  value  of  the  mill.  The 
case  clearly  recognizes  the  rule  as  to  rental 
value  as  a  correct  one.  In  Grittin  v.  Colver, 
16  N.  Y.  489,  is  the  followiiig  syllabus,  hav- 
ing full  support  in  the  oi^inion:  "Upon  a 
breach  of  a  contract  to  deliver  at  a  certain 
day  a  steam-engine  built  and  purchased  for 
the  purpose  of  driving  a  planing-mill  and 
other  definite  machinery,  the  ordinary  rent 
or  hire  which  could  have  been  obtained  for 
the  use  of  the  machinery  whose  operation 
was  suspended  for  want  of  the  steam-engine 
may  be  regarded  as  damages."  In  Nye  v. 
Alcohol  Works,  51  Iowa,  129,  50  N.  W.  988. 
this  general  principle  has  support  argunien- 
tatively,  but  another  rule,  because  of  distin- 
guishing facts,  is  sustained.  The  cases  of 
Allis  V.  McLean,  48  Mich.  428,  12  N.  W.  040, 
and  Taylor  v.  ]\Iaguire,  12  Mo.  313,  are  not 
in  harmony  with  this  view,  but  they  are 
clearly  overborne  by  the  weight  of  the  other 
cases  and  the  current  of  authority.  Tlie  lat- 
ter case  cites,  as  decisive  of  the  point, 
Blanchard  v.  Ely,  21  Wend.  :U2.  In  Griffin 
V.  Colver,  supra,  the  Blanchard  Case  is  com- 
mented upon  and  explained,  and.  in  effect, 
it  is  divested  of  the  authority  claimed  for  it 
in  the  Missouri  case. 

But  it  is  said  that  tlie  boat  in  question  had 
no  established  rental  value.  By  this  it  is 
meant  that  the  boat  had  never  been  rented. 
But  it  will  not  do  to  say  that  because  an  ar- 


REMEDIES  OF  THE  BUYER. 


389 


tide  li;is  never  been  rented  it  has  no  rental 
valve,  any  more  than  it  would  to  say  that 
because  an  article  had  never  been  sold  it 
has  no  market  value.  We  should  assume 
that  an  ai-ticle  suitable  and  adapted  for  use 
at  a  time  and  idace  has  lK)th  a  market  and 
rental  value,  at  least  until  the  contrary  ap- 
pears. In  Jemmison  v.  Gray.  29  Iowa,  oST, 
this  court  approved  au  instruction  that  "the 
fact,  if  proven,  that  12.213  ties  could  not 
have  been  purchased  for  immediate  delivery 
in  the  market  at  the  places  where  said  ties 
were  to  be  delivered  on  the  1st  day  of  Oc- 
tober, l.%9,  would  not,  of  itself,  establish 
the  fact  that  there  was  not  a  market  price 
for  such  ties  at  such  time  and  place."  The 
holding  affords  a  strong;  presumption  in  favor 
of  a  market  price.  A  like  presumption 
would  preA'ail  in  favor  of  an  article  having  a 
value  for  hire  at  a  time  and  place  where  such 
articles  are  in  demand  for  use.  The  testi- 
mony shows  that  boats  varying  in  size  were 
rented  on  the  lake  during  the  season,  both 
by  the  day  and  for  trips.  This  boat  had  per- 
haps twice  the  carrying  capacity  of  any  other 
boat  on  the  lake,  and  in  that  respect  formed 
au  exception;  but  the  rental  value  of  boats 
depended  on  their  size  and  adaptation  for 
use.  and  it  was  competent  for  persons  hav- 
ing knowledge  of  the  business  and  prices 
paid  for  other  boats  to  give  an  opinion  as  to' 
the  rental  value  of  such  a  boat  as  the  one  in 
question.  It  is  contended  that  the  method 
of  ascertaining  the  rental  value  involves  the 
uncertainties  and  facts  on  which  profits  are 
excluded  as  a  I'ule  of  damage:  but  we  think 
not.  It  is  true  that  rental  values  are  general- 
ly fixed  fi"om  a  calculation  of  the  profits  to 
be  derived  from  the  use,  but  the  rental  is  a 
fixed,  definite  value,  agreed  to  be  paid,  and 
the  bailee  assumes  the  uncertainties  as  to 
the  profits. 

The  appellants  say:  "For  an  analogous 
case  to  the  one  at  bar,  in  there  being  an  at- 
tempt to  prove  a  rental  value  to  property 
wlien  the  facts  showed  that  the  property  in 
(luestion  had  no  rental  value,  the  court  is 
referred  to  Coal  Co.  v.  Foster,  59  Pa.  St.  3(r>." 
The  case,  as  we  we  read  it.  is  without  a 
bearing  on  the  question.  The  defendant 
agreed  to  furnish  for  the  coal  company  an 
engine  of  a  particular  size  and  make.  There 
was  no  other  engine  of  the  kind  that  the 
company  could  use.  There  was  a  delay  in 
the  delivery,  and  the  compan.v  was  compell- 
ed to  transport  its  coal  by  horse-power,  as  it 
had  before  done.  The  trial  court  gave  the 
rule  "that  the  measure  of  damage  for  the  de- 
lay was  the  ordinary  hire  of  a  locomotive 
during  the  period  of  delay."  The  reviewing 
court  gave  the  rule  as  the  difference  between 
the  cost  of  transporting  the  coal  by  hoi'se  an<l 
by  locomotive  power,  but  placed  its  ruling 
on  the  fact  that  the  parties  knew  there  was 
no  other  engine  to  be  operated  on  the  track 
of  the  company,  and  could  not  have  had  such 


damage  in  view  in  making  the  contract.  It 
will  be  seen  that  the  cases  are  different.  If 
in  the  case  at  Imr  the  defendant's  Ixjat  had 
been  operated  at  an  additional  cost  by  do- 
ing the  same  amount  of  work  during  the 
delay,  it  would  be  reasonal)le  to  say  the  dam- 
age to  him  was  the  difference  in  the  cost. 
But  his  is  an  entire  loss  of  use,  and  the  value 
of  such  use  is  the  damage,  where  it  is  pioxi 
mate,  and  not  speculative  or  uncertain. 

2.  A  part  of  the  counter-claim  is  for  loss 
of  time  by  men  kept  in  readiness  by  defend- 
ant to  do  the  part  of  the  work  belonging  to 
him  in  adjusting  the  Iwiilers  and  macliinery, 
as  provided  by  the  contract.  (Jn  this  branch 
of  the  case  the  court  gave  the  following  in- 
struction: "(."))  If  you  find  from  the  evi- 
dence, and  under  the  third  and  fourth  in- 
structions, that  there  was  a  contract,  as  set 
out,  between  plaintiffs  and  defendant,  and 
that  plaintiffs  were  in  default  in  carrjing 
out  said  contract;  and  if  you  find  that,  bj 
reason  of  such  default,  defendant  was  dam- 
aged; and  if  you  further  find  that  defendant 
was  in  readiness  to  carry  out  his  part  of 
said  contract  at  the  time  specified  therein; 
and  that  at  the  time  he  was  in  readiness  to 
run  and  operate  his  boat;  and  that  the  boat 
was  necessarily  idle  during  the  peri(;d  of 
plaintiffs'  default,  by  reason  of  such  default, 
—then  the  defendant  would  be  ent.tled  to 
recover  the  ordinary  and  reasonalile  rental 
value  of  said  lx)at  during  the  time  of  said 
default,  and  such  reasonable  and  necessarj* 
amount  (if  there  be  any  such  amount)  as  he 
may  have  been  required  to  pay  to  any  men 
that  he  may  have  employed  dunng  said  en- 
forced idleness  for  the  purpose  of  rimniug 
said  boat,  if  he  had  any  such  men  in  his 
employ  who  remained  in  his  employ  and  idle 
by  x'eason  of  such  default;  and  if  you  find 
that  the  defendant  had  placed  himself  in 
readiness  to  work  upon  said  boat  himself 
at  the  time  specified  in  the  conti-act  for  the 
furnishing  of  said  machineiy.  and  that  he 
necessanly  remained  idle  during  the  time  of 
such  default,  if  any,  of  the  plaintiffs,  and 
used  ordinary  diligence  to  find  other  employ- 
ment for  that  time,  you  will  then  further 
find  the  fair  and  reasonable  value  of  his 
services  during  the  period  of  such  default 
as  part  of  the  damage,  if  any.  which  defend- 
ant sustained."  Complaint  is  made  of  the 
instruction,  as  stating  an  erroneous  ride  of 
damages,  but  we  discover  no  error.  If,  be- 
cause of  the  breach,  the  defendant  lost  his 
or  the  time  of  his  employes,  for  such  time 
and  exjiense  he  should  be  reimbursed.  The 
rule  is  recognized  in  Mining  Syndicate  v. 
Fraser.  sujira.  The  instruction  fairly  pro- 
tects the  rights  of  the  plaintiffs.  A  number 
of  other  questions  are  argued,  all  of  which 
we  have  examined,  and  find  no  prejudicial 
error.  It  would  serve  no  good  purpose  to 
extend  the  opinion  to  present  them.  The 
judgment  is  affirmed. 


390 


REMEDIES  OF  THE  Bl'YER. 


THILBROOK  v.  EATON. 
(134  Mass.  398.) 

Supreme  Judicial   Court   of   Massachusotts. 
Suffolk.    March  2,   1883. 

Tort,  by  the  administrator  of  the  estate  of 
.Tohn  I),  riillbrook,  for  the  oonverslon  of  cer- 
tain household  furniture.  AMswei',  a  general 
denial.  Trial  in  the  superior  court  without  a 
jury,  before  Wilkinson,  J.,  who  allowed  a  bill 
of  exceptions  in  substance  as  follows: 

The  plaintiff,  as  administrator,  made  a  de- 
mand upon  the  defendant  for  said  furniture 
before  bringing  this  action,  but  the  defendant 
did  not  deliver  it,  having  previously,  in  July, 
1S7!>.  sold  it  to  one  Saw.ver.  The  defendant 
was  allowed  to  put  in  evidence,  subject  to  the 
l)laiiuiff's  exception,  that  he  borrowed  of  the 
lilaiutift's  intestate  $2r)(),  and  gave  as  security 
therefor  a  mortgage  of  a  parcel  of  real  estate 
in  Beverly,  and.  as  additional  security,  a  bill 
of  sale  cf  said  fu"niture.  dated  January  17. 
1874,  in  which  a  consideration  was  expi'essed 
to  be  !f2.j0,  the  receipt  of  which  was  acknowl- 
edged; that  no  money  was  paid  except  the 
sum  of  $250  30  lent;  that  the  intestate  never 
took  possession  of  said  furniture,  but  it  had 
always  remained  in  the  possession  of  the  de- 
fendant until  he  sold  it  to  Sawj'er.  as  above 
stated.  The  bill  of  sale  was  not  reeoi-ded. 
There  was  no  evidence  of  value  o:?;cept  the 
bill  of  sale,  and  the  fact  of  the  sale  of  the  fur- 
niture to  Sawyer. 

The  defendant  asked  the  judge  to  rule  as 
follows:  "(1)  If  the  instrument  relied  on  was 
a  bill  of  sale,  it  Avas  without  consideration, 
and  no  title  passed  to  the  vendee.  (2)  The 
goods  named  in  the  bill  of  sale  were  pledged, 
and.  the  goods  never  having  been  in  posses- 
sion of  the  pledgee,  no  title  passed,  and  this 
action  cannot  be  maintained.  (3)  An  admin- 
istrator is  not  a  party  so  .'s  to  come  within 
Gen.  St.  c.  151.  §  2.  (4)  The  amount  recovei"- 
able  in  an  action  for  conversion  is  the  valtie  of 
the  goods  at  the  time  they  were  converted. 
Xo  value  having  been  proved,  and  the  exist- 
ence of  the  goods  not  having  been  proven, 
nothing  can  be  recovered  in  this  action.  (5) 
This  action  cannot  be  maintained  against  the 
defendant,  as  at  the  time  of  the  alleged  con- 
version he  had  not  possession,  nor  any  con- 
trol over  or  interest  in  the  goods." 

The  judge  declined  so  to  rule,  but  ruled  that, 
as  between  the  original  parties,  the  action 
could  be  maintained  whether  the  goods  were 
mortgaged,  pledged  or  sold,  and  that,  on  the 
evidence  of  the  consideration  of  the  amount 
named  in  the  bill  of  sale,  and  the  nature  of 
the  goods,  he  found  the  damages  to  be  $75. 
The  defendant  alleged  exceptions. 

J.  F.  Wiggin  and  B.  M.  Fernald,  for  plain- 
tiff. C.  C.  Barton  and  A.  D.  McClellan,  for 
defendant. 

COLBrux.  J.  The  written  instrument  un- 
der which  the  i)laintiff  claims  is  a  formal  bill 
of  sale,  not  a  bill  of  parcels,  and  on  its  face 


purports  to  be  the  evidence  of  an  absolute  sale 
of  the  i)roperty  therein  described  by  the  de- 
fendant to  the  plaintiff's  intestate  in  consid- 
eration of  .$250,  which  the  defendant  acknowl- 
edges that  he  received. 

The  plaintiff,  who  by  operation  of  law  rep- 
resents the  personal  property  and  riglits  of  his 
intestate,  sustains  the  same  relation  to  the 
defendant,  and  to  the  propei'ty  in  controversy, 
that  his  intestate  sustained  before  his  decease. 
No  (luestion  as  to  the  right  of  creditors  or  pur- 
chasers without  notice  is  raised. 

As  between  the  plaintiff  and  defendant,  no 
delivery  of  the  property  Mas  necessary  to 
pass  the  title.  Parsons  v.  Dickinson,  11  Pick. 
352;    Packard  v.  AVood.  4  Gray.  307. 

The  plaintiff",  upon  proof  of  the  exectitiou  of 
the  bill  of  sale,  and  payment  of  the  consid- 
eration, which  was  suttic-iently  proved,  prima 
facie,  by  the  acknowledgment  of  the  defendant 
in  the  l)ill.  and  proof  of  a  sale  of  the  same 
property  by  the  defendant  to  Sawyer,  in  July, 
1879.  the  l)ill  of  sale  being  dated  January  17, 
1874,  was  prima  facie  entitled  to  recover  of 
the  defendant  the  value  of  the  property  at  the 
time  of  the  sale  to  Sawyer. 

To  control  the  plaintiff's  ca.se,  the  defend- 
ant was  allowed,  under  exception  of  the  plain- 
tiff, to  introduce  parol  evidence,  which  he 
claimed  tended  to  show  that  the  transaction 
was  not  a  sale,  but  a  mortgage,  or  pledge,  and 
was  witliout  consider  ition.  We  are  of  opin- 
ion that  this  evidence,  so  far  as  it  was  admit- 
ted for  the  purpose  of  varying,  explaining  or 
controlling  the  bill  of  sale,  was  incomiietent 
in  an  action  at  law,  and  should  have  been 
rejected.  Pennock  v.  ;McCormick.  120  Mass. 
275;  Harper  v.  Ross,  10  Allen,  332. 

Whatever  other  effect  the  e%idence  intro- 
duced by  the  defendant  might,  if  competent, 
have  had  upon  the  bill  of  sale,  it  failed  to 
show  any  want  of  consideration.  It  tended 
to  show  that  the  bill  of  sale  was  given  as  part 
of  the  security  for  a  loan  of  $250  from  the 
plaintiff" s  intestate  to  the  defendant,  which 
was  a  good  consideration. 

The  defendant's  second  and  third  reqtiests 
for  rulings  relate  to  the  effect  tipon  the  bill 
of  sale  of  the  evidence  he  was  improperly  al- 
lowed to  introduce;  and  Ave  are  of  opinion 
that  he  has  no  ground  of  exception  that  these 
rulings  were  not  made.  Because  he  had  stic- 
ceeded,  tinder  objection,  in  introducing  in- 
comiwtent  evidence,  he  was  not  entitled  to 
except  because  the  court  did  not  give  it  the 
force  he  claimed  for  it. 

The  court  without  doubt  ruled  that  the 
meastire  of  damages  was  the  value  of  the 
jiroperty  at  the  time  of  conversion.  The  sale 
to  Sawyer  constittited  the  conversion,  and  not 
the  refusal  to  deliver  the  property  to  plaintiff' 
upon  a  subseipient  demand.  The  objection  of 
the  defendant  that  the  existence  of  the  goods 
at  th»^  time  of  demand  had  not  been  proved, 
and  that  the  suit  cotild  not  be  maintained,  be- 
cause at  the  tinu  of  the  conversion  (probably 
meaning  demand)  the  defendant  had  no  pos- 


ItEMEDIES  OF  THE  BUYEU. 


391 


session  of  the  goods,  or  coutnjl  over  or  inter- 
est in  them,  does  not  require  notice. 

There  was  evidence  for  the  consideration  of 
the  court,  upon  the  question  of  value,  in  the 
particular  description  of  the  property  and  the 


consideration  recited  in  the  bill  of  sale,  and 
the  fact  that  the  defendant  had  sold  the  prop- 
ertj'.    The  weijilit  of  this  evidence  is  not  for 
us  to  determine. 
Exceptions  overruled. 


392 


REMEDIES  OF  THE  BUYER. 


GOULD  et  al.  v.  STEIN  et  al. 

(22  N.  E.  Rep.  47,  149  Mass.  570.) 

Supreme  Judicial  Court  of  Massachusetts. 
Suffolk.     Sept.  4,  18S9. 

Exceptions  from  superior  court,  Suffolk 
county;  Kouekt  C.  Pixm.\n,  Jud<,'e. 

Action  by  Henry  A.  Gould  and  others 
afiain.st  Abe  Stein  and  others  lor  breach  of 
wairaiity  on  the  sale  of  certain  rubber. 
Judgment  for  plaintiffs.   Defendants  except. 

/.  B.  Warner  and  H.  E.  Warner,  for 
plaintiffs.  /.  H.  Dougherty  and  &.  A.  King, 
for  defendants. 

C.  ALLEN",  J.    The  determination  of  this 
case   de[)end3  npon    the   construction  to  be 
given  to  the  bought  and  sold  notes,  which 
were  similar  in  their  terms.     It  does  not  ad- 
mit of  doubt  tliat  these  notes  were  intended 
to  express  tlie  terms  of  tiie  ^ale.     They  were 
carefully  prepared  and  were  read  to  the  par- 
ties line  by  line,  as  they  were  written.     Of 
course  all  the  existing  circumstances  may  be 
looked  at,  but  the  contract  of  the  parties  is 
to  be  found  in  what  was  thus  written,  when 
re.ad    in   the   light   of  tiiose   circumstances. 
The  goods  respecting  which  the  controversy 
has  arisen  were  a  certain  lot  of  rubber  which 
the  defendants  had  on  liand,  and  which  could 
be  identified.     The  transaction  was  a  present 
sale,  and  not  an  agreement  to  deliver  rubber 
in  the  future.     The  defendants  now  contend 
that  the  contract  was  executory,  and  that,  if 
tiiere  was  any  warranty,  tiiere  was  none  which 
survived  the  acceptance  of  the  goods  by  the 
plaintiffs;  but  thearguuient  tliat  it  was  not  an 
executed  present  sale  finds  no  sup|)ort  in  the 
bill  of  exceptions,  and  nosui-h  point  was  taken 
at  the  trial;  and  there  is  noo  -casion  to  consid- 
er the  further  yuesliou  vvheLher,  in  case  of  an 
executory  agreement  to  sell,  a  warranty  will 
survive  the  acceptance  of  the  goods.     The 
bought  note,  which  the  plaintiffs  put  in  evi- 
dence, was  of  "148  bales  Ceara  scrap  rub- 
ber,   as  per  samples,  viz.,  46  bales  of  fust 
quality   marked  'A;'    102   bales   of   second 
quality."     The   controversy  relates  only  to 
the  102  bnles.     It  appeared  tliat  there  was  no 
exact  standard  by  whicii  the  grade  of  rubber 
could  be  fixed,  but  that  it  was  a  matter  of 
jud.Mnent.     The  court  also  found  that  Ceara 
rubber  of  second  qualily  is   well  known  in 
the  market  as  distinct  from  a  third  or  inferior 
grade;  and  tiiere  was  evidence  which  well 
warranted  tliis  finding.     The  parties  in  their 
contract  recognized  the  existence  of  different 
grades  or  qualities,  though  all  of  the  rubber 
properly  classified  as  of  first  quality  or  of  sec- 
ond quality  might  not  be  of  an  exactly  uni- 
form standard  or  grade. 

The  plaintiffs  at  the  trial  claimed  damages 
merely  on  the  ground  that  the  102  bales 
were  not  of  second  quality,  and  made  no 
claim  of  inferiority  to  the  samples  shown,  as 
a  distinct  ground,  but  waived  all  claim 
founded  on  tiie  exhibition  of  samples,  and 
the  court  found  damai-^es  for  the  ulaintiffs 


solely  on  the  ground  that  the  defendants 
failed  to  deliver  rubber  of  the  second  quality; 
ruling  that  the  broker's  note  contained  an  ab- 
solute warranty  of  second  quality  rubber.  If 
this  ruling  was  right,  it  disposes  of  the  defend- 
ants' second  and  third  re  juests  for  instruc- 
tions. The  general  rule  is  familiar  and  admit- 
ted that  a  sale  of  goods  by  a  particular  descrip- 
tion imj)orts  a  warranty  that  the  goods  are 
of  that  description.  Ilenshaw  v.  Robins,  9 
Mete.  83;  Harrington  v.  Smith,  138  Mass. 
92;  White  v.  Miller,  71  N.  Y.  118;  Osgood 
V.  Lewis,  2  liar.  &  G.  495;  Ramlall  v.  New- 
son,  L.  R.  2  Q.  13.  Div.  102;  Jones  v.  Just, 
L.  R.  3  Q.  13.  197;  Josling  v.  Kingston!,  13 
C.  13.  (X.  S.)  447;  Bowes  v.  Shand,  L.  R.  2 
App.  Gas.  455.  And  where  goods  are  de- 
scribed on  a  sale  as  of  a  certain  quality, 
which  is  well  known  in  the  niaiket  as  indi- 
cating goods  of  a  distinct,  though  not  abso- 
lutely uniform,  grade  or  standard,  the  de- 
scription imports  a  warranty  that  the  goods 
are  of  that  gradeorstandard.  In  such  cases, 
the  words  denoting  the  grade  or  quality  of 
the  goods  are  not  to  be  treated  as  merely 
words  of  general  commendation,  but  they 
are  held  to  be  words  having  a  specific  com- 
mercial signification.  Tims,  in  Hastings  v. 
Lo\'el■i^'^  '  I'ick'  "'' '  t'>"  \vn'->'«.  -'^  •'  -;  I'e- 
note.  "Sold  Mr.  E.  T.  Hastings  2,000  gal- 
lons prime  quality  winter  oil,"  were  held 
to  amount  to  a  warranty  that  the  article 
sold  agreed  with  the  description;  and  in 
Hensliaw  v,  Robins,  9  Mete.  87,  it  was 
said  that  the  doctrine  laid  down  in  that 
case  has  ever  since  been  considered  as  the 
settled  law  in  this  commonwealth.  So  in 
Chisholin  v.  Proudfoot,  15  U.  C.  Q.  B.  203, 
it  was  held  tliat  where  a  manufacturer  of 
fiour  marked  it  as  of  a  paiti 'iilar  qualily, 
viz.,  "Trafalgar  Mills  Extra  Sui>erfine,"  it 
amounted  to  a  warranty  of  its  be.ng  of  such 
a  quality.  A  similar  doctrine  may  be  found 
in  Hogins  >^.  Plympton,  11  Pick.  97;  Winsoi 
V.Lombard,  18  Pick.  57,  00;  Foiclipimer  v. 
Stewart,  65  Iowa,  593,  22  N.  W.  Ri'p.  886; 
Mader  v.  .Jones,  1  X.  S.  Law  R.  82.  In 
Gardner  v.  Lane,  9  Allen,  492,  12  Allen,  39. 
it  appf^ared  that  thest  itutes  provided  for  the 
preparation,  division  into  different  qualities, 
packing,  inspecting,  and  branding  of  mack- 
erel, and  it  was  held  that  if  a  certain  number 
of  barrels  of  Xo.  1  mackerel  were  sold,  and  by 
mistake  barrels  of  Xo.  3  mackerel  were  deliv- 
ered, no  title  passed  to  the  purchaser,  and 
that  the  barrels  of  Xo.  3  mackerel  thus  de- 
livered by  mistake  might  be  attached  asprop- 
erty  of  the  vendor,  and  that  each  different 
quality,  after  being  thus  prepared  for  mar- 
ket, was  to  be  regarded  as  a  different  kind 
of  merchandise,  so  that  no  title  passed  to  the 
vendee;  there  being  no  assent  on  the  part  of 
the  vendee  to  take  the  Xo.  3  mackerel  in 
place  of  those  which  he  agreed  to  buy. 

Xow,  if  the  words  "as  per  samples"  had 
not  been  in  the  bought  note,  it  would  be  quite 
jtlain  that  the  present  case  would  fall  within 
the  ordinary  rules  above  given.  But  the  in- 
sertion  of   those   words   raises   the   inquiry 


REMEDIES  OF  THE  BUYER. 


S9:>' 


wiieLher  they  limit  the  implied  Wiirninty  of 
the  vendor,  so  tb;it  it'  the  rubber  sold   was 
equal  in  quality  t'>  tlie  sample  he  would  be 
exonerated  from  lial)ility,  tiioiiub  it  was  not 
entitled  to  be  classed  as  of  the  second  quality. 
If  no  other  meaning  could  be  given  to  the 
words   "as   per   samples"  except   that   they 
alone  were  to  be  considered  as  showing  tiie 
quality  of  rubber  to  be  delivered,  the  argu- 
ment in  favor  of  the  defendants'  view  would 
be  irresistible.     So  if  there  was  a  plain  and 
necessary  inconsistency  between  the  two  de- 
scriptions of  the  rubber,  it  might  perhaps  be 
succe-sf  uUy  contended  that  the  vendor's  ob- 
ligaliim   was   only  to  deliver  rubber  which 
would   conform   to   the  interior  quality  de- 
scribed; that  is  to  say,  that  in  case  of  sucii 
inconsistency,   the  words   "as  per  samples'' 
should   prevail,   and   the    words  "of  second 
quality"  be  rejected.     If  it  were  to  be  h^^ld 
that  the  vendor's  obligation  was  fullilled  by 
delivering  rubber  of  a  quality  equal  to  tiie 
samples,  though  it   was   not   of   the   second 
quality,  then  tlie  words  "of  second  (juality" 
would  mean  nothing,  or  they  would  be  over- 
borne by  the  words  "as  per  samj)les."     But 
if  it  is  found  that  the  bouglit  note  admits  of 
a  reasonable  construction  by  which  a  proper 
''.i<;ni(icance  can   be  given  both  to  the  words 
"as  per  samples"  and  also  to  the  words  "of 
second  (juality,"  there  will  be  no  occasion  to 
disregard  either.     Cast  s  are  to  be  found  in 
the   books    where   such  a   construction    has 
oeen   given    to   contracts  of  sale.     Thus,  in 
Whitney  v.  Boardman,  118  Mass.  242,  a  sale 
of  Cawnnore  buiTalo   iiides,  witli   all  faults, 
was  held  to  mean  with  such    faults  or  de- 
fects as  the  article  sold  migiit  have,  retaining 
still  its  character  and  identity  as  the  article 
described:  and  the  court  cited  with  approval 
the  case  of  Shepherd  v.  Kain,  5  Barn.  &  Aid. 
240,  where  tiiere  was  a  sale  of  m  cop-ipr-fast- 
ened   vessel,  to   be  taken  "with  all  faults, 
without  allowance  for  any  defects  whatso- 
ever," and  tills  was  held  to  mean  only  all 
faults  which  a  copper-fastened  vessel  might 
have,  the  court  saying  I  v  way  of  illustration: 
"Sui)pose  a  silver  service  sold  with  all  faults. 
and  it  turns  out  to  be  plated."     So,  in  Nichol 
V.  (lodis,  10  Exch.  191,  an  agreement  for  tiie 
sale  and  delivery  of  certain  oil,  described  as 
"foreign    refined    lape   oil,    warranted   only 
equal  to  samples,"  was  held  to  be  not  com- 
plied with  by  the  tender  of  oil  which  was  not 
foreign   refined   rape  oil,  although  it  might 
be  equal  to  the  quality  of  the  samples.     The 
de(  ision  of  this  case  has  stood  in  England, 
though  not  without  sor.iC  questioning  at  the 
bar.     See  Wieler  v.  Schilizzi,  17  C.  B.  619; 
Josling  V.  Kingsford,  13  C  B.  (X.  S.)  447; 
Mody  V.  Gregson,  L.  K.  4  Exch.  49;  .Jones 
V.  Just,  L.  R.  3  Q.  B.  197;  Randall  v.  Xew- 
son,  L.  R.  2  Q.  B.  Div.  102.     In  the  present 
case,  by  a  fair  and  reasonable  construction 
of  the  bought  nijte,  effect  can  be  given  to 
both  of  the  phrases  used  to  describe  tlie  rub- 


ber.    Construed    thus,  the  article  sold   was 
102   bales   of   Ceara   rubber,  of    the  second 
quality,  and  as  good  as  the   samples.     The 
rul)l)er  delivered  was  in  fact  Ceara  rubber. 
There  was   no   question  that  it  was  of  the 
right  kind;  but  it  was   nut   of  the  second 
quality.     Tliere  is  no  necessity  to  disregard 
the    words  describing   tiie  rul)l)er  as  of   tlie 
second    quality.     They   signilied   a   distinct 
and  well-known,  though  not  absolutely  uni- 
form, grade  of  rubber.     There  was  no  exact 
standard  or  dividing  line  between  rubber  of 
the  second  quality  and  of  the  third  quality, 
any  more  than  there  is  between  daylight  and 
darkness.     But  nevertheless  a  decision  may 
be  reached,  and  it  may  lie  easy  to  reach  it  in 
a  particular  case,  that  certain  rubber  is  or  is 
not  of  tlie  second  quality.     This  general  desig- 
nation being  given,  the  specilicalion  "as  per 
samples"  being  also  included  in  the  note,  the 
rubber  must  also  be  equal  to  the  samples.    It 
must  be  rubber  of  the  second  quality,  and  it 
must  be  equal  to  the  samples.     If  it  fails  in 
either  particular,  it  is  of  no  consequence  that 
it  conforms  to  the  othi  '•  particular.     Tliere 
is  no  inconsistency  in   sucli  a  twofold  wai'- 
ranty;  and,  this  rubber  having  been  found 
to  be  not  of  the  second  quality,  the  warranty 
was  broken,  without  legard  to  the  question 
whether  or  not  it  was  etjual  to  the  samples. 
The  fact  that  tlie  plaintilfs  had  an  oppor- 
tunity to  examine  the  rubber,  and  actually 
made  such  examination  as  they  wished,  will 
not  necessarily  do  away  with  the  effect  of  tlie 
warranty.     The  plaintiffs  were  not  bound  to 
exercise  their  skill,  having  a  warranty.    They 
might  well  rely  on  the  description  of  the  rub- 
ber, if  they  were  content  to  accept  rubber 
which  should  conform  to  that   descrijition. 
Ilenshaw   v.  Robins,  9    Mete.   83;  .Jones  v. 
Just,  L.  R.  3  Q.  B.  197.     And  the  exhibition 
of  a  sample  is  of  no  greater  effect  than  the 
givin<r  of  an  opi  ortunity  to  inspect  the  gootis 
in  bulk.     Notwithstanding  the  sample  or  the 
inspection,  it  is  an  implied  term  of  the  con- 
tract tiiat  the  goods  shall  reasonably  answer 
the  description  given,  in  its  commercial  sense. 
Drummond   v.  Van    Ingen,  E.  R.   12   App. 
Cas.  284;  Mody  v.  Greu^son,  L.  R.  4  Exch. 
49:  Xichol  v.  Godts,  10  Exch.  191.     In  the 
two  former  of  these  cases  it  was  held  that 
there  might  be,  and  tiiat  under  the  circum- 
stances then  existing  there  was,  an  implied 
warranty  of   merchantable  quality  notwith- 
standing the  sale  was   by  a  sample,  which 
samjile  was  itself  not  of  merchantable  quali- 
ty, the  defect  not  being  discoverable  upon  a 
reasonable  examination  of  tlie  sam])le. 

The  point  urged  in  the  defendants'  argu- 
ment, that  the  plaintiffs'  remedy  was  de- 
stroyed by  their  acceptance  of  the  goods,  was 
not  taken  at  the  trial,  and  no  ruling  was 
asked  adapted  to  raise  the  ijuestion  as  to  the 
effect  of  such  acceptance.  For  these  reasons, 
in  the  opinion  of  a  majority  of  the  court,  the 
entry  must  be:     Exceptions  overruled. 


394 


RE.MEI>II':S  OF  THE  BUYER. 


FJELDEU    V.    STARKIN. 

(1  H.    1^1.   17.) 

Court  of  Common   Ploas,   Trinity   Term,   17S8. 

This  was  an  actiou  on  the  warranty  of 
n  mare,  "that  she  was  .?..>uiid,  quiet,  aud  free 
from  vice  aud  blemish." 

Plea,  non-assumpsit,  on  which  issue  was 
joined. — 

Tlie  cause  came  on  to  be  tried  at  the  hist 
assizes  at  Thetford,  before  Mr.  Justice  Ash- 
Inust,  and  a  venhct  found  for  the  phuntiff. 
It  :ipi)eared  on  the  trial,  from  the  learned 
judge's  report,  that  the  plaintiff  had  bought 
the  mare  in  question  of  the  defendant  at 
\Vinnel  fair,  in  the  month  of  March,  1787, 
for  :iO  soiineas.  and  that  the  defendant  war- 
ranted her  soimd,  and  free  from  vice  aud 
blemish.— S(X)u  after  the  sale,  the  plaiutiff 
discovered  that  she  was  unsound  and  vicious 
(a),  but  kept  her  three  months  after  this  dis- 
<()very,  during  which  time  he  gave  her  phys- 
ic and  used  other  means  to  cure  her.  At  the 
end  of  the  three  months  he  sold  her,  but  she 
was  soon  returned  to  him  as  unsound.  Aft- 
<n-  she  was  so  returned,  the  plaintilf  kept  her 
till  the  month  of  October  1787,  and  then  sent 
her  back  to  the  defendant  as  unsound,  who 
refused  to  receive  her.  On  her  Avay  back  to 
the  plaintiffs  stable,  the  mare  died,  and  on 
her  being  opened,  it  was  the  opinion  of  the 
farriei's  who  examined  her,  that  she  had  been 
unsound  a  full  twelve-month  before  her 
death.  It  also  appeared  that  the  plaiutilf 
and  defendant  had  been  often  in  company  to- 
getlier  during  the  interval  between  the  month 
of  March,  when  the  mare  was  sold  to  the 
plaintiff,  and  October,  when  he  sent  her  back 
to  the  defendant;  but  it  did  not  appear  that 
the  plaintiff  had  ever  in  that  time  ac(iuaimed 
the  defendant  with  the  circumstances  of  her 
being  unsound.  The  juiy  found  a  verdict  for 
the  plaintiff  with  30  guineas  damages. 

Adair,  Serjt.,  shewed  cause.  Le  Blanc, 
Sei-jt.,  in  support  of  the  rule. 

Lord  LOUGHBOROUGH— Where  there  is 
an  express  warranty,  the  warrantor  under- 
takes that  it  is  true  at  the  time  of  making  it. 
If  a  hoi'se  which  is  warranted  sound  at  the 
time  of  sale,  be  proved  to  have  been  at  that 


time  unsound,  it  is  not  necessary  that  he 
should  be  returned  t<j  tlie  seller.  No  length 
of  time  elapsed  after  the  sale,  will  alter  the 
nature  of  a  contr.-ict  originally  false.  Nei- 
ther is  notice  necessary  to  be  given.  Though 
the  not  giving  notice  will  be  a  strong  pre- 
sumption against  the  buyer,  that  the  horse 
at  the  time  of  the  sale  had  not  the  defect 
complained  of,  aud  will  make  the  proof  on 
his  part  nmch  more  ditticult.  The  bargain 
is  complete,  and  if  it  be  fraudulent  on  the 
part  of  the  seller,  he  will  be  liable  to  the 
buyer  in  damages,  without  either  a  return  or 
notice.  If  on  account  of  a  horse  warranted 
sound,  the  buyer  should  sell  him  again  at  a 
loss,  an  action  might  perhaps  be  maintained 
against  the  original  seller,  to  recover  the  dif- 
ference of  the  price.  In  the  present  case  it 
appears  from  the  evidence  of  the  farriers 
who  saw  the  mare  opened,  that  she  must 
have  been  unsound  at  the  time  of  the  sale  to 
the  plaintiff. 

GOULD,  .7.- Of  the  same  opinion,  remem- 
bered many  cases  of  express  warranty,  where 
a  return  was  not  held  to  be  necessary. 

HEATH,  J. — If  this  had  been  an  action 
for  money  had  aud  receivtxl  to  the  plaintiff's 
use,  an  immediate  retm-n  of  the  mare  would 
have  been  necessary;  but  as  it  is  brought  on 
the  cxpi'css  warranty,  there  was  no  necessity 
for  a  return  to  make  the  defendant  liable. 

AVILSON,  J.— Of  the  same  opinion,  recol- 
lected a  cause  tried  before  Mr.  Justice  BuUer 
at  nisi  prius,  where  the  defendant  had  sold 
the  plaintiff  a  pair  of  coach  horses  and  war- 
ranted them  to  be  six  years  old,  which  were 
in  reality  oidy  four  years  old.  It  was  con- 
tended that  the  plaintiff  ought  to  have  re- 
turned the  horses;  but  Mr.  Justice  BuUer 
held  that  the  action  on  the  warranty  might 
be  supported  without  a  retm-n.  i  As  to  part 
of  the  evidence  being  contrary  to  the  ver- 
dice,  the  jury  have  a  right  to  use  their  dis- 
cretion either  in  believing  or  disbelieving 
any  part  of  the  testimony  of  witnesses. 

Rule  discharged. 

1  S<'<'  Towers  v.  Barrett,  1  Term  R.  p.  136, 
and  Buchanan  t.   Parnshaw,  2  Term    R.   745. 


STATUTE   OF  FRAUDS. 


395 


BAU.MAXX   V.   MANISTEE   SALT  &   LUM- 
BER CO. 

(53  N.  W.  1113,  94  Mitli.  3(53.1 

Supreme  Court  of  Michigan.     Dec.  23,  18U2. 

Error  to  circuit  court,  .Mauistee  coimty; 
J.  Byrou  Judkius,  Judge. 

Action  by  Max  Baiiinaun.  adniiuistratov 
of  the  estate  of  Ann  McCormick,  deceased, 
against  the  Manistee  Salt  &  Lumber  Com- 
pany, insolvent.  Judgment  for  defendant. 
Plaintiflf  appeals.     Affirmed. 

McAlvay  &  Grant,  for  appellant.  Uhl  & 
Crane,  for  appellee. 

GRANT,  J.  Ann  McCormick  filed  a  claim 
against  the  defendant,  which  was  insolvent, 
and  whose  estate  was  in  the  hands  of  re- 
ceivers. The  receivers  contested  the  claim. 
Two  trials  were  had.  Upon  the  first,  Mrs. 
McCormick  was  a  witness  in  her  own  be- 
half. A  new  trial  was  granted,  and  before 
the  second  trial  she  died.  Her  testimony 
was  received  in  evidence  upon  the  second 
trial.  The  claim  is  based  upon  three  prom- 
issory notes  executed  by  M.  Englemann  to 
the  order  of  Mrs.  McCormick,  and  aggre- 
gating $2,700.  The  court  directed  a  ver- 
dict for  the  defendant.  At  the  time  these 
notes  were  given,  Englemann  lived  in  Man- 
istee, and  was  reputed  to  be  a  man  of  great 
wealth.  Upon  the  face  of  the  notes,  there 
is  nothing  to  connect  the  defendant  with 
them.  Englemann  died  before  two  of  the 
notes  became  due,  and  his  estate  proved  to 
be  insolvent.  Mrs.  McCormick  presented 
these  notes  in  the  probate  court  against  his 
estate,  and  they  were  allowed.  Failing  to 
obtain  her  money  against  that  estate,  she 
presented  a  claim  against  the  company. 
Mr.  Euglemaim  was  president  of  the  com- 
pany. It  is  apparent  from  this  record  that 
she  loaned  the  monej'  to  Mr.  Englemann, 
and,  at  the  time  the  loans  were  made, 
.she  did  not  understand  that  she  was  loan- 
ing it  to  the  defendant.  It  is  now  sought  to 
make  the  defendant  liable  on  the  ground 
that  the  money  was  received  by  it,  and 
to  show  this  by  certain  entries  upon  its 
books.  The  money,  in  the  tir.st  instance, 
was  loaned  upon  the  credit  of  Mr.  Engle- 
mann. The  defendant's  liabiliry,  if  any. 
was  therefore  collateral,  and  its  promise 
must  be  evidenced  in  writing,  signed  by 
it.  How.  St.  §  G185;  Ruppe  v.  Peterson,  r,7 
Mich.  437,  3.5  N.  W.  82.  and  authorities  there 
cited.  A  writing  which  is  relied  upon  to 
take  the  promi.se  out  of  the  statute  must 
contain  all  the  terms  of  the  contract.  Such 
promise  cannot  rest  partly  in  parol  and  part- 
ly in  writing.  Hall  v.  Soule,  11  Mich.  494; 
Ayres  v.  Gallup.  44  Mich.  13.  5  N.  W.  1072. 
Under  these  authorities,  the  evidence  of 
Mrs.  McCormick  as  to  conversations  be- 
tween   Mr.    Englemann   and   herself,    or   be- 


tween herself  and  any  other  officer  of  the 
corporation,  for  the  purpose  of  connecting 
the  entries  upon  defendant's  books  with  the 
notes,  was  incompetent.  Her  conversation 
with  Englcm.uin  was  also  incompetent,  un- 
der 3  How.  St.  §  7.">4.j  1  since  he  was  an  offi- 
cer of  the  corporation. 

Mr.  Englemann  was  a  member  of  several 
other  firms,  and  was  al.so  engaged  in  an 
extensive  business  of  his  own.  He  bor- 
rowed money  from  the  defendant  to  a  large 
amount,  and  paid  moneys  to  it  from  time  to 
time.  An  account  of  these  receipts,  and 
payments  by  him.  was  kept  upon  defend- 
ant's books  under  the  head  of  "M.  Engle- 
mann. General. ■■  At  his  death  the  amount 
due  the  company  on  this  account  was  .$80.- 
000.  An  accoimt  was  also  kept  on  the  de- 
fendant's books  under  the  head  of  "M.  En- 
glemann." Upon  this  account  were  enter- 
ed his  family  expenses,  and  similar  per- 
sonal items.  Ml-.  Englemann  also  kept  a 
private  cash  book  and  journal,  upon  which 
were  entered  up  these  notes,  as  those  fof 
which  he  was  personally  liable.  The  entries 
under  the  head  of  "M.  Englemann,  Gener- 
al," which  are  relied  upon  by  the  plaintiff, 
are  as  follows:  "M.  Englemann.  General. 
His  note  to  Mrs.  Ann  McCormick  2-5  one 
year,  7  per  cent.;  taken  up  his  demand  note 
10th,  2nd,  $G(X)  currency  from  her  first;  to- 
tal, ?4(X);  total.  ^fLOOO."  "M.  Englemann. 
General.  Received  from  Mrs.  Ann  McCor- 
mick, against  his  bills  payable,  No.  579 
first  29  six  months.  7  per  cent."  "M.  Engle- 
mann, General.  Bill  payable  799.  7-9,  one 
year  from  date.  Mrs.  McCormick  first. 
$700."  The  items  received  upon  these  notes 
appear  upon  defendant's  cash  account  to 
the  credit  of  Mr.  Englemann.  These  en- 
tries do  not  show  that  Mr.  Englemann  bor- 
rowed this  money  as  the  agent  of  the  de- 
fendant, and  for  its  benefit.  The  natural 
inference  is  that  he  borrowed  on  his  own 
account,  and  placed  it  to  his  credit  on  the 
books  of  defendant,  to  which  he  was  large- 
ly indebted.  The  defendant  was  not,  there- 
fore, an  undisclosed  principal.  As  already 
stated,  parol  evidence  was  incompetent  to 
show  that  the  notes  were  in  fact  the  notes 
of  the  company.  Bank  v.  Filer,  83  Mich. 
490.  47  N.  W.  321;  Insurance  Co.  v.  Covell, 
8  Mete.  (Mass.)  442;  Fuller  v.  Hooper,  3 
Gray,  334;  Jones  v.  Phelps.  5  Mich.  218; 
Kelsey  v.  Chamberlain,  47  Mich.  241.  10  N. 
W.  355;  Fiuan  v.  Babcock.  .58  Mich.  301.  25 
N.  W.  294. 

There  is  nothing  in  the  case  on  which  to 

1  3  How.  St.  §  7545:  "And.  when  any  suit 
or  proceeding  is  prosecuted  or  defended  by  any 
corporation,  the  opposite  party,  if  examined  as 
a  witness  in  liis  own  behalf,  sliall  not  be  admit- 
ted to  testify  at  all  in  relation  to  matters  whicli. 
if  true,  must  liave  been  e(inally  within  the 
knowledge  of  a  deceased  othcer  or  agent  of  the 
corporation,  and  not  within  the  knowledge  of 
any  surviving  officer  or  agent  of  the  corpora- 
tion.'' 


396 


STATUTE  OF  FRAUDS. 


apply  rhe  doctrine  of  estoppel.  The  benefit 
to  the  defendant  was  not  received  direct!  r 
from  Mrs.  McCormick.  but  from  P:uj,'lemann. 
who  had  loaned   the  money  from   her.     By 


the  transaction,  defendant  became  En-'Ie- 
manu's  debtor,  as  to  these  monevs,  and  "be- 
came in  no  sense  her  debtor.  Judgment  af- 
firmed.    The  other  justices  concurred. 


STATUTE  OF  FKAL'DS. 


397 


FRANCIS  V.  BARRY. 

(37  X.  W.  353,  69  Mich.  311.) 

Supreme    Court    of    Michigan.     April    13.    1SS8. 

Appeal  from  circuit  court,  Kalamazoo  coun- 
ty. 

Action  by  Harriet  Francis  against  Charles 
H.  Barry.  Jr..  for  damdires  for  breach  of  con- 
tract to  convey  certain  real  estate.  Judgment 
for  plaintiff  and  defendant  appeals. 

H.  H.  Riley  and  Howard  &  Roos.  for  appel- 
lant.    D.  Boudemau.  for  appellee. 

CHAMPLIN,  J.     This  action  was  brought 
to  recover  damages  for  a  breach  of  contract 
made  by  the  defendant  with  the  plaintiff,  by 
which  he  agreed  to  sell  and  convey  to  her  a 
certain  store  property  situated  in  the  village 
of   Schoolcraft,  in  the  countj'  of  Kalamazoo, 
Mich.,  for  the  con.«ideration  of  ,$-J,5(Xt.— $2,000 
to  be  paid  down  in  cash,  and  the  balance  by 
her  note  of  $50(J.  to  be  paid  by  the  rent  of 
the  store  as  it  accrued,  at  the  rate  at  which  it 
was  being  rented,  to-wit,  $400  per  year,  and 
which  was  payable  in  monthly  installments. 
The  declaration  sets  up  that  the  contract  is  in 
writing,    and   consists    of   letters    written    be- 
tween the  parties  on  and  prior  to  July  1.  1SS6; 
that  the  defendant  claimed  to  be  the  owner  of 
The  real  estate  described  in  the  first  count  of 
the  declaration  as  "a  strip  of  land  twenty-six 
feet  wide,  oft  of  the  north  side  of  the  north- 
west quarter  of  lot  No.  one  hundred  and  thir- 
ty-two (132.)  and  also  the  north-east  quarter 
of  the  same  lot,  excepting  a  strip  twenty-two 
1 22)  feet  wide  on  the  south  side  of  the  last- 
named  parcel,  according  to  the  recorded  plat 
of  the  village  of  Schoolcraft,  always  reserv- 
ing from  the  north  side  of  both  parcels  an  un- 
divided one-half  of  the  wall,  and  the  laud  on 
Avhich  it  stands,"  and  generally  knowu  as  the 
"Schoolcraft  store,"  and  the  "Schoolcraft-store 
property."     The  declaration  also  alleges  that, 
at  the  request  of  defendant,  the  completion  of 
said  agreement  by  the  parties  was  extended 
until,   to-wit,    September   15,    1880,    when   de- 
fendant ascertained  he  had  no  title  to  the  prop- 
erty,  but  that  thi    same  was   in   Charles    H. 
Barry,  Sr..  father  of  defendant;    and  defend- 
ant stated  that  he  would  procure  a  deed  from 
his   father,  to  hs  made  to   plaintiff,   of  said 
propertj'.  within  a  reasonable  time  after  said 
15th  day  of  September    and  requested  plain- 
tiff to  allow  him  a  reasonable  rune  (o  procure 
such   deed    which   plaintiff*   consented   to   do. 
Plaintiff  avers  that  at  all  times  from  said  July 
1,    1SS6,    until    NoA  ember    IS,    1886,    she    was 
ready  to  accept  from  defendant  a  deed  of  the 
said  premises,  and  pay  defendant  the  amount 
which  she  had  agreea  to  pay  him,  as  aforesaid, 
and   so   notified   defendant  at   several   times; 
and  within  a  reasonable  time  after  said  15th 
day  of  September.  1886,  she  so  notified  the  de- 
fendant, and  offered  to  carry  out  her  contract 
with  him,  and  requested  him  to  carry  out  said 
contract  with  her.  and  convey,  or  cause  to  be 
conveyed,   to  her  said  property;    that  defend- 
ant did  not  nor   would,    within  a  reasonable 
time  aftei   July  1,  1886,  nor  within  a  reason- 


able time  after  September  15,  ISSO,  can-y  out 
his  said  contract,  or  convey,  or  procure  to  be 
conveyed,  to  plaintiff'  the  said  premises;    but, 
before  said  reasonable  time  had  elapsed,  said 
defendant  sold   the  premises  to  one  WiUiam 
Roberts,  and   procured  a  deed  thereof  to  be 
made  to  him  by  said  Charles  H.  Barry,  Sr., 
for  a  consideration  of  .'?3,0(JO;    and  by  reason 
thereof  said  defendant  placed   it  beyond  his 
power  to  carry  out  liLs  contract  with  pliiiutift', 
wnd  by  that  act  excused  plaintiff"  from  mak- 
ing any  formal  tender  of  the  purchase  money 
to  him,  although  plaintiff  was  ready  and  will- 
ing, and  offered,  to  paj  the  same  to  defendant 
as  soon  as  he  would  have  made  to  her  such  a 
conveyance  as  he  agreed  to  make.     The  law 
appears  to  be  well  settled  that  a  complete  and 
binding  contract  may  be  created  by  letters,  or 
other  writings,  relating  to  one  connected  trans- 
action, if.  without  the  aid  of  parol  testimony, 
the  parties,  the  subject-matter,  and  the  terms 
of   the   contract   may   be   collected.     Allen   v. 
Bennett,  3  Taunt.   169;    Jackson  v.   Lowe,   1 
Eing.  9;    Dobell  v.  Hutchinson,  3  Adol.  &  E. 
355;    Jones  v    Williams,  7  Mees.  &  W.  493; 
Telegraph    Co.    v.    Railroad   Co.,   86  111.    240; 
Moore  v.  Mouutcastle,  61  :Mo.  424;   Abbott  v. 
Shepard.   48  N.   H.    14.     The  plaintiff   recov- 
ered-judgment in  the  court  below,  and  defend- 
ant brings  the  case  into  this  court  by  Avrit  of 
error,  and  insists  that  the  judgment  ought  to 
be  reversed  for   the   following   reasons:    "(1) 
Because  the  plaintiff  failed  to  show  a  suffi- 
cient description  of  the  property"    (2)  because 
she  failed  to  show  a  sufficient  contract,  in  writ- 
ing,  to  take   the   case  out  of   the   statute  of 
frauds,  and  for  the  reason  that  the  minds  of 
the  parties   nevei    met   in   coutract  relations; 
(3)  because,  all  the  evidence  there  was  in  the 
case  bearing  on  the  contract  beuag  undisputed, 
the  court  erred  in  submitting  it  to  the  jury  to 
determine  whether  or  not  there  was  a  contract; 
there    was    nothing    in    the    case    to    submit 
to  a  jury:    (4)  there  was  error  in  the  admis- 
sion of  other  evidence  to  which  we  will  spe- 
cifically call  the  attention  of  the  court."     The 
correspondence  is  too  lengthy  to  warrant  us 
in  setting  it  forth  in  detail.     It  consisted  of 
letters    written    to   and    from    the   defendant. 
Those  written  tc  defendant  were,  for  the  most 
part,   written  by  plaintiff's  husband,  and,  as 
she  testifies,  at  her  request;    and  the  replies 
to  such  letters  were  addressed  to  him  by  the 
defendant.     As  no  question  is  made  as  to  his 
authority  to  so  act  for  plaintiff,  but  the  cor- 
respondence conducted  by  him  has  been  treat- 
ed   througliout   as   hers   by  both   parties,    we 
shall  so  regard  it.     Notice  was  given  to  the 
defendant   to  produce  the  letters   written  by 
and  on  behalf  of  the  plaintiff  upon  the  trial 
of  the  cause,  and.  upon  being  requested  so  to 
do  upon  the  trial,  defendant's  counsel  replied: 
■"We  have  some  of  them,  and  some  of  them 
have  been   destroyed."     No  explanation   was 
given  of  the  reason  why,  or  the  circumstances 
under    which,    they    were    destroyed,    or    by 
whom.     No  great  lapse  of  time  occurred  dur- 
ing wliich  they  might  become  lost  as  deemed 
unimportant.     The    correspondence    closed    In 


398 


S'l'ATUTE  OF  FRAUDS. 


tho  fall  of  ISSr..  ami  this  suit  was  coimneueed 
soon  after,  and  was  tried  in  June,  1SS7.  He 
was  apprised  by  a  letter  from  her  of  date  Oc- 
tober 8,  ISSli,  to  which  he  replied  under  the 
same  date,  that  she  Avas  advised  that  his  let- 
ter made  out  a  contract  of  sale,  and  lience  he 
would  se«>  the  'mportance  of  preserving  the 
correspondence  so  far  as  it  was  in  liis  hands, 
especially  if  it  failed  to  show  what  was  the 
sid).iect-niatt'>r  of  the  sale.  The  plaintiff  was 
under  tlie  necessity  of  resorting  to  secondary 
evidence  of  that  portion  of  tlie  contract.  And 
if  there  should  be  any  discrepancy  between 
the  parties  in  their  testimony  regarding  the 
contents  of  such  letters  as  he  received,  and 
failed  to  produce,  the  presumption,  from  the 
fact  of  his  having  destroyed  testimony  in  his 
liands,  would  be  against  liis  assertion,  and  in 
favor  of  hers,  which  the  jmy  would  be  en- 
titled to  consider  when  weighing  their  testi- 
mony. The  correspondence  starts  with  a  let- 
ter written  by  the  plaiutift"  to  defendant,  ask- 
ing him  if  he  would  sell  that  Schoolciaft  store 
for  .$;3,0(H».  and  take  .?1,0()0  in  goods;  to  which 
he  replied,  under  date  of  December  22,  1S84: 
"1  will  sell  the  property  for  .?:J,000,  but  I 
can't  take  goods.  We  have  a  big  stock,  and 
are  trying  to  reduce  it,  but  it  is  slow  business. 
Can  you  tell  me  any  one  who  will  let  me  have 
.i;2,(X)0  on  the  pioperty.  I  would  like  to  raise 
that  amount.  Please  let  me  know,  and 
oblige."  She  afterwards  wrote  offering  him 
.$2.5(X)  for  the  store —$2,(X)0  in  money,  and 
.$500  in  notes,  and  ai)ply  the  rent  on  the  notes. 
He  replied  August  26,  1885.  saying  that  he 
could  not  sell  that  property  for  less  than  $3,- 
000,  and  that  it  seemed  to  him  that  she  would 
do  well  to  buy  it  at  that  price,  and  offering  to 
take  .$2,.">00,  and  her  note  for  the  other  .$.jOO, 
and  count  the  rent  against  it  of  the  lease, 
which  would  pay  more  than  half  of  it.  Plain- 
tiff again  wrote  him,  offering  him  !i!2,000  in 
money,  and  her  note  for  .i^.jOO.  and  let  the  rent 
apply  on  the  note;  to  which  he  replied  Sep- 
tember 7  or  9,  1885,  as  follows:  "I  will  sell 
you  that  property  for  what  you  offer,  if  you 
give  me  the  rent  until  April  1st.  I  want  to 
sell  it.  I  have  no  time  to  attend  to  it,  or  look 
after  it.  It's  cheap,  I  am  sure,  and  tliought 
I  never  would  sell  for  that;  but  I  think  it's 
best  to  let  it  go,  if  I  can  get  that  fur  it."  To 
this  plaintiff  replied,  October  8,  1885:  "Will 
say  to  you  that  I  will  take  the  property  us 
soon  as  I  can  raise  the  money.  Think  I  can 
in  a  few  weeks  I  talked  with  Mr.  Hoyt  y(  s- 
terday.  He  told  me  he  thought  he  could  raise 
the  money  for  me."  No  contract  seems  to 
have  been  consummated  between  the  parties 
up  to  this  time.  The  ne.\t  containing  auy- 
tliing  is  a  part  of  a  letter  produced  by  plain- 
tiff, which  is  dated  November  10,  1885,  and 
contains  a  part  ot  a  sentence  written  Ijy  de- 
fendant: "T  hope  you  will  take  the  property 
and  *  *  *"  The  balance  of  the  letter  plain- 
tiff testifies  is  lost.  The  matter  continued  thus 
until  March  1.  1880,  when  defendant  wrote: 
•'I  expected  to  hear  from  you  before  this  time, 
or  see  you.  Do  you  think  you  will  take  the 
property?     Please  let  me  know,  and  oblige." 


To  this  plaintiff  '-eplied  that  she  would  raise- 
the  money  as  soon  as  possible,  by  the  fore 
part  of  April,  she  thought.  He  waited  until 
May  10,  1880,  when  he  wrote  again:  "Is  it 
expected  that  you  will  take  the  property  soonV 
I  nuist  sell  it,  or  raise  some  money  on  it, 
soon.  If  you  cannot  raise  the  whole  I  will 
take  $2.(K)0,  and  rent  for  the  rest."  Plaintiff 
does  not  testify  that  she  made  any  response 
to  this  letter;  and  May  14,  1880,  defendant 
writes  plaintiffs  husband:  "I  supposed  imiil 
yesterday  that  the  store  at  Schoolcraft  was 
rented,  when  Mr.  Kobbius  sent  word  to  know 
if  I  would  sell  it  to  him."  He  tells  him  that 
he  is  going  homt  the  next  Monday  to  be  gone 
two  or  three  weeks;  that  he  had  sent  word  to 
Mr.  Robbins  that  he  would  sell,  or  that  he 
could  talk  to  Mr.  Fi.incis  about  it;  that  he 
told  him  he  thought  the  property  could  be 
bought  for  about  .$.3,(XK)  and  payment  down. 
The  plaintiff  replied  to  this  that  the  store  was 
already  rented  to  good,  responsilile  parties,  and 
that  she  thought  it  was  better  tliat  it  should 
remain  as  it  was;  that  she  wrote  him  that 
she  would  have  the  money  in  a  few  days.  On 
the  17th  of  May,  1880,  defendant  wrote  to  D. 
H.  Francis:  "Yoiu-  letter  received,  and  all 
satisfactory.  *  *  *  So  it  is  all  right,  and. 
when  you  can  raise  the  money,  I  will  take  it. 
I  shall  be  gone  about  two  weeks.  Let  all 
stand  as  it  is  until  I  get  back.  Raynerstowu 
is  my  address."  Up  to  this  time  it  will  be 
seen  that  no  bargain  had  been  concluded. 
While  the  terms  had  been  agreed  upon,  still 
it  was  held  in  abeyance,  and  depending  upon 
plaintiff's  raising  the  $2,(X)0  to  be  paid  down. 
She  was  not  in  a  position  to  perforin,  or  ask 
performance.  Plaintiff  made  her  arrauge- 
meuts  to  raise  the  money  by  a  loan  upon  the 
property  from  a  Mr.  Seaman,  who  residL'd  in 
New  York,  through  Judge  Stearns  of  Kalama- 
zoo, and  the  money  arrived  for  that  purpose 
in  Kalamazoo  on  the  18th  of  ^May,  1880. 
Plaintiff  thereupon  wrote  defendant  before  lie 
left  for  New  York,  notifying  him  that  tlie 
money  was  ready.  He  replied  from  Rayners- 
towu, N.  Y.,  May  21,  1886:  "Yours  just  re- 
ceived, and  I  am  glad  to  hear  of  your  suc- 
cess in  raising  the  money.  I  need  it  veiy 
much.  I  shall  be  back  the  last  of  next  week, 
or  tlie  fore  part  of  the  one  following,  and  will 
let  you  know  when  I  get  there."  Plaintiff 
then  wrote  hiir  that  the  money  was  here,  and 
she  would  like  to  have  a  deed,  and  have  the 
papers  delivered,  and  returned  liack.  He  re- 
plied as  follows: 

"Raynerstowu,  New  Y'ork,  July  1.  1S8(>. 

"Friend  Francis:  Your  letter  received, — 
came  to-day.  In  anawer  will  say  I  will  give 
you  a  deed  of  this  date.  July  1,  1S8(5,  and  take 
the  rent  up  to  that  date,  take  $2,0(M),  and  the 
notes  for  tbe  balance  aad  Avill  attend  to  it 
just  as  soon  as  I  get  back,  if  satisfactory. 

"Yours,  etc.  C.  H.  Barry." 

No  written  response  was  made  to  this  let- 
ter, but  the  plaintiff  let  the  matter  rest,  as 
requested  by  defendant.  She  arranged  to 
hold  the  money  so  as  to  be  able  to  carry  out 
the  contract  on  her  part.     He  did  not  return 


STATl'lK    <»F    KKACDS. 


39& 


to  Mi(ln;iaii  as  soou  as  lie  liad  I'Xpectecl. 
I'laiutift'  wrote  him  that  the  uiouey  was  ly- 
iii;:  useless,  ami  she  regretted  it,  aud  defend- 
ant wrote  her,  under  date  of  Aiifru-st  17,  1SS(>; 
"1  regret  it  all  as  much  as  anylK)dy,  for  i 
have  been  paying  S  per  cent,  for  the  money, 
and  need  more  at  the  hank  all  the  time.  Hut 
1  could  not  get  back  sooner.  Will  be  tln're 
sure  by  Monday  or  Tuesday,  and  perhaiis 
Saturday.  Will  let  you  know."  She  wrote  him 
again  to  know  when  he  was  coming  up,  aud 
at  what  time  he  thought  he  would  be  here  to 
arrange  the  matter;  to  AA-hich  he  replied,  Au- 
gust 28,  1SS(J:  "Your  letter  came  last  night, 
aud  I  intended  to  go  up  on  the  morning  train, 
but  missed  it.  I  have  looked  everywhere  for 
the  deed  you  gave  me,  but  cannot  tind  it.  but 
can  get  the  description  there.  Please  have 
the  papers  made  out,  aud  then  we  can  lix 
the  business  up  quick.  *  *  *  i  win  not  be 
up  until  Monday  morning  on  the  early  train, 
and  must  go  back  on  the  noon."  Plaintilf.  in 
accordance  with  this  request,  procured  Mr. 
Stearns  to  prepare  the  papers,  and  had  the 
deed  and  papers  all  prepared,  aud  Mr.  Barry 
came  to  Kalamazoo  on  the  Monday,  as  he  had 
appointed.  On  his  arrival  he  ascertained  that 
there  was  an  undischarged  mortgage  upon 
the  premises,  and  either  at  that  time,  or  a 
few  days  later,  he  ascertained  that  the  rec- 
ord did  not  show  him  to  be  the  owner  of  the 
premises,  but  that  the  title  of  record  was  in 
his  father.  He  insisted  that  he  supposed  that 
he  Avas  the  owner,  and  stated  that  he  m.ust 
have  a  deed  at  home  that  had  not  been  re- 
corded, but  he  undertook  to  rectify  the  title. 
He  did  get  the  mortgage  discharged  of  record, 
aud  directed  his  father  to  make  a  deed  to  de- 
fendant; but,  on  receiving  offer  of  .l^o.OOO 
from  another  party,  he  directed  his  father 
not  to  execute  the  deed  to  defendant,  but  to 
the  other  party.  He  received  .'j^l.-jOO  of  the 
purchase  money  from  the  purchaser,  and 
took  a  mortgage  for  the  balance  running  to 
him  (the  defendant.) 

We  are  of  opinion  that  a  complete  ami  bind- 
ing contract  is  plainly  deducible  from  the  let- 
ters, aud  that  they  contain  all  the  essential 
terms  requisite  to  comply  with  the  statute 
(section  6181,  How.  St.)  It  appears  that  the 
minds  of  both  parties  met  upon  the  same 
terms.  The  offer  embraced  in  the  letter  of 
July  1,  188(5,  so  far  as  it  contained  new  propo- 
sitions, appears  to  have  been  unconditioually 
accepted  and  acted  upon  by  the  plaintiff,  al- 
though there  does  not  appear  to  have  been 
any  express  acceptance  in  writing.  The 
notes  and  manner  of  payment  are  made  suf- 
ticientl.v  certain,  by  implication,  bj'  reference 
to  the  preceding  letters.  No  parol  testimony 
is  necessary  to  be  resorted  to  in  order  to  sup- 
l)ly  the  essential  terms  of  the  contract.  Con- 
cisely stated,  the  correspondence  shows  an 
offer  by  defendant  to  sell  and  convey  to  the 
plaintiff  the  property  known  as  the  "School- 
craft-store  property,"  for  !p2..j()().— .^2,0U0  in 
cash  ou  delivery  of  deed,  aud  two  notes 
amounting  to  .I^.jUO,  to  be  sigued  by  plaintiff. 


ami  pa.vablc  froui  the  rents  of  the  property 
.sold,  the  rent  accrued  to  April  1st.  the  date 
which  the  deed  was  to  bear,  to  be  applied  ou 
the  notes;  and  the  acceptance  of  this  offer  by 
plaintilf  is  proved.  This  conclusion  disposer 
of  the  second  point  raised  by  counsel  for  de- 
fendant. 

Upon  the  first  point  raised,  the  writing  con- 
tains a  sutKcient  descrijitiou  t(j  iilentify  the 
proi)erty.  The  plaintiff  had  formerly  owned 
the  property,  and  had  conveyed  it  to  defend- 
ant's father,  and  defendant  supposed  that  it 
had  been  conveyed  to  him,  and  plaintiff  knew 
nothing  to  the  contrary.  I'laimifl's  husl)and. 
appears  to  have  acted  for  defendant  in  rent- 
ing the  property,  cijllecting  the  rent,  ;ind  re- 
mitting it  to  defendant.  And  the  description 
contained  in  the  first  correspondence  as  "the 
Schoolcraft  store,"  and  referred  to  by  defend- 
ant in  the  same  way.  in  his  letter  of  May  14, 
ISSG,  is  a  sufficient  designation  to  convey  the 
property  in  a  deed,  aud  so  described  would 
convey  the  parcel  of  land,  upon  which  the 
store  stood,  known,  used,  and  occupied  there- 
with. After  having  designated  it  in  the  cor- 
respondence as  "the  Schoolcraft  store,"  the 
subsequent  correspondence  conveyed  a  def- 
inite meaning  when  it  referred  to  it  as  "the 
property."  Both  parties  understood  what 
property  was  meant,  and  so  Avould  a  stranger 
to  the  parties,  and  to  the  property,  fully  com- 
prehend that  the  term  "property"  referred  to 
and  meant  the  SchoolCTaft-store  property. 

The  third  point  must  be  overruled.  We 
hold,  as  a  legal  conclusion  from  the  undis- 
puted facts,  there  w&s  a  contract  as  alleged, 
and  the  court  should  so  have  charged  the 
jiu-y.  But,  the  .iury  having  found  a  verdict 
for  the  plaintiff',  the  defendant  was  not  preju- 
diced by  the  error  of  the  court.  The  fifth 
point  is  overruled.  The  sixth  point  refers  to 
the  ruling  of  the  court  upon  the  admission  of 
testimon.v.  There  are  19  errors  assigned  upon 
rulings  of  this  kind.  Two  of  them  relate  to 
testimony  Avhich  the  court  admitted  relative 
to  the  item  of  !>;()()  interest  which  plaintiff' 
paid  for  the  use  of  the  money  she  had  ar- 
ranged for,  and  which  was  held  for  her 
awaiting  defendant's  action,  and  the  items 
of  expense  which  plaintiff'  incurred  in  repairs 
upon  the  store  while  she  was  in  possession, 
and  in  the  expectation  of  obtaining  the  legal 
title,  in  accordance  with  her  contract.  The 
error,  if  any  was  committed,  in  admitting 
this  testimony,  (which  we  do  not  decide.)  was 
corrected  by  the  court  in  his  charge  to  the 
jury.  He  instructed  them  that  plaintiff  could 
not  recover  for  the.se  iteius.  and  the  amount 
of  the  verdict  which  the  jury  returned,  shows 
that  they  obeyed  the  instruction  of  the  court 
in  that  respect.  The  other  errors  assigned 
upon  the  admission  of  testimony  are  over- 
ruled; and,  perceiving  no  error  whatever  in 
the  errors  assigned  upon  the  record,  the  judg- 
ment is  affirmed. 

SHERWOOD,  C.  J.,  and  MORSE  and 
LONG,  JJ.,  concurred. 


400 


STATUTE  OF  FRAUDS. 


AUSTRIAN  &  CO.   v.  SPRINGER. 

(54  N.  W.  50,  94  Mich.  343.) 

Supreme  Court  of  Michifran.      Dec.  23.  1S92. 

Error  to  circuit  court.  Kent  coimty;  Allen 
C.  Ad.sit.  Judfie. 

Action  by  Leo  An.strian  &  Co.  against 
Nathan  Springer  for  failure  to  deliver  goods 
contracted  to  be  sold  by  defendant  to  plain- 
tiff.s.  There  was  a  verdict  in  plaintiffs"  favor, 
and  defendant  biings  error.    Affirmed. 

The  contract  was  entered  into,  on  defend- 
ant's l)eh:ilf,  by  Frank  O.  P'itton,  a  soliciting 
agent  employed  by  defendant.  At  the  trial, 
plaintiffs  introduced  evidence  of  a  custom  all 
over  the  country  for  such  agents  to  accept 
orders  without  conference  with  their  prin- 
cipals. The  deposition  of  one  Lisen,  defend- 
ant's manufacturing  agent,  was  also  intro- 
duced in  evidence.  On  cross-examination  of 
this  witness,  plaintiffs  sotight  to  show  that 
his  order  had  not  been  tilled  because  defend- 
ant had  entered  into  a  combmation  or  as- 
sociation with  other  manufacturers  not  to  sell 
goods  to  American  houses  for  a  certain  time. 
On  the  subject  of  Fitton's  authority  to  bind 
defendant,  the  court  charged  as  follows: 
"When  one  employs  another  as  his  agent  to 
sell  goods  or  other  property,  and  knows,  as 
a  matter  of  fact,  that  he,  in  so  acting,  as- 
smues  to  make  contracts  with  his  customers 
absolutely  binfling  on  his  principal,  leaving 
no  option  on  his  part  to  repudiate  or  reject, 
leaving  the  agent  clotheji  with  apparent  au- 
thoi'ity  to  make  such  contract,  in  the  absence 
of  any  proof  of  limitation  or  restriction  upon 
liis  authority,  the  presumption  mtist  prevail 
that  the  agent  is  acting  within  the  scope  of 
his  authority,  and  the  principal  is  bound  by 
his  acts.  So  that  if  you  believe  in  this  case, 
from  the  evidence,  that  the  defendant  had, 
prior  to  March  21,  1890,  employed  Fitton  as 
his  agent  to  sell  German  looking-glass  plates 
in  Chicago  and  elsewhere  in  the  United 
States,  and  had  clothed  him  with  apparent 
authority  to  make  contracts  for  the  sale  of 
such  goods,  and  the  plaintiffs  had  knowledge 
that  he  was  so  acting,  then,  in  the  absence  of 
any  proof  of  limitation  or  restriction  on  his 
authority,  he  must  be  presumed  to  have  been 
a  general  agent  of  the  defendant,  clothed 
with  power  to  accomplish  tlie  purpose  of  his 
agency,  to  wit,  make  contracts  for  the  sale  of 
goods,  binding  alike  on  tlie  ptirchaser  and  the 
seller."  "If  you  shall  find  that  the  defend- 
ant did  clothe  him  with  the  apparent  author- 
ity of  a  g<meral  agent  for  the  purpose  of 
making  sales  of  his  goods,  he  is  bound  by 
his  acts,  within  the  general  scope  of  his 
authority,  even  though  they  may  have  been 
in  vi<jlation  of  his  instructions,  if  tht?  plain- 
tiffs had  no  notice  of  his  instructions."  "The 
presumption  is  that  one  knowTi  to  be  a  general 
agent  is  acting  within  the  scope  of  his  author- 
ity, and  a  partj'  dealing  with  him  is  not 
bound  to  make  inquiry  concerning  such  au- 
thorit5C    While  there  is  no   proof  of  actual, 


express  authority  given  by  (h^f^'udant  to  Fit- 
ton  to  accept  orders  for  glass,  yet  the  jui-y 
have  the  right  to  infer  such  authority,  and 
such  express  authoritj'.  from  the  evidence 
in  the  case,  if,  to  the  minds  of  the  jury,  the 
evidence  convinces  them  that  such  authority 
was  given."  "The  evidence  of  defendant's 
knowledge  may  be  derived  from  the  acts  of 
the  parties,  proved  to  have  taken  place  be- 
tween them,  relating  to  the  business  of  the 
agency,  if  such  acts  convince  you  that  such 
authoiity  was  given  or  was  not  given."  "The 
question  is  not,  what  avus  the  authority  ac- 
tuall.v  given"?  but,  what  was  the  party  dealing 
with  the  agent  jtistified  in  believing  the  author- 
ity to  be"?"  "If  yoti  find  that  the  defendant 
pur.  his  price  list  of  these  goods  in  the  nands 
of  Fitton  for  the  purpose  of  enabling  him  to 
sell  them,  that  would  amount  to  an  implied 
authority  to  liim  to  sell  them,  no  notice  of 
the  contrary  being  shown  or  appearing;  and, 
unless  he  did  sell  them  in  other  than  the  usual 
manner,  the  plaintiffs  were  not  under  ob- 
ligation to  inquire  as  to  the  agent's  authority. 
If  he  did  sell  them  in  an  unusual  manner — or 
offered  to — to  the  plaintiffs,  that  fact  should 
have  put  them  on  inquiry,  and  thereby  to 
have  obtained  knowledge  of  the  limited  agen- 
cy of  Fitton,  if  in  fact  his  authority  was 
Umited."  "In  order  to  hold  the  defendant 
liable,  under  the  facts  of  this  case,  for  the 
acceptiince  by  Fitton  of  the  order  given-  by 
the  plaintiffs,  if  made  in  good  faith  and  the 
exercise  of  reasonable  care  on  the  part  of 
plaintiffs,  it  is  not  necessary  that  the  plam- 
tiffs  establish  a  custom  on  the  part  of  the 
sohciting  agents  to  accept  orders."  "Unless 
you  find  that  such  custom  prevailed  generally, 
was  certain  and  reasonable,  you  camiot  find 
that  Fitton's  authority  to  bind  the  defendant 
was  enlarged  by  any  usage  of  this  particidar 
trade  or  local  custom  prevailing  at  Chicago 
or  elsewhere,  unless  you  find  that  defendant 
had  knowledge  of  such  local  custom,  and.  in 
order  to  show  defendant's  knowledge  of  such 
custom,  it  is  not  necessary  to  produce  tUrect 
proof  on  the  stibject.  The  jury  have  the 
right,  if  they  thuik  the  evidence  warrants  it. 
to  infer  such  knowledge  from  the  defendant's 
relations  to  and  knowledge  of  the  trade,  and 
from  aU  the  evidence  in  the  case." 

John  T.  Miller  and  Taggart,  Wolcott  & 
Ganson,  for  appellant.  Stuart  &  Isriappen, 
for  appellees. 

McGRATli.  C.  J.  Plaintiffs  are  manufac- 
tur«-i's  of  furniture,  at  Chicago,  111.,  and  de- 
fendant is  a  manufacturer  of  glass  at  Fuerth, 
Bavaria.  On  the  21st  of  March,  1890,  one 
Frank  O.  Fitton  caUed  at  plaintiffs'  office, 
gave  to  plaintiffs'  manager  a  card  as  agent 
of  defendant;  "said  he  came  to  sell  me  Ger- 
man looking-glass  plates  for  importation;  that 
he  was  selling  for  defendant,— and  quoted 
prices;"  and  after  some  negotiations  plain- 
tiffs signed  a  written  order  drawn  up  by 
Fitton,  which  is  as  follows:    "Ll-'Ctter  liead- 


STATUTE  OF   FRAUDS. 


401 


iiig  of  Leo  Austrian  ^:  Co.]  Cliicat^;),  March 
21,  1890.  Natbau  Springer,  Fuertli,  Bavaria 
—Dear  Sir:  Please  enter  our  order  for  fol- 
lowing German  looking-glass  plates;  same  to 
be  shipped  as  soon  as  possible,— not  later 
tlian  May  15th,— and  f.  o.  b.  Chicago;  freight 
to  be  prepaid  to  New  Yorlv,  and  duty  and 
freight  from  New  York  to  be  paid  by  con- 
signee, and  deducted  from  invoice.  [List 
given.]  Terms  and  discount:  GO— 10 — 2%  on 
plain;  60—10—5—21/2  on  beveled.  The  size 
101/^  by  17,  beveled,  being  quoted  at  net  371/2 
cents,  f.  o.  b.  Chicago.  Net  IK)  and  'JO  days. 
I.,eo  Austrian  &  Co."  Fitton  drew  up,  signed, 
and  delivered  to  plaintiffs,  the  following: 
••[Letter  head  of  Leo  Austrian  &  Co.]  Chi- 
cago, March  21,  1S90.  Ordered  from  Nathan 
Springer,  Fuerth.  Bavaria,  following  German 
mirrors,  to  be  shipped  soon  as  possible, — ^not 
later  than  May  15.  Terms,  f.  o.  b.  Chicago. 
.\et  60  and  90  days.  [List  of  glass,  prices, 
terms,  and  discounts,  same  as  in  order  signed 
by  plaintiffs.]  Frank  O.  Fitton,  Agent." 
I'Mtton  said  he  would  accept  the  order.  The 
iliseounts  were  from  Ust  prices.  Plaintiffs  had 
a  price  list,  on  which  Fitton  gave  the  dis- 
counts. The  defendant  did  not  deliver  the 
goods.  About  INIay  1,  1890,  plaintiffs  received 
from  defendant  the  f  oho  wing  letter:  •'[Letter 
head  of  N.  Springer.]  Fuerth,  Bavaria,  April 
15,  1890.  Mess.  Leo  Austrian  &  Co.,  Chi- 
cago, 111. — Gentlemen:  Your  valued  order 
March  21st,  duly  to  hand,  and  regret  not  to 
be  able  to  execute  it  in  the  time  specified. 
Hoping  to  hear  from  you  later,  I  remain,  truly 
yours,  N.  Springer."  Leo  Austrian  says:  "'Upon 
receipt  of  that  letter,  I  wrote  to  defendant.  I 
suppose  my  letter  Avas  sent  out  of  the  olHce 
as  all  the  mail  is.  The  letter  copy  book  was 
accidentally  destroyed.  Up  to  the  1st  day  of 
.Inly,  I  expected  that  the  order  would  be 
Idled.  On  June  28,  1890,  I  placed  an  order  in 
New  York.  They  would  give  me  no  price 
at  tlie  time,  but  the  order  was  placed  sub- 
ject to  July  prices."  This  suit  is  brought 
to  recover  the  difference  between  the  prices 
named  in  the  order  given  to  Fitton  and  the 
prices  paid.  Plaintiffs  recovered,  and  de- 
fendant   appeals. 

The  first  question  raised  is  that  the  evi- 
dence fails  to  show  a  contract  between  the 
parties:  (1)  The  order  signed  by  plaintilfs 
and  the  paper  signed  by  Fitton  do  not 
( onstitute  a  contract;  and  (2)  it  does  not 
appear  in  evidence  that  Fitton  had  author- 
ity to  make  a  binding  contract.  These 
two  propositions  practically  resolve  tliem- 
selves  into  one;  for,  if  Fitton  had  author- 
ity to  bind  defendant,  the  procurement 
and  receipt  of  the  order  was  sufficient,  in 
itself,  to  create  a  contract.  Kessler  v.  Smith, 
(Mimi.)  44  N.  W.  Rep.  794.  In  that  case  the 
order  was  solicited  at  St.  Paul,  Minn.,  by 
one  of  the  firm,  and  was  addressed  to  the 
firm  at  New  York.  In  Heffron  v.  Armsby, 
61  Mich.  505,  28  N.  W.  Rep.  072,  a  memoran- 
dum of  sale  was  signed  by  the  purcliaser 
only,   and  delivered  to   the   soliciting  agent. 

VANZILE  SEL.CAS.S.\LES— 26 


It  was  held  that,  if  the  agent  was  authorized 
to  act  for  the  vendor,  the  memorandum  wns 
sufficient  to  satisfy  the  statute  of  frauds, 
In  addition  to  the  receipt  of  the  order  by  the 
agent,  the  agent  executed  an  acknowledg- 
ment, •'Ordered  from  Nathan  Springer,"  etc., 
and  signed  it.  "I-'rank  O.  Fitton,  Agent." 
Thi.-i  cannot  be  treated  as  a  mere  receipt 
for  an  order,  nor  is  it  an  acknowledgment  of 
a  request  to  enter  an  order,  but  rather  an 
acknowledgment  of  the  entry  of  the  ordtr 
signed  by  Fitton  as  agent  for  his  principal. 

As  to  the  authority  of  the  agent,  there  is 
no  evidence  of  any  limitation  upon  his  pow- 
ers. It  appears  that  he  was  the  agent  of  de- 
fendant. He  was  in  defendant's  employ,  and 
sent  out  for  the  express  puri)ose  of  taking  or- 
ders for  glass.  He  was  a  resident  of  the 
United  States,  and  was  employed  by  letter. 
He  held  himself  out  as  an  agent,  and  that  to 
defendant's  knowledge.  In  his  correspond- 
ence with  his  principal,  he  wrote  upon  a  let- 
ter head  in  which  his  name  appeared  as 
"manufacturer's  agent."  The  only  question 
that  can  be  raised  under  this  record  is  as  to 
the  extent  of  his  authority.  Parties  dealing 
with  an  agent  have  a  right  to  presume  that 
his  agency  is  general,  and  not  limited.  Me- 
thueu  Co.  V.  Hayes,  33  Me.  169;  Trainer  v. 
Morrison,  78  Me.  HiO,  3  Atl.  Rep.  18.").  And 
the  presumption  is  that  one  known  to  be  an 
agent  is  acting  within  the  scope  of  his  au- 
thority. Inglish  V.  Ayer,  79  Mich.  516,  44  N. 
W.  Rep.  942.  Plaintiffs  went  further.  Evi- 
dence of  persons  who  had  dealt  with  de- 
fendant through  this  ag:'nt  was  introduced 
to  show  the  character  of  his  agency.  This 
was  competent.  Heft'ron  v.  Arm.sby,  supra; 
Haughton  v.  :Maurer,  55  Mich.  323,  21  N.  W. 
Rep.  426;  GaUinger  v.  Traffic  Co.,  67  Wis. 
529,  30  N.  W.  Rep.  790.  One  Selkin  testified 
that  he  had  known  defendant  since  .lanuavy, 
1889;  that  for  three  years  the  firm  of  which 
he  was  a  member  had  been  buying  glass 
from  defendant, — a  part  of  that  time  through 
Fitton;  that  orders  had  been  given  by  liis 
firm,  through  Fitton,  in  July,  1SS9.  Septem- 
ber, 1889,  and  February,  1890.    In  December, 

1889,  witness  received  an  invoice  from  de- 
fendant of  the  September  order,  on  the  head- 
ing of  which  was  printed  the  words,  '"Agi-nts 
are  not  authorized  to  collect  or  receive  money 
on  my  account."  The  witness  say.s,  further: 
"Mr.  Fitton  solicited,  in  person,  the  order, 
which  I  handed  to  him  personally,  and  the 
order  mailed  to  him  was  solicited  bj-  him,  in 
person,  during  the  same  time  we  purchased 
goods  direct  from  the  defendant.  Springer. 
Tlie  defendant  mailed  us  tAvo  price  lists,  and 
Mr.  Fitton  has  at  divei-s  times  made  quota- 
tions verbally  to  us.  I  have  other  bills  show- 
ing sales  from  Springer  to  H.  Lieber  &  Co., 
either  verbally  or  through  correspondence, 
but  am  unable  to  fix  any  dates  as  to  when 
such  orders  were  given."  One  Pugh  testified 
that  he  had  acted  as  agent  for  defendant.  Na- 
than Springer.    That  on  the  15th  day  of  May, 

1890,  he  became  the  partner  of  AVarrcn  C. 


402 


STATUTE  OF  FRAUDS. 


Dt-wey,  who  was  at  that  time  the  agent  at 
Giand  Rapitls  for  the  defendant,  for  the  sale 
of  his  products.  That  tlie  agency  ended  on 
the  1st  of  July,  l.S'.)i»,  by  reason  of  Nathan 
Sliringer's  eDterhig  into  a  pool,  in  conse- 
quence of  which  he  could  not  sell  to  parties 
outside  of  the  coiubiuation.  "We  weie  au- 
thorized to  take  orders  foi-  the  defendant  for 
Genuau  looking-glass  plates."  That  "we 
were  in  the  habit  of  accepting  orders  with- 
out submitting  them  to  the  defendant,  except 
iu  cases  where  a  new  account  was  opened, 
when  the  name  was  referred  by  us  to  the 
linancial  agent  at  New  York  of  the  defend- 
ant, for  the  purpose  of  ascertaining  the  linan- 
cial standing  of  such  new  customer,  in  such 
oases,  where  the  standing  of  such  new  cus- 
tomer was  doubtfid.  The  defendant  knew  of 
this  haliit,  and  tilled  orders  that  were  sent  to 
him.  We  were  apprised  of  the  prices  at 
which  we  were  authorized  to.  make  sales 
either  by  cablegram  or  by  letter.  I  do  not 
know  I'rank  O.  Fitton.  I  do  not  know 
whether  he  was  an  agent  of  the  defendant, 
but  I  know  he  was  reputed  to  be,  and  was 
generally  acknowledged  to  be  such  an  agent, 
among  the  trade."  It  is  well  settled  that  the 
authority  of  the  agent  must  depend,  so  fsir 
as  it  involves  the  rights  of  innocent  thii-d 
persons,  who  have  relied  thereon,  upon  the 
character  bestowed,  rather  than  the  instruc- 
tions given.  In  other  words,  the  principal  is 
bound  to  third  persons,  acting  in  ignorance  of 
any  Umitations,  by  the  apparent  authority 
given,  and  not  by  the  express  authoritj-.  Me- 
cliam,  Ag.  l:8>.  The  question  is  not,  what  was 
the  authority  actually  given?  but,  what  was 
the  plaintiff,  in  dealing  with  the  agent,  justi- 
fied in  believing  the  authority  to  be?  Price 
v.  Earl  of  Torrington,  1  Amei*.  Lead.  Cas. 
G»;7,  mS;  Griggs  v.  Selden,  (Vt.)  5  Atl.  Rep. 
no4;  Insurance  Co.  v.  Pierce.  75  111.  420; 
Packet  Co.  v.  Parker,  5U  111.  23;  Inglish  v. 
Ayer,  79  :\Iich.  .510,  44  N.  W.  Rep.  942.  What- 
ever attributes  properly  belong  to  the 
character  bestowed  will  be  presumed  to 
exist,  and  they  cannot  be  cut  oft"  by  private 
instructions  of  which  thej'  who  deal  with  the 
agent  are  ignorant.  Among  those  attributes 
is  the  power  to  do  all  that  is  usual  and 
necessary  to  accomplish  the  object  for  which 
the  agency  was  created.  Mecham,  Ag.  047; 
Tobacco  Co.  v.  Jenison,  48  Mich.  4.59-462, 
12  N.  W.  Rep.  055.  Parties  sent  out  by 
manufacturers  to  solicit  orders  are  held  out 
to  the  trade  as  having  authority  to  act  ac- 
cording to  the  general  usage,  practice,  and 
course  of  business  conducted  by  such  man- 
ufacture! s  through  such  agents;  and  the 
question  of  what  is  usual  or  necessary  to  be 
done  by  such  agents  is  ordinarily  for  the 
jury.  In  the  present  case  the  principal  was 
removed  thousands  of  miles  from  the  cus- 
tomer, at  a  point  where,  in  the  ordinary 
course  of  mail,  it  would  take  from  four  to 
six  weeks  to  exchang,'  letters.  We  find  no 
error  in  tlie  instructions  given  upon  the  point 
discuss  L'd. 


The  second  and  third  assignments  of  error 
relate  to  the  admission  of  testimony  tending 
to  show  a  custom  in  selling  glass  to  furniture 
manufacturers—  First,  as  to  the  means  of 
making  such  sales;  and,  second,  as  to  the  ac- 
ceptance of  orders  by  agents  making  the 
sales.  The  evidence  was  objected  to,  im- 
less  coupled  with  a  proposal  to  bring  home  to 
the  defendant  knowledge  of  such  custom. 
bne  of  the  witnesses  had  resided  in  Grand 
Rapids;  was  then  a  resident  of  Chicago;  had, 
wliile  at  Grand  Rapids,  acted  as  agent  for 
defendant;  and,  while  such  agent,  had  habitu- 
ally accepted  orders  without  conference  with 
defendant,  and  to  his  knowledge.  Anothei" 
witness  was  a  resident  of  Chicago,  but  had 
been  comiected  with  a  firm  of  manufacturers 
and  importers  of  looking-glass,  having  their 
place  of  business  in  New  York,  and  their  fac- 
tories at  Fuerth,  Bavaria.  Another  was  a 
salesman,  engaged  in  Illinois  and  Wisconsin, 
selling  mirrors  as  agent  for  foreign  manufac- 
turers. Another  witness  was  a  member,  at 
Indianapolis,  of  a  firm  dealing  in  mirror 
glass,  and  had  been  connected  with  the  firm 
for  22  years.  For  3  years  the  firm  had  been 
buying  mirror  plates  from  defendant,  and 
several  orders  had  been  given  through  Fit- 
ton,  as  agent  for  defendant.  This  evidence 
tended  to  show  that  the  custom  was  not  a 
purely  local  one,  but  one  that  prevailed  gen- 
erally. The  inile  is  that  the  custom  must  be 
one  so  well  settled  and  notorious  as  to  raise 
the  presumption  that  it  was  known  to  buyer 
and  seller.  Mecham,  Ag.  348.  This  presump- 
tion was  not,  therefore,  I'ebutted  by  defend- 
ant's testimony  that  he  was  not  aware  of 
such  custom,  although  it  might  have  been, 
had  the  custom  been  shown  to  have  been  a 
purelj'  local  one.  This  was  shown  to  be  a 
general  custom  pertaining  to  the  glass  trade 
in  this  country,  and  not  confined  to  any  par- 
ticular locality,  as  was  the  case  in  Pennell  v. 
Transportation  Co.,  53  N.  W.  Rep.  1049,  de- 
cided at  the  present  term. 

Upon  the  question  of  damages,  it  is  insist- 
ed that  immediatelj-  after  tlie  receipt  of  de- 
fendant's letter,  or  in  the  early  part  of  May, 
the  advance  in  the  price  of  glass  was  but 
light,  and  that  plaintift's  should  have  at  that 
time  supplied  themselves,  but.  Instead  of  so 
doing,  they  waited  until  the  latter  part  of 
.lime,  at  which  time  the  advance  was  much 
greater.  The  general  rule  is  that  the  meas- 
ure of  damages  for  a  breach  of  contract  to 
sell  and  deliver  personal  property,  when  the 
purchase  price  has  not  been  paid,  is  the  dif- 
ference between  the  contract  price  and  the 
market  price  at  the  time  and -place  of  the 
promised  deliveiy.  Haskell  v.  Hunter,  23 
Mich.  305;  2  Sedg.  Dam.  305.  The  goods 
were  to  be  delivered  at  Chicago,  and  were  to 
be  shipped  not  later  than  May  15th.  In  the 
ordinary  course  it  would  take  from  30  days 
to  2  months  for  them  to  arrive  at  Chicago. 
The  times  of  payuumt  fixed  by  the  contract 
were  net  00  and  9(i  days  after  delivery  at 
Chicago.    The  plaintiff  testified  that  he  placed 


STATUTE  OF   FRAUDS. 


4U3 


a  uumbiT  of  ordi-rs  duilug  the  month  of 
June,  but  tliat  the  parties  refused  to  sliip 
the  goods.  There  was  abundant  testimony 
tending  to  show  tliat  dealers  deohned  and 
evaded  contracts  or  shipments  during  that 
montli,  in  expectation  of  an  advance  in  prices. 
He  says:  "I  tried  to  malvc  hirger  puroliases 
in  June.  I  tried  to  buy  of  Mr.  Hart  and  Mr. 
Gloecker,  and  I  went  myself  to  New  York, 
personally,  to  buy.  I  could  not  get  glass. 
They  gave  me  prices  all  right,  but,  Avhen  1  in- 
quired for  such  sizes  as  I  needed  in  my 
business,  they  unifonnly  said:  'We  have  not 
got  them  now.  A^'ait  a  few  Aveeks,  and  we 
will  give  them  to  you.' "  Referring  to  cer- 
tain New  York  houses,  he  says,  fui-tlier:  "I 
beUeve  those  were  the  only  four  houses  in 
New  York  that  I  had  any  dealings  with,  and 
I  ti'ied  to  buy  glass  of  them  at  that  time.  I 
made  an  effort  to  buy  glass,  and  they  imi- 
fornily  told  me  that  they  had  none  for  sale 
just  now;  to  wait  a  few  days,  and  I  could 
have  all  the  glass  I  wanted."  He  placed  an 
order  on  June  27th,  but  it  was  taken  subject 
to  the  July  advance.  One  of  defendant's  wit- 
nesses testifies  that  he  gave  an  order  to  de- 
fendant in  the  latter  part  of  May,  and  it  was 
declined.  It  was  held  in  Goodrich  v.  Hub- 
bard, 51  ]Mich.  62-70,  16  N.  W.  Rep.  232, 
that,  the  plaintiff  not  having  elected  to  coii- 
sider  the  contract  broken  before  the  arrival 
of  the  time  for  its  full  performance,  he  was 
entitled  to  tlie  difference  in  value  as  of  that 
time.  See,  also,  Schmertz  v.  Dwyer,  53  Pa. 
St.   335;   Kribs   v.   Jones.   44   Md.    398. 

The  court  instnicted  the  jury  that  plain- 
tiffs were  entitled  to  wait  a  reasonable  time 
for  the  goods  to  reach  Chicago,  after  the 
final  date  of  shipment,  and  in  this  we  think 
there  was  no  error.  It  is  very  evident  from 
this  record  that  there  was,  in  fact,  no  market 
price  for  mirror  glass  during  any  time  in  the 
month  of  June,  and  under  the  testimony  the 
goods  could  not  have  reached  plaintiffs  be- 
fore some  time  in  tliat  month. 

The  testimony  of  defendant's  manager  Avas 
taken  bj'  .deposition.  He  testified  that  he 
wrote  the  letter  to  plamtiffs  dated  April  15, 
1890.  and  that  the  defendant  did  not  have  tlie 
manufacturing  capacitj'  to  till  the  order  at 
that  time,  and  imdertook  to  give  additional 
I'easons  Avhy  the  order  had  not  been  tilled, 
viz.  that  the  order  included  a  size  not  con- 
tained in  the  list,  and  that  he  AA-as  unAA^illing 
to  give  plaintiffs  credit  to  the  amount  of  the 
order.    On  cross-examination  tlie  AAitness  tes- 


tified that  they  had  refused  to  ship  an  order 
given  by  the  Kent  Furniture  Company  of 
Grand  Rapids,  dated  May  24,  1890,  tak  -n  by 
one  DeAvey;  that  on  the  20th  of  May.  1890, 
they  cabh'd  Dewey  to  take  no  more  orders; 
that  he  had  a  brother  to  Avhom  he  wrotx?, 
asking  him  to  effect  a  settlement  by  which 
tlie  moneys  owing  from  the  Grand  Rapids 
Furniture  Company  to  the  defendant,  held 
back  by  reason  of  damages  claimed  tov  fail- 
U!-e  to  fill  orders,  might  be  paid  over.  The 
contract  Avith  the  association  is  dated  June 
30,  1890.  Therefore,  it  could  have  nothing  to 
do  with  the  rejection  of  these  orders.  '"Ques- 
tion. What  is  the  name  of  that  a,ssoc:a- 
tion  referred  to  in  that  letter?  Answer.  I 
may  have  referred  in  my  letter  to  a  contract 
which  ^Ir.  Springer  had  sul)sequently  made, 
on  the  30th  of  Jime.  1890.  Avith  the  German 
Looking-Glass  Company,  of  Ncaa'  York.  Q. 
For  Avhat  period  of  years  did  the  contract  re- 
ferred to  in  that  letter  run?  A.  From  June 
30,  1890,  to  December  31,  1892.  Q.  In  that 
letter,  did  you  not  state,  in  substance,  to 
your  brother,  that  you  were  satisfied  the  de- 
fendant had  made  a  mistiike  in  going  into 
that  contract  Avith  the  association  referred  to, 
and  that  you  and  defendant  desired  now  to 
make  such  ari-angements  with  the  Grand 
Rapids  furniture  trade  as  to  be  able  to  re- 
gain their  patronage  when  the  term  of  years 
for  Avhich  defendant  Avas  \mder  contract  not 
to  seU  to  American  houses  should  expire?  A. 
Yes,  it  may  have  been  said,— soraetliing  of  that 
kind.  I  keep  no  copy  of  my  private  letters." 
These  questions  were  objected  to,  but  the 
objections  AA'ere  overruled,  and  we  think  prop- 
erly. This  was  cross-examination,  and  the 
testimony  tended,  to  show  reasons  for  the 
failure  to  fill  the  order,  other  than  given. 
The  jury  were  insti-ucted  that  the  testimony 
was  admitted  for  that  purpose  only. 

A  witness  who  had  written  a  letter  in  which 
he  had  referred  to  an  association  was  asked 
to  name  the  association  referred  to.  The 
question  did  not  necessarily  call  for  the  cori- 
tents  of  a  written  instrument. 

The  testimony  called  for  in  the  question  put 
to  the  A\-itness  Creque,  and  excluded.  Avas 
substantially  given  by  the  witness.  Evidence 
admitted  AA-ithout  objection  tended  to  prove 
the  assertions  made  by  counsel  for  plain- 
tiffs in  his  opening. 

The  nUes  laid  doAvn  dispose  of  the  other 
questions  raised.  The  judgment  is  affirmed. 
The  other  justices  concurred. 


4U4 


STATITE  OF   FKAUDS. 


WARNER  V.  TEXAS  &  P.  RY.  CO. 

(4  C.  C.  A.  ()T3.  54  Fed.  922.) 

Ciituit    Court   of  Appeals,   Fifth   Circuit. 
March  13,  1893. 

In  error  to  the  circuit  court  of  the  United 
States  foi-  tlie  Eastern  district  of  Texas. 

Action  by  Charles  Warner  against  the 
Texas  &  I'acific  Railway  Company  to  re- 
cover damages  for  breach  of  contract.  The 
court  directed  a  verdict  for  defendant,  and 
entered  judgment  thereon.  Plaintiff  brings 
error.  A  motion  to  dismiss  the  writ  of  er- 
ror was  heretofore  denied.  2  U.  S.  App.  647, 
4  C.  C.  A.  670,  .54  Fed.  920.  Judgment  affirm- 
ed. 

H.  Chilton,  for  plaintiff  in  error.  Wm.  Wirt 
Howe  and  T.  J.  Freeman,  for  defendant  in 
error. 

Before  PARDEE  and  McCORMICK,  Cir- 
cuit Judges,  and  TOULMIN,  District  Judge. 

TOULMIN.  District  Judge.  The  plaintiff 
in  error  brought  this  suit  against  the  defend- 
ant in  error,  alleging  in  his  petition  that  In 
1874  he  made  a  contract  with  the  Texas  & 
Pacific  Railway  Company  to  the  effect  that, 
in  consideration  of  his  agreement  to  grade 
the  ground  and  furnish  the  ties  for  a  switch 
on  said  company's  railroad  at  a  point  known 
as  "Warner's  Switch,"  it  would  furnish  the 
iron,  and  complete  and  maintain  such  switch 
at  that  point  for  his  benefit  for  shipping 
purposes  as  long  as  he  needed  it;  that  the 
switch  was  constructed  in  accordance  with 
the  contract,  and  maintained  until  the  19th 
daj'  of  May,  1887,  when,  on  that  day,  it  was 
wrongfully,  and  over  the  protest  of  the  plain- 
tiff, taken  up  and  destroyed  by  certain  per- 
sons, who  were  then  operating  the  defend- 
ant's railway  as  receivers  thereof  by  ap- 
pointment of  the  T'nited  States  circuit  court 
in  and  for  the  Eastern  district  of  Louisiana; 
that  the  defendant  has  ever  since  neglected 
and  refused  to  reconstruct  and  maintain  the 
switch  as  it  contracted  and  agreed  to  do; 
that  by  reason  of  the  removal  of  the  switch 
and  defendant's  i-efusal  to  maintain  the 
same  the  plaintiff  has  been  greatly  damaged 
by  the  consequent  depreciation  of  his  prop- 
erty. The  property  wan  specifically  describ- 
ed, and  consisted  of  timber  lands,  timber 
privileges,  sawmills,  storehouses,  etc.,  all  of 
which,  as  alleged,  had  been  acquired,  at  the 
time  of  the  removal  of  the  switch,  for  the 
purpose  of  carrying  on  the  business  of  saw- 
ing lumlier  for  market,  and  which  was  ren- 
dered much  less  valuable  for  the  want  of  fa- 
cilities for  transporting  his  products  and 
supplies. 

This  suit  is  for  damages  for  the  breach  of 
the  defendant's  agreement.  On  the  trial  be- 
low, when  the  evidence  as  to  the  terms  of 
the  contract  between  the  parties  had  been 
concluded,  and  on  that  issue  alone,  the  court 
held  that  the  contract  was  not  a  valid  and 
binding  one  upon  defendant,  and  instructed 


the  jury  to  return  a  verdict  for  the  defend- 
ant. To  this  action  of  the  court  the  plain- 
tiff" in  error  excepted.  The  record  in  this 
case  presents  but  a  single  question  for  our 
decision,  and  that  is,  "Was  the  contract  be- 
tween Warner  and  the  railroad  company 
void  under  the  statute  of  frauds "ir"  Warner 
agreed  to  furnish  the  ties  and  grade  the 
ground  for  the  switch.  This  he  did  within 
one  year.  The  railroad  company  agreed  to 
maintain  the  switch  for  Warner's  benefit,  "as 
long  as  he  needed  it."  This  agreement  it 
has  broken.  It  was  a  verbal  agreement, 
and  upon  it  this  action  is  founded.  If  this 
agreement  was  "not  to  be  performed  within 
the  space  of  one  year  from  the  making  there- 
of," the  action  cannot  be  maintained.  The 
agx'eement  is.  in  its  terms  as  to  duration, 
indefinite  and  uncertain;  but  if  it  is  appar- 
ent that  it  was  the  intention  of  the  parties^ 
that  it  was  not  to  be  performed  within  the 
space  of  one  year  from  the  time  it  was  made, 
it  would  be  void  under  the  statute  of  the 
state  of  Texas  known  as  the  statute  of 
frauds.  Rev.  St.  art.  2464.  That  statute 
means  to  include  any  agreement  which  by  a 
fair  and  reasonal)le  interpretation  of  the 
terms  used  by  the  parties,  and  in  view  of 
all  the  cirr-umstances  existing  at  the  time, 
does  not  admit  of  its  performance,  according 
to  its  language  and  Intention,  within  a  year 
from  the  time  of  its  making.  Browne.  St. 
Frauds,  §§  273,  283;  Heflin  v.  Milton,  69  Ala. 
356;  McPherson  v.  Cox,  96  U.  S.  416;  Packet 
Co.  V.  Sickles.  5  Wall.  580. 

The  language  used  was,  to  maintain  the 
switch  "as  long  as  he  (Warner)  needed  it." 
What  is  a  fair  and  reasonable  interpretation 
of  this  language,  in  view  of  all  the  circum- 
stances'? What  was  the  intention  and  un- 
derstanding of  the  parties?  To  ascertain 
that  we  must  look  at  all  the  circumstances 
and  surroundings  that  led  to  the  making  of 
the  contract.  What  were  they?  We  find 
Warner  breaking  up  and  abandoning  his 
milling  business  in  other  states,  and  con- 
centrating his  business  in  the  state  of  Texas; 
after  selecting  the  point  at  which  he  desired 
to  locate,  he  piu-chased  large  tracts  of  timber 
land  for  the  purpose  of  carrying  on  and 
maintaining  his  business  in  Texas;  that  the 
point  of  location  was  what  was  afterwards 
known  as  "Warner's  Switch;"  that  at  the 
time  the  agreement  was  made  the  represent- 
ative of  the  railroad  company  who  was  act- 
ing for  the  company  in  the  matter  made  va- 
rious in(iuiries  as  to  the  amount  of  timber 
accessible  to  the  proposed  location,  and  as 
to  Warner's  experience  iu  conducting  mills; 
Warner  stating  that  there  was  enough  tim- 
ber in  sight  to  run  a  sawmill  for  10  years, 
and  that  by  moving  back  some  3  miles  from 
the  railroad  there  would  be  enough  to  run 
a  mill  for  20  years;  and  he  says  that  he  cal- 
culated to  stay  there  as  long  as  he  lived. 
These  facts  and  circumstances,  connected 
with  the  making  of  the  contract,  clearly 
show  that  the  intention  of  the  parties  at  the 


STATUTE  OF   FRAI'DS. 


405 


time  was  that  the  switch  was  to  be  main- 
taiued  peruiaiieutly.  They  at  least  show 
that  it  was  in  the  contemphition  of  the  par- 
ties, and  was  their  uiiderstandiug.  tliat  War- 
ner would  need  the  switch  fur  a  much  long- 
er period  than  one  year  from  the  time  tne 
agreement  to  maintain  it  was  made,  and  the 
proof  is  that  it  was  in  fact  maintained  for 
jibout  13  years.  We  thinii  it  appears  attirm- 
atively  that  the  agreement  was  not  to  be 
performed  within  the  space  of  one  year,  and 
that  it  was  void.  In  a  suit  for  breacli  of 
<'oveuants  in  a  void  contract  there  can  be 
no  recovery.  Crommelin  v.  Thiess.  81  Ala. 
412;    Shakespeare  v.  Alba,  7G  Ala.  350. 


But  the  plaintiff  in  error  contends  that  the 
performance  by  him  within  one  year  of  his 
part  of  the  agreement  took  the  conti'act  out 
of  the  statute  of  frauds.  The  answer  to 
this  contention  is  that  part  performance  of  a 
verbal  contract  within  the  statute  of  frauds 
has  no  effect  at  law  to  take  the  case  out  of 
its  provisions,  but  is  only  a  ground  for  eq- 
uitable relief,  and  cannot  be  urged  as  a  de- 
fense in  a  suit  at  law.  Browne,  St.  Fraud.s, 
§  4.51;  2  Story,  Eq.  .Tur.  §§  ToiJ,  1522,  note  3; 
Railroad  Co.  v.  Mc Alpine,  129  U.  S.  .305.  9 
Sup.  Ct.  286.  We  perceive  no  error  in  the 
ruling  of  the  court  below,  and  the  judgment 
must  be  affirmed. 


406 


STATUTE  OF   FRAUDS. 


BUCK  V.  HAYNES'  ESTATE. 

SAME  V.  PATTERSON. 

(42  N.  W.  949,  75  Mich.  397.) 

Supreme  Court  of  Michigan.     June   21,   18S0. 

Error  to    circuit    court,  Clinton  county; 
Smith.  .Judge. 

lu'dewa  a-  Liion,  for  appellant.     JoJin  G. 
Patterson  and  //.  c&  H.  E.  Wafbikfge,  f« 
appellee. 

LONG,  J.  Claimant  purchased  an  account 
against  Lucy  Ilaynes,  deceased,  from  Dr. 
(iec)r>^eE.  Bliss,  and  filed  it  in  the  probate 
court  as  a  claim  against  her  estate,  May  3. 
1888.  The  account,  as  claimed,  amounted  to 
$97.75,  and  was  for  the  services  of  Dr.  Bliss 
as  a  physician  during  the  sickness  of  Mrs. 
ILiynes  and  her  liusband.  The  claim  was  al- 
lowed at-'i?4.50  in  probate  court,  and  plaintiff 
appealed  to  circuit  court,  where  judgment 
was  entered  in  his  favor  for  .$5.75.  He  now 
brings  the  case  to  this  court  by  writ  of  error. 
On  the  trial  Dr.  Bliss,  the  assignor  of  the  ac- 
count, was  produced  as  a  witness  by  the 
claimant,  and  testified  that  he  knew  Mr.  and 
Mrs.  Ilaynes  in  their  life-time;  that  Mr. 
Ilaynes  died  May  15,  1885,  and  Mrs.  Ilaynes 
died  June  or  July,  1887;  that  he  is  a  physi- 
cian, and  rendered  services  as  such  to  Mr. 
and  Mrs.  Ilaynes  before  their  death;  that  he 
had  an  account  against  iMrs.  Haynes  foi'  such 
services,  and  sold  it  to  Mr.  Buck,  the  claim- 
ant, and  had  now  no  interest  in  the  claim. 
AVitness  further  testified  that,  upon  one  of 
his  visits  to  Mr.  Ilaynes,  Mrs.  Ilaynes  told 
him:  "1  want  you  to  attend  to  liim,  and  do 
the  best  you  can  for  him,  and  I  will  pay  you 
after  harvest," — and  that  he  attended  him  un- 
til he  died,  and  during  that  time  he  furnished 
medicines  to  Mrs.  Ilaynes  as  well  as  her 
husband;  that  on  the  18th  day  of  May,  after 
her  husband  died,  he  furnished  medicines  to 
Mrs.  Haynes,  when  she  promised  to  pay  the 
bills  for  attendance  upon  her  husband;  and 
that  on  June  24th  and  July  15th  he  furnished 
her  medicines,  and  she  died  on  the  16th  of 
July.  The  whole  bill  amounted  to  $97.75, 
and  he  had  not  been  paid  any  part  of  it.  On 
his  cross-examiuaiion,  the  witness  was  asked 
the  i)urj)Ose  of  liis  assigning  the  account  to 
^Ir.  Buck;  if  it  was  so  he  could  be  a  witness 
to  prove  the  account, —  if  that  was  not  the 
purpose  of  the  assignment, — and  answered; 
"1  calculated  it  would  leave  me  free,  and  I 
could  be  a  witness,  if  it  was  necessary." 
The  court  permitted  this  answer  to  be  given, 
under  objection  of  counsel  for  claimant.  Er- 
ror is  assigned  upon  this  ruling.  All  the 
other  assignments  of  error  relate  to  the 
cliaige  of  the  court.  The  court  was  not  in 
error  in  permitting  this  question  to  be  an- 
swered. If  the  assignment  was  only  made 
for  this  purpose,  then  Dr.  Bliss  was  not  a 
competent  witness  to  testify  to  the  account, 
even  if  he  wascompetent  to  testify  under  any 
circumstances  to  matters  which  were  equally 
within  the  knowledge  of  the  deceased.     It  is 


claimed,  however,  that  counsel  for  the  ad- 
ministrator, not  having  made  objection  to 
the  competency  of  the  witness  on  the  ground 
that  the  matters  to  which  he  was  testifying 
were  equally  within  the  knowledge  of  the  de- 
ceased, theielore  this  objection  was  waived, 
and  the  witness  could  not  be  questioned  as 
to  his  motive  in  making  the  assignment. 
The  very  purpose  of  the  inquiry,  however, 
was  to  show  that  the  assignment  was  only 
colorable,  and  that  he  still  had  an  interest  in 
the  account,  and  therefore  he  was  incom- 
petent to  testify  in  relation  to  it.  The  court 
very  properly  received  the  evidence. 

Error  is  assigned  upon  the  following  por- 
tions of  the  charge  of  the  court:  "As  to  the 
medical  services  of  .$15  up  to  April  4,  1885, 
I  think  that  need  not  be  considered  by  you. 
I  don't  think  the  plaintiff  can  recover  for  that 
item.  I  don't  tliink  the  evidence  would  au- 
thorize a  recovery  for  that."  Also:  "Now, 
had  Dr.  Bliss  been  this  claimant  here  against 
the  estate  of  Mrs.  Haynes,  he  could  not  have 
testified  to  the  conversation  between  herself 
and  him,  because  that  would  have  been 
equally  within  her  knowledge.  Inasmuch  as 
she  is  dead,  and  cannot  testify  in  relation  to 
the  mattei',  the  law  would  not  permit  him  to 
testify.  Also:  "There  is  some  testimony 
here  as  to  some  interest  that  the  doctor  has 
in  this  case.  Now,  if  from  this  testimony 
you  think  that  this  assignment  is  only  color- 
able, and  the  doctor  is  the  real  party  in  inter- 
est, then  I  think  his  evidence  as  to  the  con- 
versation between  himself  and  Mrs.  Ilaynes 
ought  to  be  stricken  out  of  this,  and  ought 
not  to  be  considered."  Error  is  also  assigned 
upon  the  remark  of  the  court,  in  answer  to 
an  inquiry  from  one  of  the  jurors,  as  follows: 
"It  seems  that  in  the  probate  court  only 
$4.50  was  allowed,  but  now,  as  it  stands  here, 
I  charge  you  it  should  be  $5.75."  We  see  no 
error  in  this  charge  of  which  the  claimant 
ought  to  complain.  If  any  error  was  com- 
mitted by  the  court,  it  was  not  such  as  prej- 
udiced the  rights  of  the  claimant.  The  mat- 
ter was  left  to  the  jury  to  say  whether  Dr. 
Bliss  had  any  interest  in  tiie  claim,  and,  if 
they  found  he  nad  no  interest  in  it,  then  they 
miglit  consider  his  testimony  as  relating  to  the 
whole  account,  except  the$15,which  the  court 
struck  out;  that  being  the  items  of  the  ac- 
count for  services  rendei'td  Mr.  Ilaynes  before 
the  time  of  the  clainied  arrangement  with 
Mrs.  Ilaynes,  that  she  was  to  be  responsible 
for  the  bill  for  future  services.  Under  the 
undisputed  facts  in  the  case,  however,  all 
but  the  $5.75  was  for  services  rendered  Mr. 
and  Mrs.  Ilaynes  before  the  death  of  the  hus- 
band, and  the  most  of  it  for  services  to  the 
husband.  The  claimant  claimed  to  recover 
under  an  express  contract  made  with  Mrs. 
Haynes  to  become  responsible  for  this  per- 
sonally, and  seeks  to  chaige  it  against  her  es- 
tate under  this  contiai.'t.  fShe  could  be  bound 
by  no  such  contract.  At  the  time  it  was 
made,  if  made  at  all,  she  was  a  married  wo- 
man. It  was  not  a  contract  relating  to  her 
separate   property,  and    her  separate   estate 


STATUTE  or  FKAIDS. 


407 


was  not  to  be  benefited  by  it.  It  was  the 
debt  of  the  husband,  and  she  could  not  be 
made  liable  out  of  her  separate  estate  liy  a 
promise  to  become  surety  for  its  payment, 
and  her  promise,  if  any  was  made,  alter  her 
husband's  death,  to  pay  it,  would  not  be 
binding  upon  her.  It  was  the  promise  to 
pay  the  del)t  of  anotlier  person,  not  made  in 
writing,  and  wholly  without  consideration. 
Under  the  circumstances  here  shown  from 
the  testimony  of  the  doctor  liimself,  clearly 
he  was  not  a  competent  witness  to  prove 
such  a  contract,  or  to  prove  the  account. 
This  part  of  the  case  should  have  been  taken 


from  the  jury.  What  service  he  rendered 
Mrs.  Ilaynes  after  the  deatli  of  lier  husband 
he  could  recover  for,  Ijut  he  was  not  a  com- 
petent witness  to  prove  that  part  of  tlie  ac- 
count, even.  If  either  paity  had  cause  to 
complain  of  the  ruling  of  the  court,  it  was 
the  administiator  and  those  interested  in  the 
estate,  and  not  the  claimant.  The  judgment 
of  the  court  below  must  be  aliirmed,  with 
costs.  AVe  think  this  appeal  is  vexatious, 
and  in  addition  to  the  taxable  costs  allowed 
the  administrator  will  recover  against  the 
claimant  the  sum  of  $25.  The  other  justices 
concurred. 


408 


STATUTE  OF  FRAUDS. 


Duruis  V.  intp:rior  construction  & 

IMPROVEMENT  CO. 

(-,0  X.  W.  103.  88  Mich.  103.) 

Supreme  Court  of  Michigan.    Oct.  30,  1891. 

Error  to  circuit  court,  ^Vayne  county-;  George 
G.'irtner,  Judge. 

Action  by  George  A.  Dupuis  against  the  Inte- 
rior Construction  &  Improvement  Company  on 
a  claim  aggregating  $953.  Plaintiff  recovered 
judgnient  for  !?150.  and  now  brings  error.  Af- 
ti  lined. 

Sidney  T.  Miller,  for  appellant.  Brennan  & 
Donnelly,  for  appellee. 

LONG,  .1.  This  action  was  brought  in  the 
Wayne  circuit  court  upon  claim  made  under 
the  following  bill  of  parllculai's: 

To  111/)  days'  work  of  dredge  Hercules 

and  her  crew $878  00 

To  chanEfing  dipper  on  dredge "  ()0 

The  plaintiff  had  verdict  and  judgment  in 
the  court  below  by  direction  of  the  court  for 
$1.jO.  He  is  not  satistieu  with  the  amount 
of  judgm^'ut.  and  brings  the  case  to  this  court 
by  writ  of  error.  The  claim  made  on  the  part 
ot  the  plaintiff  is  that  on  or  about  the  2yth  day 
of  November.  1S"9,  the  plaintiff,  who  was  pro- 
prietor of  a  dredge,  met  one  Gibney  at  the 
ottice  of  the  defendant,  and  learned  from  him 
that  certain  dredging  was  needed  to  enable  the 
laying  of  a  natural  gas  main  across  the  river 
Rouge,  near  Detroit.  Gibney  stated  at  the  time 
that  all  there  was  to  be  done  was  the  sloping 
of  the  hanlis  of  the  river,  (not  more  than  a 
day's  work  for  the  dredge,)  which  Dupuis 
agreed  to  do  if  paid  for  the  use  of  the  dredge 
from  the  time  it  left  its  moorings;  this  agree- 
ment being  afterwai'ds  ratified  by  a  letter  from 
Dupuis.  offering  to  do  this  work  for  $7-5  a  day. 
and  an  acceptance  by  Gibney,  also  by  letter. 
Ill  pursuance  of  this  agreement,  Dupuis  sent  his 
dredge  on  Monday.  December  2d,  to  the  place 
at  which  the  pipe-line  was  to  cross  the  stream, 
but  found  nobody  thei-e  at  first  to  tell  him  what 
to  do.  So  he  started  to  work  on  what  Gibney 
had  told  him  he  Wi'uted  done,  i.  e.,  the  slop- 
ing of  the  banlis,  and  nearly  finished  it  on  the 
same  day.  On  that  Monday  night  Dupuis 
went  to  the  office  of  the  defendant,  and  there 
told  :\Ir.  Lambing,  one  of  the  officers  of  the  de- 
fendant, that  he  would  not  go  on  with  the 
work  unless  some  one  came  to  show  him  what 
to  do.  and  Mr.  Lambing  accordingly  promised 
to  send  the  defendant's  engineer  the  next  morn- 
ing to  uike  charge  of  the  Avork.  The  next  morn- 
ing Mr.  Lambing  himstlf  appeared,  and  instruct- 
ed Dupuis  to  dig  a  trench  along  a  certain  line, 
which  was  done.  Dupuis  at  this  time  told 
Lanibins  that  the  pipes  could  not  be  laid  on 
the  bottom,  as  it  then  lay,  as  the  Rouge  was 
to  be  dug  deeper  by  the  govei-nment,  and  that 
he  could  not  do  the  work  they  required.  This 
he  also  told  three  officers  of  the  company  whom 
he  met  at  the  company's  office,  and  advised 
them  to  get  Hiram  Walker's  dredge,  which  he 


thought  would  do  the  work.  They  answered 
that  they  had  no  time  to  lose,  as  the  main  must 
be  laid  to  the  city  within  a  time  specified,  and 
asked  him  if  he  could  not  so  change  his  dredge 
as  to  do  the  work,  at  the  same  time  teUing 
him  he  was  working  for  Gibney.  who  was  the 
contractor.  The  plaintiff  claims  at  this  time 
that  he  then  said  to  them  that  from  the  word- 
ing of  the  letter  he  imderstood  he  was  acting 
for  the  company,  but  was  told  by  Mr.  I>ambing 
that  he  was  not,  but  that  he  was  working  for 
Gibney,  the  contractor.  He  said  he  was  sori"y 
for  that,  and  was  then  asked  by  Lambing  if 
he  understood  it  now,  and  he  said  he  did.  That 
Mr.  Campbell,  another  officer  of  the  company, 
was  present,  and  said  to  Lambing:  "We  know- 
Mr.  Dupuis,  and  we  can  tell  him  that  we  will 
keep  enough  of  Mr.  Gibney's  money  back  to 
pay  him  for  the  work  he  will  do  dredging." 
And  Mr.  Lambing  said  it  is  pretty  early  to  do 
that,  when  Campbell  responded:  "We  have  to 
do  the  work;  we  caimot  let  it  be  delayed." 
That  they  then  asked  him  to  fix  a  minimum 
charge  for  the  changes  on  the  dredge,  which  he 
did.  and  signed  a  paper,  agreeing  that  such 
changes  should  not  cost  more  than  $1.50.  That, 
relying  on  these  promises,  he  went  on  and  did 
the  work,  and  now  claims  the  full  amoimt  of 
dredging  and  change  of  dredge  against  the  de- 
fendant company.  The  claim  is  further  made 
by  the  plaintiff  that  there  was  no  testimony 
which  warranted  the  court  in  limiting  the 
amount  to  be  recovered  to  $1.50,  but,  on  the  con- 
trary, that  the  testimony  of  the  plauitiff  shows 
there  was  either:  (1)  A  good  guaranty  for 
the  payment  for  the  fuU  amovmt  due  the  plain- 
tiff for  the  dredging,  including  the  work  con- 
tracted for  by  Gibney;  or  (2)  a  contract  be- 
tween the  company  and  the  plaintiff  for  all  of 
the  work,  except  the  sloping  of  the  banks. 

The  only  question  involved  is  whether  the 
promise  made  by  the  defendant's  officers  to  pay 
the  plaintiff  for  the  work  and  labor  comes  with- 
in the  statute  of  frauds.  It  clearly  appears 
that  the  original  contract  was  made  with  Gib- 
ney, and  there  was  no  misundei'standing  upon 
the  part  of  the  plaintiff  when  he  commenced 
the  work  as  to  who  was  the  person  liable  on 
the  contract.  The  plaintiff  expressly  stated  to 
Mr.  Lambing,  defendant's  manager,  that  he 
understood  the  contract  was  with  Gibney,  and, 
after  the  work  was  completed,  presented  his 
bill  to  Gibney,  and  commenced  suit  against 
Gibney  &  Co.  for  the  claim  he  now  seeks  to 
recover  against  the  defendant,  making  defend- 
ant company  garnishee  defendant  in  that  pro- 
ceeding. That  suit  is  yet  pending.  It  is  evi- 
dent from  the  whole  record  that  the  plaintiff' 
did  not  understand  that  the  defendant  com- 
pany ever  became  liable  upon  the  original  prom- 
ise to  pay  for  the  work,  and  we  think  the  com- 
pany could  not  be  held  liable  upon  the  guaranty 
claimed  to  have  been  made  by  defendant's  offi- 
cers to  pay  Gibney's  debt.  The  defendant  com- 
pany was  properly  held  liable  by  the  court  be- 
low for  the  cost  of  making  changes  in  the 
dredge.     The  other  part  of  the  claim  made  by 


STATUTE  OF  FRAUDS. 


409 


The  plaintiff  falls  directly  witbiu  the  statute  of 
frauds.  It  apijears  that  the  orij^iual  prom- 
isor, Gibney,  has  not  l)een  discharged  from  Ua- 
bility  on  the  contract;  that  contract  ai  prars  yet 
to  be  in  existence,  and  uncanceled.  In  Baker 
V.  Ingersoll.  39  Mich.  15S,  it  Avas  held  that  "a 
verbal  promise  to  pay  for  materials  funiislied 
to  anotlier  person  on  a  contract  made  liy  him. 
and  not  with  the  promisor,  caimot  be  enforced 
so  long  as  the  oiiginal  contract  remains  uncan- 
celed." We  think  the  case  falls  directly  within 
the  ruhng  of  this  court  in  Welch  v.  Marvin,  36 
Mich.   59;    Baker   v.    Ingersoll,    39    Mich.    158; 


Preston  v.  Zekind.  S4  Mich.  041,  48  X.  W.  180; 
Gray  V.  Hennan  (Wis.)  44  X.  W.  24S. 

Some  claim  is  made  by  plaintiff's  counsel  thut 
the  court  below  was  in  error  in  admitting  ia 
evidence  the  papers  in  the  suit  brought  by  the 
plaintiff  against  Gibney  &  Co.  Those  papers 
were  properl3'  admitted  in  evidence  to  show 
that  the  claim  made  by  the  plaintiff  was  the 
identical  claim  made  here,  and  that  it  was  stiU 
in  existence,  uncanceled,  and  that  plaintiff  had 
not  discharged  Gibney  fi'om  liabilitj-.  The 
judgment  must  be  affirmed,  with  costs. 

The  other  justices  concurred. 


410 


STATUTE  OF  FRAUDS. 


MITCHELL  V.   BECK. 

(50  N.  W.  305,  88  Mich.  342.) 

Supreme  Court  of  Michigan.    Nov.  13,  1891. 

Error  to  circuit  court,  Cheboj-gan  comity;  J. 
G.  Ramsdell,  Judge. 

Action  by  Cliauncey  E.  Mitcliell  against 
Alexander  K.  Beclc  on  an  alleged  contract  by 
which  def(>udant  promised  to  pay  for  certain 
labor.  From  a  judgment  for  plaintiff,  de- 
fendant appeals,     .\tlinned. 

McKniglit,  Humphrey  &  (iraut,  for  appel- 
lant.    Bishop  &  McMahon,  for  appellee. 

CHAMPLIN,  C.  J.  In  the  .spring  and  early 
summer  of  ISSO  the  plaintiff,  who  was  the 
owner  of  a  steam-dredge,  did  some  work  there- 
with at  the  mill-docks  of  Smith  &  Daly,  at 
Cheboygan,  Mich.,  and  the  latter  owed  him 
therefor  a  balance  of  about  $700.  As  they 
did  not  pay  this,  he  ceased  to  worlv  for  them. 
On  August  12th  of  the  same  year  he  resumed 
the  work  on  a  promise  that  this  balance  would 
be  paid  at  once.  They  paid  liim  .$300,  and 
promised  the  balance  the  following  day.  On 
the  loth,  and  again  on  the  14th.  of  August  he 
demanded  his  pay,  and,  not  receiving  it  on  the 
latter  day,  gave  his  engineer  orders  to  remove 
tlie  dredge  to  the  mill  of  D.  C.  Pelton,  refusing 
to  work  longar  under  the  contract  with  Smith 
tVc  Daly.  On  the  evening  of  the  same  day  he 
met  the  defendant,  Beck,  at  the  Grand  Cen- 
tral Hotel  otiice.  and  the  contract  was  made 
which  is  the  subject  of  this  controversy.  It 
is  claimed  by  the  plaintiff  that  defendant  was 
having  a  largo  amount  of  lumlier  sawed  at 
his  mill  under  contract  with  Smith  &  Daly. 
Mr.  Smith,  of  the  firm  of  Smith  &  Daly,  had 
seen  both  parties  during  the  day,  and  brought 
about  this  interview.  Plaintiff's  version  of 
his  talk  at  the  hotel  with  Beck  is  substantially 
as  follows:  Beck  said  he  wanted  plaintiff  to 
go  on  and  complete  the  dredging:  that  it  was 
of  as  much  importance  and  benefit  to  him  as 
to  Smith  &  Daly,  because  he  could  not  get 
vessels  to  go  there  and  ship  his  lumber  on  ac- 
couit  of  the  shallow  water;  that  if  plaintiff 
would  go  on  and  complete  the  work  he  would 
give  him  his  note  for  the  amount  as  soon  as 
the  work  w^as  finished;  and  that  any  of  the 
banks  at  Cheboygan  would  cash  the  note. 
This,  plaintiff  says,  he  regarded  as  equivalent 
to  a  cash  contract,  and  on  the  strength  of  it 
remained  and  completed  the  work.  Plaintiff 
says  tliat  Beck  agreed  to  pay  for  all  the  work, 
from  and  including  the  12th  of  August,  and 
on  completing  the  work  plaintiff"  made  out 
the  bill,  and  presented  it  to  A.  K.  Beck.  De- 
fendant does  not  admit  the  conversation  as 
stated  by  plaintiff,  but  admits  that  he  had  a 
conversation  with  him,  and  says  that  his 
agreement  was  to  indorse  or  accept  Smith  & 
Daly's  pai)er  for  $."t00.  He  says  that  he  ex- 
pected to  hold  back  money  due  Smith  lK:  Daly 
for  sawing  to  cover  his  liability  to  plaintiff. 
When  the  bill  was  presented  to  him  he  mis- 
took the  amount  for  .$1,000,  and  said  he  did 
not  think  tliat  he  liad  li(>l(l  back  tliat  amount. 


and  when  it  was  explained  that  tlie  bill  was 
only  for  $1,415  he  was  silent.  There  is  no 
dispute  as  to  the  amount  of  the  bill,  or  that 
the  work  was  done  and  well  done.  The  mill 
burned  the  day  the  dredging  \a-.is  finished. 
It  appears  that  Beck  was  an  otticir  and  stock- 
holder in  the  A.  R.  Beck  Lumber  Company,  a 
corporation,  and  the  defense  to  the  action 
rests  upon  two  grounds:  First,  that  the  agree- 
ment relied  upon  by  the  plaintiff"  is  void  imder 
the  statute  of  frauds;  and,  second,  that  he 
had  no  personal  interest  in  the  dredging,  ex- 
cept as  a  member  of  the  corporation,  and  that 
wliatever  he  said  or  did  was  as  an  agent  of 
the  corporation.  Proof  was  introduced  in  the 
ca.se  tending  to  support  both  of  these  theories. 
The  plaintiff",  under  the  charge  of  the  court, 
recovered  a  judgment.  Error  is  assigned — 
First,  upon  certain  language  used  by  counsel 
in  his  closing  address  to  the  jury;  second,  in 
the  court's  not  directing  a  verdict  in  favor  of 
the  defendant  after  the  testmiony  was  closed; 
and,  third,  upon  the  following  instructions 
given  by  the  court  to  the  jury,  viz.:  "(1)  If 
you  find  that  the  defendant  Beck  did  agree  to 
pay  the  plaintiff"  for  the  dredging  done  at 
Smith  &  Daly's  mill,  from  and  including  Au- 
gust 12.  1889,  and  that  his  leading  object  was 
not  to  secure  credit  for  Smith  &  Daly,  but  tO' 
subserve  his  own  business  purposes,  and  to 
reap  the  benefit  for  himself,  real  or  supposed, 
and  such  benefit  to  himself,  or  the  benefit 
which  he  reaped,  was  the  real  consideration 
of  his  promise,  then  his  undertaking  was  a 
valid  one,  and  does  not  come  within  the  stat- 
ute of  frauds.  (2)  If  you  find  that  Mr.  Beck 
himself  was  to  receive  a  direct  benefit,  in  ex- 
change for  which  his  promise  or  undertaking 
was  given,  it  is  wholly  inmiaterial  whether 
Smith  &  Daly  were  originally  also  liable  or 
not.  (3)  But  if  you  find  that  the  contract  was 
made  by  this  individual,  without  disclosing  his 
agency,  for  tlie  benefit  of  the  A.  R.  Beck  Lum- 
ber Company,  without  any  reference  to  the 
Smith  &  Daly  Lumber  Company's  interests, 
then  your  verdict  will  be  for  the  plaintiff  to 
the  full  amount  of  the  labor  rendered  after  the 
14th,  so  that  your  verdict,  if  it  is  for  the 
plaintiff",  will  be  for  .$1,198.50.  (4)  If  the 
defendant  is  liable  at  all,  he  is  liable  to  the 
full  amount  of  $1, 198.50,  and  interest  from 
the  time  the  labor  was  performed  up  to  the 
present  time.'"  We  do  not  think  that  the- 
language  of  counsel  in  closing  the  case  to  the 
jury  was  such  a  departure  from  appropriate 
argument  as  to  call  for  a  reversal  of  the  judg- 
ment. Neither  do  we  see  any  error  in  the 
instructions  of  the  court  under  the  testimony 
which  was  introduced  before  the  jury.  Tlie 
case  was  fairly  presented  to  the  jury  upon 
the  theory  of  both  parties, — one  that  it  was 
an  oi-iginal  undertaking  on  the  part  of  Beck, 
and  the  other  that  it  was  merely  a  collateral 
agreement  to  the  undertaking  of  Smith  & 
Daly.  The  plaintiff  relied  upon  his  own  tes- 
timony in  tlw  case  that  the  undertaking  was 
to  pay  in  full  for  the  work  which  he  did  after 
a  certain  date.      The  defendant  claimed  that 


STATUTE  OF  FRAUDS. 


411 


he  undertook  to  become  security  for  the 
amount  of  $500  for  Smith  &  Daly.  The  court 
was  therefore  correct  in  charging  the  jury 
that,  if  the  plaintiff  was  entitled  to  recover 
at  all,  he  was  entitled  to  recover  for  the  full 
amount  claimed,  and  unless  he  was  enti- 
tled to  the  full  amount  claimed  he  was  not 
entlUed  to  anything.  This  insti'uction  was 
also  correct  upon  the  question  of  the  individual 


liability  of  Beck  in  entering  into  the  contract 
without  disclosing  his  agency,  although  he 
might  have  been  in  fact  merely  an  agent  act- 
ing for  A.  K.  Beck  Lumber  Company.  We 
discover  no  error  in  the  record,  and  the  judg- 
ment is  affirmed. 


GRANT,  J.,  did  not  sit. 
concuiTed. 


The  other  justices 


412 


STATUTE  OF  FRAUDS. 


STEWART  ct  :il.   V.  JEROME. 

(38  N.  W.  895,  71  Mich.  201.) 

Supreme  Court  of  Michigan.    July  11,  1888. 

Error  to  circuit  court,  Wiiyue  county;  Hen- 
ry N.  Brevoort,  .luclsie. 

.Xssumpsit  by  Dnniel  Stewart  and  Andrew 
T.  Stewart,  partners,  doing  business  as  Dan- 
iel Stewart  &  Son,  against  George  Jerome, 
upon  an  oral  promise  by  defendant  to  pay 
the  debt  of  one  Joseph  H.  Morris.  There 
was  judgment  for  plaintiffs,  and  defendant 
brings  error. 

II.  C.  AVisner,  for  appellant.  Earned  & 
Earned  (D.  A.  Straker,  of  counsel),  for  appel- 
lees. 

CHAMrElX.  J.  The  suit  in  this  case  was 
commenced  by  declaration  which  consisted 
■of  the  common  counts  in  assumpsit.  The 
defendant  demanded  a  bill  of  particidars, 
-and  one  was  served,  wnich  consisted  of  sev- 
eral items  from  May  2  to  June  5,  1884,  of 
oats,  amounting  to  $395.G().  and  a  statement 
that  the  goods  were  sold  and  delivered  to 
Joseph  H.  Morris  for  feed  for  his  livery 
hoi-ses  at  his  stables  on  Michigan  Grand  ave- 
raie.  Detroit;  that  said  Morris  owed  defend- 
ant .$10,000,  and  to  secure  the  same  defend- 
ant held  a  chattel  mortgage  on  Morris'  horses, 
harnesses,  and  other  property  in  said  stables, 
dated  June  4,  1884;  that  said  mortgage  in- 
cluded no  goods  or  stock  of  Morris  acquired 
by  him  after  the  date  thereof,  and  that  Mor- 
ris purchased  and  had  in  his  stables  stock, 
goods,  and  property  not  covered  by  said  mort- 
gage to  the  amount  of  .$4,000;  and  on  or 
about  June  20,  1884.  said  Morris  absconded 
with  intent  to  defraud  his  creditors;  that  ^^aid 
.Terome  took  possession  of  all  of  said  horses, 
•coupes,  carriages,  harnesses,  and  other  prop- 
<^rty,  including  stock  and  property  not  includ- 
ed in  his  moi-tgage,  and  more  than  sufficient 
to  satisfy  plaintiffs'  said  demand,  which,  with 
the  mortgaged  property,  was  liable  to  attach- 
ment; that  of  the  above  written  account, 
all  being  past  due  and  unpaid.  .$200  worth  of 
the  oats  were  at  the  time  Morris  absconded 
then  in  the  stables,  and  not  fed  out,  and 
were  purchased  fraudulently,  and  were  re- 
pleviable  by  plaintitts,  on  the  ground  that 
they  were  obtained  by  fraud  by  said  Mor- 
ris, and  said  plaintiffs  intended  to  proceed 
to  replevin  said  .$200  worth  of  oats,  and 
intended  to  proceed  by  attachment  against 
the  residue  of  the  property  taken  by  de- 
fendant to  satisfy  his  mortgage,  and  not 
covered  by  it;  and  the  defendant  w-ell  know- 
ing all  the  above  premises,  and  in  order  to 
prevent  said  plaintiffs  from  enforcing  pay- 
ment of  their  just  debt  and  lien  by  attach- 
ment and  reple^■i^.  did  promise  and  agree 
with  said  plaintiffs  that  if  they  woidd  for- 
bear to  enforce  their  said  claims  he,  said 
defendant,  would  assume  and  pay  said  debt 
of  said  plaintiffs,  and.  relying  on  said  prom- 
ises of  defendant,  did  so  forbear;    and  took 


no  steps  to  replevin  or  attach  or  attempt  col- 
lection of  their  debt,  and  have  hitherto  for- 
borne until  the  commencement  of  this  suit, 
relying  on  his,  defendant's,  promise  to  pay 
said  debt.  The  defendant  pleaded  the  gen- 
eral issue.  ITpou  the  trial  of  the  cause  the 
plaintiffs,  against  objections  made  by  coun- 
sel for  tlefendant  that  the  proof  oft'ered  was 
inadmissible  under  the  pleadings,  introduced 
evidence  tending  to  prove  the  indebtedness 
of  Morris  to  plaintiff's,  the  execution  of  the 
chattel  mortgage  by  Morris  to  defendant,  the 
departure  of  Morris,  and  the  possession  tak- 
en by  defendant  of  the  whole  stock  and  prop- 
erty in  the  stable,  and  the  promise  of  the  de- 
fendant. The  plaintitts  are  co-partners,  com- 
posed of  Daniel  Stewart,  the  father,  and  his 
son,  Andrew  T.  .\s  soon  as  Daniel  Stewart 
had  learned  that  Morris  had  left  the  city,  he 
went  to  the  stables  on  Michigan  Grand  ave- 
iiue,  and  found  defendant's  servants  in  pos- 
session, and  one  of  them  informed  him  that 
defendant  wished  to  see  him  immediately, 
and  took  him  in  a  buggy  to  the  office  of  de- 
fendant, where  he  had  a  conversation  with 
defendant  as  follows:  "State  what  that  con- 
versation was  fidly.  Answer.  He  asked  me 
how  much  Mr.  INIorris  owed  me.  and  I  told 
him  he  owed  me  .$39.5.00.  at  the  same  time 
handing  him  the  bill.  He  looked  at  it  a  mo- 
ment, and  turned  around  to  me  and  asked 
me  what  I  was  going  to  do.  and  I  told  him  I 
was  going  to  replevin  mj'  oats  and  attach 
other  property  to  get  my  money;  tnat  I 
could  not  afford  to  lose  it.  Question.  Now, 
at  that  time,  what  was  the  fact  of  your  in- 
tending to  attach  any  particular  property  in 
the  stable  that  he  had  recently  been  purchas- 
ing? A.  Mr.  Morris  offered  me,  a  few  days 
before  he  left,  a  span  of  large  bay  mares, 
and  offered  me  them  cheap,  tried  to  persuade 
me  very  much  to  buy  them,  and  also  a  two- 
seated  wagon  that  :Morris  told  me  was  not 
included  and  Jerome  had  no  business  with. 
Q;  Then  you  intended  to  attach  what'^ 
These  horses  and  the  wagon,  you  say.  and 
the  open  account?  A.  Yes,  sir.  Q.  Now, 
Mr.  .Jerome  asked  you  what  you  were  going 
to  do,  and  you  told  him  you  were  going  to 
replevin  your  oats,  and  attach  some  other 
I)roperty,  and  get  your  debt.  What  did  he 
say  to  you?  A.  Be  quiet,  do  nothing,  and  I 
will  pay  you;  that  is  it  exactly.  Q.  What 
else  did  he  say?  A.  That  my  bill  was  similar 
to  a  supply  man  on  a  railroad.— when  the 
railroad  broke  down  the  supply  man  had  to 
be  paid  whoever  was  paid,  and  he  would  pay 
me.  Q.  W^hat  did  you  say  to  that?  A.  AVell, 
I  agreed  to  it."  He  further  testified  that  he 
did  not  replevin  or  attach  because  he  relied 
upon  Mr.  Jerome  paying  him.  and  was  satis- 
fied he  would.  That  he  reported  to  his  son 
the  interview  with  Mr.  Jerome,  and  he  was 
not  satisfied  with  it;  and  they  both  went  the 
second  day  after  to  see  Mr.  Jerome,  when 
nearly  the  same  conversation  was  had  as  be- 
fore. Mr.  Jerome  agreeing  to  pay  them  if  they 
'•stood  quiet,"  and  would  wait  six  months,  to 


STATUTE  OF  FRAUDS. 


4ia 


which  plaintiffs  ajrreed,  at  the  end  of  which 
time  they  called  upon  him,  when  he  offered 
!«200  in  cash  to  settle  the  bill,  or,  if  they 
Avould  wait  10  months,  he  would  pay  the 
whole  face  of  it.  The  plaintiffs  then  aj::reed 
to  wait  10  months,  and  directed  an  entiy  to 
be  made  on  their  books  so  they  would  know 
when  the  10  months  was  up.  At  the  end  of 
this  time  plaintiffs  again  called  upon  defend- 
ant for  payment,  and  he  was  not  yet  ready; 
'•complained  that  he  had  sold  his  business  to 
Edmunds,  but  got  very  little  or  no  money, 
and  he  was  scarce  of  money."  Later  they 
called  again,  and  the  plaintiff  Daniel  Stewart 
testified  to  the  conversation  that  then  oc- 
curred as  follows:  "My  son  went  to  him  and 
asked  him  what  was  the  reason  he  would 
not  pay  us.  Why  didn't  you  let  us  replevin, 
and  attach  at  once,  and  get  our  money?  Je- 
rome got  a  little  wrathy.  and  he  said  that  un- 
less he  was  willing  to  pay  the  bill  we  could 
not  get  it  any  more  than  we  couid  get  the 
paint  off  the  wall."  The  defendant  intro- 
duced no  testimony,  and  the  plaintiffs  re- 
covered. 

The  defen.se  to  the  action  is  placed  upon  two 
grounds:  First.  That  the  promise  of  defend- 
ant is  void  imder  the  statute  which  enacts 
that  every  special  promise  to  answer  for  the 
debt,  default,  or  misdoings  of  another  person 
shall  be  void  unless  some  note  or  memoran- 
dum thereof  t>c  in  writing,  and  signed  by  the 
party  to  be  charged  therewith,  or  by  some 
person  by  him  thereunto  lawfully  authorized. 
Second.  If  not  void,  no  recovery  can  be  had 
upon  such  promise  under  tlie  common  counts 
in  assumpsit.  This  clause  of  the  statute  of 
frauds  has  often  come  before  this  court  for 
consideration.  In  Corklns  v.  Collins,  16  Mich. 
478,  the  plaintiff  sued  Collins  on  a  verbal 
promise  to  pay  a  board  bill  and  money  lent, 
due  from  one  James  Sykes  The  considera- 
tion was  the  release  of  certam  trunks  suppos- 
ed to  be  held  for  the  debt.  The  defense  was 
the  statute  of  frauds.  Mr.  Justice  Campbell 
said:  "Such  a  release  of  a  valid  claim  would 
be  a  sufficient  consideration  for  a  written 
promise,  for,  if  a  consideration  passes  from 
the  promisee,  it  usually  makes  no  difference 
to  whom  it  passes.  *  *  *  It  is  not  pretend- 
ed that  an  extension  of  time,  or  any  other 
agreement  involving  no  release  of  property  or 
extinguishment  of  liability,  if  made  in  favor 
of  the  principal  debtor,  would  authorize  the 
verbal  promise  of  a  third  person  to  pay  the 
debt  to  be  enforced.  But  a  distinction  is 
sought  to  be  drawn  Avhere  property  is  releas- 
ed or  given  up  to  the  debtor.  There  is  no  ob- 
vious reason  for  any  such  distinction.  The 
law  puts  all  valuable  considerations  on  the 
same  footing.  *  *  *  "When  by  the  release 
of  property  from  a  lien  the  party  promising 
to  pay  the  debt  is  enabled  to  apply  it  to  his 
owi.  beuetit,  so  that  the  release  imu'es  to  his 
ow-n  advantage,  i*^  is  quite  eisy  to  see  that  a 
promise  to  pay  the  debt  in  order  to  obtain  the 
release  may  bo  properly  regarded  as  made  on 
his  own  behalf,  and  not  on  the  behalf  of  the 


original  debt(jr;  and  any  possible  advantage 
to  the  latter  is  merely  incidental,  and  is  not 
the  thing  bargrined  for.  That  promise  is 
therefore  in  no  proper  sense  a  promise  to  an- 
swer for  anything  but  the  promisor's  own  re- 
sponsiltilitj,  and  need  not  be  in  writing."  In 
Calkins  v.  Chandler,  IM  Mich.  320.  it  was  held 
that  an  agreement  to  extend  the  time  of  pay- 
ment and  forbear  to  sue  a  third  person,  who 
was  plaintift"'s  debtor,  was  a  sufficient  con- 
sideration fur  defendants"  promise  to  pay. 
And  this  was  because  the  promise  of  defend- 
iints  to  pay  the  debt  of  such  third  person  was 
at  the  same  time,  when  paid,  to  apply  on  an 
indebtediiess  that  was  to  accrue  against  tliem- 
selves.  and  was  consequently  a  promise  to  an- 
swer for  their  own  debt.  And  Mr.  Justice 
Cooley  in  that  case  quotes  with  approval  from 
the  opinion  of  Mr.  Justice  Shaw  in  Nelson  v. 
Boynton,  3  Mete.  (Mass.)  396,  as  follows: 
"The  rule  to  be  derived  from  the  decisions 
seems  to  be  this:  That  cases  are  not  consid- 
ered as  coming  within  the  statute  wlien  the 
pai'ty  promising  has  for  his  object  a  benefit 
which  he  did  not  before  enjoy  accruing  im- 
mediately to  himself.  But  where  the  oljject  f)f 
the  promise  is  to  obtain  the  release  of  the  jier- 
son  or  property  of  the  debtor,  or  other  for- 
bearance or  benefit  to  him,  it  is  within  the 
statute."  In  Curtis  v.  Brown,  5  Cush.  488. 
Shaw,  C.  J.,  said:  "It  is  not  sufficient  ground 
to  prevent  the  operation  of  the  statute  of  frauds 
that  the  plaintiff"  has  relinquished  an  advan- 
tage, or  given  up  a  lien,  in  consequence  of  the 
defendant's  promise,  if  that  advantage  had 
not  also  directly  inured  to  the  (jenelit  of  the 
defendant,  so  as  in  effect  to  make  it  a  pur- 
chase by  the  defendant  of  the  plaintiff".  The 
cases  in  which  it  has  been  held  otherwise  are 
those  where  the  plaintiff",  in  consideration  of 
the  promise,  has  relinquished  some  lien,  ben- 
efit, or  advantage  for  securing  or  recovering 
his  debt,  and  where  by  means  of  such  relin- 
quishment the  same  interest  or  advantage  has 
inured  to  the  benefit  of  the  defendant.  In 
such  cases,  although  the  result  is  that  the  pay- 
ment of  the  debt  of  the  tliird  person  is  eff"ect- 
ed,  it  is  so  incidentally  and  indirectly,  and  the 
substance  of  the  contract  is  the  purchase  by 
the  defendant  of  the  plaintiff  of  the  lien,  right, 
or  benefit  in  question."  The  doctrine  was  de- 
clared and  acted  upon  in  several  other  cases 
in  that  state.  Fish  v.  Thomas,  5  Gray,  4."); 
Jepherson  v.  Hunt,  2  Allen,  417;  Furbish  v. 
Goodnow,  98  Mass.  29G;  Ames  v.  Foster,  100 
Mass.  400;  Wills  v.  Browm,  118  Mass.  137; 
Fears  v.  Story,  131  Mass.  47.  The  same  doc- 
trine is  recognized  in  Wisconsin  (Clapp  v. 
Webb.  52  Wis.  6:38.  9  N.  W.  79G);  and  in  In- 
diana (Crawford  v.  King,  54  Ind.  10;  Palnier 
v.  Blain.  55  Ind.  11);  and  in  Vevmont  tWliit- 
man  v.  Bryant,  49  Vt.  512).  In  New  York  the 
exposition  of  this  section  has  been  somewhat 
variant,  as  will  be  seen  by  reference  to  Leon- 
ard V.  Vredeuburgh,  8  Johns.  29;  Mallory  v. 
GiUett,  21  N.  Y.  412;  Brown  v.  Weber,  38  N. 
Y.  187;  Ackloy  v.  Parmenter.  98  X.  Y'.  425. 
The  latest  enunciation  of  the  principles  which 


414 


STATUTE  OF  FRAUDS. 


should  be  applied  iu  cases  coming  under  this 
provision  of  the  statute  in  that  state  is  by 
Mr.  Justice  Finch,  in  liintoul  v.  White,  15 
N.  E.  318,  (divided  January  17,  1888. •  He  re- 
vie\vs  the  leading  decisions  in  New  York  above 
cited,  and  says  thi'y  "have  ended  iu  estab- 
lishing the  doctrine  in  the  courts  of  this 
state,  which  may  be  stated  with  approximate 
accuracy  thus:  That  where  the  primary  debt 
sid)sists,  and  was  antecedently  contracted, 
the  promise  to  pay  it  is  original  when  it  is 
founded  on  a  now  consideration  moving  to  the 
promisor,  and  beiieticial  to  him,  and  such  that 
the  promisor  tliereby  comes  under  an  inde- 
pend(<nt  duty  of  payment  irrespective  of  the 
liability  of  the  principal  debtor."  The  diffi- 
culty in  applying  the  doctrine,  and  one  which 
has  given  rise  to  much  seeming  conflict  in  tlie 
authorities,  lies  in  the  failure  to  distinguish 
between  the  consideration  for  the  promise  of 
a  lliird  person  to  pay  tlie  debt  of  another,  and 
the  pi'omise  itself,  whether  it  be  to  answer 
for  the  debt  of  another,  or  to  pay  or  perform 
bis  own  ol)ligation.  There  must  be  a  consid- 
eration to  support  every  promise,  A\hethei'  it 
be  evidenced  by  writing  or  not;  and  where 
the  promise  is  to  answer  for  the  debt,  de- 
fault, or  misdoing  of  another,  the  statute  re- 
<iuires  that  such  promise  must  be  evidenced 
hy  writing.  Under  the  undisputed  testimony 
there  can  be  no  doubt  but  that  in  considera- 
tion of  Mr.  Jerome's  promise  the  plaintiffs 
relinquished  an  advantage  which  they  had  for 
securing  their  own  debt.  The  oats  and  the 
horses  and  buggy  not  covered  by  Jerome's 
chattel  mortgage  Avere  liable  to  be  attached  at 
the  suit  of  the  plaintiffs.  This  is  a  sufficient 
consideration  for  the  promise;  but  the  diffi- 
culty is  that  this  advantage  which  the  plain- 
tiffs forbore  to  exercise  or  appropriate  did  not 
inure  to  the  benefit  of  the  defendant.  The 
plaintiffs  had  no  lien  which  they  released. 
They  had  no  title  to  any  of  the  property  which 


they  transferred  to  defendant.  It  was  al- 
leged in  the  notice  attached  to  the  bill  of  par- 
ticulars that  the  plaintiffs  owned  the  oats 
which  they  had  delivered  to  defendant  be- 
cause they  were  obtained  by  fraud,  but  there 
is  no  evidence  which  supports  such  claim.  It 
is  true  that,  by  forbearing  to  attach  such  oats 
and  other  property,  it  was  left  in  the  hands  of 
Jerome,  and  it  may  be  inferred  that  he  con- 
verted such  property  to  liis  own  use.  but  he 
derived  no  riglit  or  title  thereto  from  plaintiffs, 
and  is  still  liable  to  account  to  or  paj^  for  such 
property  to  Mr  Morris,  or  the  time  owner, 
whoever  he  may  be.  There  was  nothing, 
therefore,  wliicli  inured  to  tlie  benefit  of  de- 
fendant, received  from  the  plaintiffs,  which 
supports  a  new  i)romise  or  agreement  to  as- 
sume and  pay  the  amount  as  an  original  debt 
from  defendant  to  plaintiffs.  There  is  noth- 
ing in  the  facts  or  circumstatices  of  this  case 
to  distinguish  it  from  that  of  Waldo  v.  Simon- 
son,  18  Mich.  o4o,  and  we  think  this  case  is 
ruled  by  that.  Had  the  title  to  the  oats  in  the 
bin  remained  in  the  plaintiffs,  and  the  defend- 
ant under  his  promise  had  appropriated  and 
fed  the  oats  to  his  animals,  the  case  would 
have  been  different;  or  had  the  plaintiffs  at- 
tached first,  and  then,  in  consideration  of  the 
promise,  released,  so  that  the  rights  of  posses- 
sion acquired  by  the  attachment  passed  to  de- 
fendant, it  would  have  afforded  a  considera- 
tion for  the  promise  to  pay  the  debt  as  his 
own  within  the  authorities.  The  objection  to 
the  pleadings  stands  or  falls  with  the  ruling 
upon  the  question  as  to  the  promise  being 
void  under  the  statute  of  frauds.  If  the  prom- 
ise had  been  held  good  as  an  original  promise 
to  pay  defendant's  own  debt,  the  common 
counts  would  have  been  sufficient,  and  a  re- 
covery could  have  Ijeen  maintained  under  the 
count  stated.  The  judgment  must  be  revers- 
ed, and  a  new  trial  granted. 
The  other  justices  concurred. 


STATUTE  OF  FRAUDS. 


415 


MICHIGAN   ST.ATE   CO.   v.   IKO.X   UANGE 
&  H.  B.  R.  CO. 

(.")!>  N.  W.  W<J.  lUl  Mirh.  14.) 

Supreme   Court   of   Michigan.      Jiiiii'   ll>.    1894. 

Error  to  circuit  court,  Barasa  county; 
Noruiau  W.  Haire,  Judsio. 

Action  by  Michigan  Slate  Company  asaiu.st 
the  Iron  Range  &  Huron  Bay  Railroad  Com- 
pany. To  a  judgment  for  plaintiff,  defend- 
ant brings  error.     Affirmed. 

Well.s,  Angell.  Boynton  &  McMillan  (Ash- 
ley Pimd,  of  counsel),  for  appellant.  Philip 
T.  Van  Zile  and  Frank  E.  Robson,  tor  ap- 
pelkt'. 

LONG,  J.  This  action  was  commenced  by 
attachment  to  recover  against  the  defendant 
company  the  value  of  certain  merchandise. 
Plaintiff  claims  under  a  written  guaranty, 
signed  by  Milo  Davis,  chief  engineer  of  the 
railroad  company,  as  follows:  "Iron  Range 
&  Huron  Bay  R.  R.  Co.  Milo  Davis,  Chief 
Engineer  and  Superintendent  of  Construc- 
tion. Avon,  Mich..  May  :J3.  1891.  Michi- 
gan Slate  Company,  Avon.  Mich.— Gentlemen: 
Please  deliver  to  Wallace  Dingmau  such  sup- 
plies as  he  may  order  for  the  construction  of 
the  I.  R.  &  H.  B.  R.  R.,  until  further  notice, 
and  the  same  will  either  be  taken  out  of  his 
estimates  from  month  to  month,  or  taken 
from  his  final  estimates,  or,  in  case  of  his 
failure  to  complete  the  job,  from  last  esti- 
mate given  him,  as  the  case  may  be,  if  not 
otherwise  paid;  and  the  Michigan  Slate  Com- 
pany is  hereby  guarantied  against  any  loss 
fi'om  said  Dingman  s  failure  to  pay  for  any 
goods,  tolls,  and  supplies  of  all  descriptions 
furnished  from  this  date.  Milo  Davis,  Chief 
Engineer."  Claim  is  also  made  upon  the 
common  counts  in  assumpsit  for  goods  sold 
and  delivered.  A  bill  of  particulars  was 
tiled,  showing  a  claim  of  indebtedness  of  up- 
wards of  $30,000.  Tlie  plea  was  the  general 
issue,  and  there  was  also  tiled  and  served  an 
affidavit  of  C.  H.  Buhl,  president  of  the  de- 
fendant company,  to  the  effect  that  the  rail- 
road company  never  executed  or  caused  to 
be  executed  the  written  agi-eement  counted 
upon  in  the  plaintiff's  declaration,  and  that 
Milo  Davis,  chief  engineer,  mentioned  in  tlie 
declaration,  had  no  authority  to  execute  any 
such  promise  or  agi-eement  in  behalf  of  the 
defendant  company.  It  appears  that  on 
June  30,  1890.  articles  of  association  of  the 
defendant  company  were  filed  in  the  office 
of  the  secretary  of  state.  The  purpose  of 
the  incorporation,  as  stated  in  the  articles  of 
association,  was  the  construction  of  a  rail- 
road from  some  point  on  Huron  bay,  Baraga 
county,  Mich.,  through  the  counties  of  Ba- 
raga and  Marquette,  to  the  towns  of  Cham- 
pion. Republic,  and  Michigamme.  On  .July 
26,  1890,  a  conti'act  was  made  between  James 
M.  Turner  and  the  defendant  company,  by 
which  Turner  agi-eed  to  imdertake  forthwith, 
and  to  complete  within  one  year  from  the 
date  of  the  couti-act.  so  much  of  the  railroad 


as  lay  between  some  eligible  point  on  Huron 
bay,  Baraga  countj-,  and  the  village  of  Cham- 
pion,   Marquette    county,    together    with    all 
necessary  ore  docks,  stations,  buildings,  etc. 
On  July  27,  1890,  an  agreement  was  signed 
between  Christian  H.  Buhl  and  Henry  Sreph- 
ens,   of    Detroit,  and    James   M.  Turner,  of 
Lansing,  the  substance  of    which  was  that, 
while    the     said    Turner    was    to   take    the 
I    contract  for  the    construction  of    the    road 
I   in  his  own  name,  yet  he  was  to  act  as  much 
for    and    in    behalf   of   tlie    interest   of   said 
Buhl    and    Stephens   as    for   the   interest  of 
him.self ;    and  the  contract  then  sets  forth  the 
relative    rights     and     obligations    of    Buhl, 
Stephens,  and  Turner  under  it.     August  16, 
1890.  a  contract  was  made  between  Wallace 
Dingman,  of  Battle  Creek,   Mich.,  and  said 
James  M.  Turner,  by  which  the  said  Ding- 
man agreed  to  do  all  the  gi-ading,  clearing, 
grubbing,  etc.,  on  said  railroad,  and  to  com- 
plete the  same  on  or  before  August  1,  1891. 
Prior  to  the  time  of  the  organization  of  the 
company.   Milo  Davis,  a  civil  engineer,  had 
been  sent  by  Mr.  Turner  to  make  a  prelimi- 
nary survey  of  tlie  route  which  the  contem- 
plated   railroad    was    to    foUow.     After   the 
organization  of  the  defendant  company,   on 
;  recommendation  of  Mr.  Turner,  an  arrange- 
I  ment  was  made  with  said  Davis  by  which  he 
I   was  to  act  as  chief  engineer  of  the  company. 
!  It  was  also  arranged  that  Mr.    Charles   M. 
I  Turner,  who  was  the  superintendent  of  the 
j   plaintiff  company,  should  act  as  the  auditor 
i  of  the  defendant  company.     James  M.  Tur- 
{   ner  was  tJie  president  and  treasurer  of  the 
[   Michigan  Slate  Company,  and  largely  inter- 
este<l    in    it   pecuniarily.     The  claim   of   the 
plaintiff  company  is  that  it  is  entitled  to  re- 
■  cover  against  the  defendant  company  for  so 
i   much  of  the  goods  described  in   the  bill  of 
;  particulars  as  were  furnished  prior  to  May 
i  23,    1891,    or    up    to    the    time    the    written 
i  guaranty  was  made,  because  of  certain  oral 
-  arrangements  which  it  claimed  to  have  made 
through  its  superintendent,  Charles  M.  Tur- 
i  ner,  with  Milo  Davis,  and  approved  by  James 
i   ^I.  Turner;    and  that  for  the  balance  of  the 
I  goods   the   defendant   company   is   liable   by 
virtue  of  the  written  guaranty  above  set  out. 
The  written  guaranty,  it  is  conceded,  though 
dated   May  23,   1891,    was   not   \ATitten   and 
signed  until  after  that  date.  and.  as  plaintiff 
seems  to  claim,  some  time  in  June  or  July. 
On  the  part  of  the  defendant  testimony  was 
offered,  which,  it  is  claimed,  tended  to  show 
that  neither  Turner  nor  Davis  had  any  au- 
thority,   either    by    virtue    of    the    positions 
held  by  them  or  by  virtue  of  any  power  con- 
ferred   on    them    by    the   railroad    company, 
to  buy  any  goods  on  the  credit  of  the  com- 
pany to  be  used  by   the  contractor  or  sub- 
contractors or  boarding-house  keepers,  or  to 
malve  any  promises  for  the  payment  therefor; 
and  that,  if  such  purchases  or  such  promises 
were    made,    they    were    made    without    the 
knowledge  or  consent  or  ratification  of  the 
company;    that   Milo  Davis    never  had    any 


416 


STATUTE  OF  FRAUDS. 


authority  to  make  the  written  aj^reenieut 
declared  upon,  and  that  the  conii)anj-  had  no 
Ivnowiedye  tliat  such  agreement  had  ever 
l)een  made. 

The  main  features  of  thi*  case  reUitive  to 
the  orsanization  of  the  defendant  company, 
its  contract  with  James  M.  Turner  to  con- 
struct its  road,  as  well  as  the  contract  be- 
tween Turner  and  Wallace  Dingman,  to- 
\;-ether  with  the  a!)pointment  of  Milo  Davis 
as  chief  engineer  of  the  defendant  company 
and  his  powers  and  duties,  are  set  out  in 
the  case  of  Hirschmann  v.  Railroad  Co.,  97 
-Mich.  384,  50  N.  W.  S4i*.  and  will  not  be  re- 
peated here.  It  was  said  in  that  case  that 
•"the  testimony  l)rings  the  case  within  any 
one  of  the  several  well-established  rules:" 
(I)  "If  the  company  relinquished  to  Turner 
the  matter  of  the  construction  of  this  road, 
and  Turner  knew  that  Davis  was  contract- 
ing these  obligations  in  the  name  and  upon 
the  credit  of  the  company.  Turner  must  be 
deemed  to  have  adopted  them.  His  knowl- 
edge was  the  company's  knowledge,  and  the 
company  is  liable."  (2)  "If  the  officers  of 
the  company  were  advised  that  Davis  had 
incurred  the  June  indebtedness  to  plaintiffs 
in  the  name  and  upon  the  credit  of  the  com- 
pany, and  with  that  knowledge  did  not  pro- 
test, but,  on  the  contrary,  corresponded  di- 
rectly with  the  plaintiffs,  and  paid  that  ac- 
count, plaintiffs  were  justitied  in  relying 
upon  that  action  as  an  assui'ance  of  Davis' 
authority,  and  extending  further  credit,  and 
defendant  is  estopped  from  denying  the  au- 
thority of  Davis."  (8)  "If  Davis,  in  tlie  ex- 
ercise of  the  authority  given  to  him  by  the 
contract  in  view  of  Dinginan's  inability,  was 
prosecuting  the  work  for  and  on  l)ehalf  of 
the  company,  and  incurred  this  indebted- 
ness in  such  prosecution  of  the  work,  the 
plaintiffs  are  entitled  to  recover."  (4)  "If 
Davis  was  entering  into  contracts  for  the 
work  upon  tlie  road,  employing  men,  and 
purchasing  supplies  in  the  name  of  the  com- 
pany and  upon  its  credit,  and  the  officers 
of  the  company  knew  of  the  fact,  or  had 
l)een  advised  of  instances  of  like  conduct, 
and  remained  silent,  the  company  cannot 
now  be  heard. to  say  that  such  person  so 
acting  was  without  authority."  It  is  there- 
fore to  be  seen  whether  this  case  falls  with- 
in any  of  the  above-mentioned  principles. 

Some  time  in  August,  1890,  Mr.  C.  M.  Tur- 
ner, as  he  testifies,  commenced  selling  goods 
for  the  plaintiff  to  Wallace  Dingman.  Some 
of  these  goods  were  paid  for  by  Dingman. 
and  some  by  Davis,  for  the  defendant  com- 
pany. The  account  was  balanced,  Mr.  Tur- 
ner says,  about  March  1,  1891,  all  but  $100, 
which  was  carried  over  to  the  March  ac- 
count. In  tl\-it  month  Mr.  Davis  came  to 
Avon,  and  asked  him  why  he  did  not  sell 
the  goods  that  were  wanted  at  the  camps; 
that  a  large  amount  w'as  wanted.  Mr.  Tur- 
ner told  him  that  Dingman  was  in  bad 
shape  pecuniarily  for  so  large  an  amount, 
when  Davis  said:    "Once  you  get  the  busi- 


ness, you  get  orders  for  the  goods,  and  I  will 
guaranty  that  you  get  your  pay.  1  will  see 
that  you  get  your  pay  for  the  goods."  JNIr. 
Turner  says  that  on  the  strength  of  this 
guaranty  he  obtained  the  orders  from  Ding- 
man, and  fm-nished  the  goods.  He  further 
testified  that  ho  called  the  attention  of 
James  M.  Turner  to  the  matter,  who  tnld 
him  to  go  ahead,  and  furnish  the  supplies. 
Mr.  Turner  says  that  thereafter  be  oi-dered 
a  large  amount  of  goods  from  merchants 
with  whom  he  dealt,  and  commenced  at 
once  to  supply  the  defendant's  camps  with 
them.  He  continued  to  do  so  until  June 
17,  1891,  when  he  looked  over  the  account 
with  Davis,  and  settled  with  him  for  the 
goods  so  furnished  to  that  date,  and  took 
from  him  a  time  check,  showing  that  there 
was  a  balance  due  the  plaintiff  of  the  sum 
of  $9,830.78.  The  account  was  made  out  to 
the  defendant  company,  Wallace  Dingman, 
contractor,  and  indorsed  "Approved"  by 
Milo  Davis,  chief  engineer  of  the  defend- 
ant company.  Prior  to  this,  and  about  the 
1st  of  May,  C.  M.  Turner  had  called  upon 
Davis  for  money.  There  was  then  due  the 
plaintiff  about  $10,000,  and  he  procured  an 
order  for  that  amount  of  money,  as  follows: 
"Avon,  Mich.,  May  15,  1891.  Iron  Range  & 
Huron  Bay  R.  R.  Co.:  Please  pay  Michigan 
Slate  Company  the  sum  of  ten  thousand 
and  twenty-nine  and  ninety-four  hundredths 
dollars,  the  balance  of  the  amount  due  on 
account,  and  charge  same  to  me.  Wallace 
Dingman,  by  Geo.  L.  Davis.  [Signed]  Milo 
Davis,  Chief  Engineer."  AVith  this  order 
Mr.  Turner  was  given  a  letter  to  Mr.  Pierce, 
chief  accoimtant  of  the  defendant  company 
as  follows:  "Avon,  Mich.,  May  15,  1891. 
D.  R.  Pierce,  Chief  Accountant  I.  R.  &  H. 
B.  R.  R.  Co.,  Detroit,  Mich.— Dear  Sir:  The 
Michigan  Slate  Company  is  in  such  shape 
that  they  must  have  the  amount  of  their  bill 
against  W.  Dingman.  We  have  barely 
enough  money  to  pay  the  rolls,  and  the  only 
way  I  could  see  to  help  them  out  was  to 
sign  an  order  on  the  railroad  company  for 
the  amount  of  their  bill.  Yours,  truly,  Milo 
Davis,  Chief  Engineer."  Mr.  Tui'uer  says 
that  at  this  time  James  M.  Turner  had 
failed  in  business,  and  the  Michigan  Slate 
Company  was  in  need  of  the  money.  He 
took  the  order  and  letter,  and  came  to  De- 
troit to  see  Mr.  Buhl.  He  testifies  that  Mr. 
Buhl  told  him  at  that  time  that  they  had 
made  up  the  monthly  account  of  estimates, 
and  had  no  money  on  hand  for  that  matter, 
and  could  not  pay  it.  He  says  further  that 
he  thinks  ^Ir.  Buhl  directeu  him  to  file  it 
with  Mr.  Pierce,  but  that  Pierce  objected 
to  it,  because  at  that  time  it  was  not  signed 
by  Mr.  Dingman;  that  he  took  it  home,  and 
Dingman's  signature  and  O.  K.  was  pro- 
cured, and  he  then  sent  it  to  Pierce.  Mr. 
Turner  further  says  that  he  saw  Davis, 
who  assured  him  that  if  he  continued  to  sell 
goods  he  woidd  get  his  pay,  and  that  Davis 
soon  after  agreed  to  guai'anty  the  slate  com- 


STATUTE  OF  FRAUDS. 


417 


pany  for  all  loss  arising  from  sales  of  goods 
to  Diuguiau,  aiifl  that  Davis  afterwards  put 
it  in  writing.  He  continued  to  sell  goods  un- 
der the  written  guaranty  until  the  balance 
of  the  bill  was  made.  The  defendant's  con- 
tention is  that  neither  Mr.  James  M.  Turner 
nor  Mr.  Davis  had  authority  to  bind  the  de- 
fendant company.  The  relation  of  Mr. 
James  M.  Turner  to  the  company  was  pecu- 
liar. He  was  the  originator  of  the  scheme 
for  the  building  of  the  road.  The  contract 
between  Buhl,  Stephens,  and  Turner  is  fully 
set  out  in  Hirschmann  v.  Railroad  Co., 
supra.  The  contract  provides  substantially 
that  the  parties  associated  for  the  pin-pose 
of  "constructing,  owning,  and  operating" 
the  road,  and  it  was  to  be  sold  as  an  entirety 
within  three  years  after  completion.  Tur- 
ner was  to  take  all  the  stock  and  bonds  for 
building  it;  to  give  his  note  for  one-third 
of  the  cost,  Buhl  and  Stephens  furnishing 
the  entire  money  for  construction;  Turner's 
one-third  of  the  stock  and  bonds  to  remain 
in  the  hands  of  Buhl  and  Stephens  as  se- 
curity; the  notes  to  be  caiTied  until  the  road 
was  sold.  It  is  evident  that  under  this  con- 
tract the  three  parties,  Buhl,  Stephens,  and 
Tm-ner,  regarded  themselves  as  the  sole  own- 
ers of  the  road,  and  of  all  the  rights  and  in- 
terests therein,  and  when  it  was  sold  they 
were  to  divide  the  proceeds  equally  between 
themselves.  Mr.  James  F.  Joy  had  original- 
ly entered  into  the  scheme  of  building  the 
road,  but  Mr.  Turner  says  he  dropped  out, 
and  it  was  imderstood  that  the  money  he 
put  in  should  remain  in  the  pool,  and  they 
would  make  some  arrangement  that  would 
:ie  satisfactory  to  him  aboiit  it.  It  appears 
that  INIr.  Joy  never  had  anything  to  do  about 
the  matter  after  that,  but  that  the  three  par- 
ties went  forward  with  the  scheme  as  though 
tbey  were  the  sole  owners.  Mr.  Turner  did 
not  sign  the  articles  of  association,  and  he 
claims  he  was  left  out  so  that  he  could  take 
the  contract  for  the  stock  and  bonds.  These 
three  then  became  the  sole  managers  of  the 
defendant  company.  They  consulted  no  one 
else  about  the  management  of  the  affairs  of 
the  company,  according  to  James  M.  Tur- 
ner's testimony.  They  appointed  Milo  Davis 
as  chief  engineer,  and  he  was  directed  by 
them  to  advertise  for  bids,  and  the  con- 
tract for  the  actual  construction  was  let  to 
Dingman.  This  contract  was  signed  by 
Turner.  Shortly  after  it  was  executed,  Da- 
vis Avent  to  tlie  I'pper  Peninsula,  and  the 
work  of  construction  commenced.  On  No- 
vember 15,  18'.)0,  the  Dingman  contract  was 
modified,  Buhl  and  Stephens  alone  making 
the  agreement  of  modification,  and  after- 
wards Turner  approved  it.  No  one  else  con- 
nected with  the  company  appears  to  have 
been  consulted,  and  the  work  was  thereafter 
carried  forward  up  to  September,  1891.  The 
moneys  to  carry  on  the  work  were  sent  by 
the  company  to  Dingman  up  to  some  time  in 
January,  1891,  and  after  that  time  to  C.  M. 
Turner  or  Milo  Davis,  or  paid  out  by  checks 

VAN  ZILE  SEr..C.\S.SALES — 27 


directly  from  Mr.  Pierce,  the  accountant  at 
Detroit.  Mr.  Davis  had  sole  charge  of  the 
work,  except  as  James  M.  Turner  went  up 
from  time  to  time  to  look  after  it.  Mr.  Da- 
vis had  his  instructions  from  Mr.  Turner. 
The  railroad  office  and  Dingman's  office  wero 
in  the  same  Imikling,  and  for  the  greater  por- 
tion of  the  time  covered  by  the  accounts  Mr. 
Clark  acted  as  bookkeeper  for  both  parties. 
Goods  were  fiirnished  by  various  parties 
upon  orders  made  by  Dingman,  per  Clark. 
Other  goods  by  various  parties  were  fur- 
nished under  the  direction  of  Davis,  who 
had  arranged  that  certain  parties  were  to 
have  goods  when  needed.  The  goods  were 
entered  upon  the  books  separately  against 
each  camp,  and  at  the  end  of  the  mnnth  the 
separate  accounts  were  posted  to  Dingman'.s 
account.  Other  parties  besides  the  ])laintiff 
delivered  goods  and  posted  their  books  In 
the  same  way.  At  the  end  of  each  month 
the  requisitions  were  made  for  the  amounts 
needed  to  pay  the  various  accounts,  and  sent 
along  with  the  monthly  estimates  and  paid. 
Payments  were  made  in  this  way  until  about 
May  1,  1891,  when  Mr.  Davis  gave  >Ir.  C. 
M.  Tiu-ner,  for  plaintiff,  the  order  for  the 
$10,000. 

By  the  terms  of  the  Dingman  contract,  the 
defendant  company  had  the  riglit  at  any 
time,  if  Dingman  neglected  or  refused  to 
prosecute  the  work  with  a  sufficient  force  to 
complete  it  within  the  agreed  time,  to  take 
possession  and  complete  it.  It  is  also  con- 
tended by  plaintiff  that  in  the  fall  of  18:)0, 
and  before  the  goods  in  question  were  fur- 
nished, the  defendant  company,  through 
Davis,  discovered  that  Dingman  was  not 
competent  to  carry  on  the  work  and  finish 
the  contract,  and  so,  availing  themselves  of 
the  foregoing  clause  in  the  contract,  the 
company  took  charge  of  the  work,  and  final- 
ly took  it  fully  out  of  Dingman's  hands,  and 
prosecuted  it  by  Davis,  though  it  was  nomi- 
nally carried  on  in  Dingman's  name.  There 
are  many  circumstances  which  have  a  strong 
tendency  to  support  that  claim,  though  some 
of  the  letters  and  statements  of  James  M. 
Tiirner  are  quite  contradictory  of  that  theory. 
However  this  may  be,  it  is  apparent  that  the 
matter  was  left  to  James  :M.  Turner  to  man- 
age, and  that  Davis,  acting  imder  IMr.  Tur- 
ner's direction,  went  forward  with  the  work, 
or  at  least  directed  and  controlled  it;  and 
that  the  goods  for  which  suit  is  brought  were 
furnished  by  C.  M.  Turner  for  the  plaintiff, 
on  the  strength  of  Davis'  promise  that  they 
should  be  paid  for.  Tc^stimony  was  given  by 
other  parties  who  furnished  goods,  showing 
that  Davis  ordered  such  goods  for  the  com- 
pany; also  testimony  showing  that  some 
time  in  April,  and  from  that  time  forward. 
Davis  hired  men  for  the  work,  and  gave  them 
time  checks,  which  were  paid  by  the  com- 
pany. It  also  appeared  that  Davis,  in  the 
course  of  his  correspondence  with  .Tames  M. 
Turner  and  with  Mr.  Buhl  and  others,  gen- 
erally used  letter*  paper  which  contained  the 


418 


STATUTE   OF  FRAUDS. 


heading  of  the  defendaut  company,  "Mile 
Davis,  Cliief  p]ng:ineer  and  Superintondont 
of  Constniction."  and  that  Davis  said  from 
time  to  time  that  Dingman  was  unable  to 
prosecute  the  work,  and  the  company  was 
complotin.ir  it.  It  appeared  in  this  case,  as 
in  Ilirsclnnann  v.  Kaih'oad  Co.,  supra,  that 
the  .Tune  bills,  while  ag}?resating  a  large 
amount,-- over  .$50,000,— contained  an  amount 
going  to  Dingman  of  only  $2.")0.  and  in  the 
July  accounts  the  amount  was  nearly  $.jr>,- 
000.  and  to  Dingman  only  $2.50.  How  the 
matter  of  the  constniction  of  the  road  was 
regarded  by  the  parties  is  illustrated  by  the 
letters  passing  between  them  at  the  time. 
In  a  letter  from  Mr.  Stephens  to  .Tames  M. 
Turner,  dated  Aus-ust  5,  ISOO,  he  says:  "If 
possible,  I  would  like  this  letting  of  the  con- 
tract to  you  wiped  out  of  the  organization, 
and  the  contract  between  us  three  to  read  as 
we  have  talked,  viz.:  Mr.  Buhl  and  myself 
furnishing  the  money,  if  necessary,  up  to 
$500,000.  We  each  own  one-third,  for  which 
you  give  your  notes  from  time  to  time,  se- 
cured by  your  one  third  of  the  stock  and 
bonds.  That's  all  there  is  to  it,  and  I  am  ig- 
norant of  the  necessity  of  dragging  in  and 
lumbering  up  an  agreement  with  a  contract 
to  you  for  construction  of  the  road."  Mr. 
Turner,  in  his  testimony,  says:  "Mr.  Buhl, 
Mr.  Stephens,  and  myself  are  the  company; 
but  it  was  thought,  as  the  contract  ran  to 
me,  that  I  better  not  appear  as  a  stockholder, 
in  order  to  have  it  legal."  We  have  seen 
that  Mr.  Davis  hel;l  himself  out  as  the  agent 
of  the  company  to  various  parties  from  whom 
goods  were  purchased,  and  to  men  whom  he 
employed  for  the  company,  and  that  the  af- 
fairs of  the  company  were  largely  condticted 
by  him,  or  imder  his  direction,  from  the 
spring  of  1S91  forward.  .Tames  M.  Turner 
was  the  active  party  for  Buhl,  Stephens,  and 
Turner.  The  whole  affairs  of  the  company 
were  in  their  hands.  Mr.  Turner,  while  so 
acting,  gave  direction  to  Davis.  Mr.  Turner 
says:  "I  was  to  look  after  the  building  of 
the  road,  and  employ  the  men,  and  see  to  it. 
After  Mr.  Davis  came  up,  I  gave  him  most  of 
his  orders  direct  from  my  otfice  as  between 
us  three."  He  says  further:  "Davis'  duties 
were  to  see  that  the  men  and  teams  were 
fed,  and  it  was  impossible  to  feed  them  with- 
out some  one  being  responsible  for  it."  He 
also  says  that  he  said  to  C.  M.  Turner,  if  he 
would  make  the  arrangement  with  Davis, 
and  turn  in  the  bills  at  the  end  of  each 
month,  so  as  to  be  checked  up  and  charged  to 
the  various  persons,  that  the  company  would 
pay  for  all  the  supplies  that  he  would  fur- 
nish. .Tames  M.  Turner  also  testified  that 
when  the  Jime  estimates  were  presented  Mr. 
Buhl,  Mr.  Stephens,  Dingman,  and  himself 
met  in  Detroit,  and  looked  them  over.  That 
Dingman  knew  but  little  about  them.  Milo 
Davis  was  there,  and  wanteil  about  $.50,000, 
aside  from  the  pay  rolls,  for  mercantile  ac- 
coimts  and  accounts  at  two  baidis.  The  ac- 
counts were  all  looked  over  and  scaled  down 


as  much  as  possible,  but  some  were  to  be  paid 
by  the  company  that  luonth,  and  were  paid. 
Mr.  .Tohnson,  a  witness  for  plaintiff,  testlied 
that  Mr.  Buhl  on  one  occasion  told  him  in  De- 
troit that  Milo  Davis  "is  our  agent  up  there." 
This  testimony,  and  the  claims  of  plaintiff, 
are  contradicted  by  Mr.  Buhl,  Mr.  Stephens, 
and  others;  but  the  testimony  and  claims  of 
the  plaintilf  were  proper  for  the  considerafon 
of  the  jury  in  determining  the  quv'Stinn  raised. 
The  cotul,  tipon  this  testimony,  and  the 
claims  made  by  the  plaintiff,  directed  the 
jury  substantially  that  if  they  found  that  Da- 
vis was  the  agent  of  the  defendant  company 
with  power  to  pledge  the  credit  of  the  com- 
pany to  pay  for  goods  of  the  kind  in  ques- 
tion furnished  aknig  the  line  of  the  road,  and 
that  he  did  in  behalf  of  the  company  verbal- 
ly agree  that  the  company  should  pay  for 
them,  and  plaintiff  furnished  the  gotxls  in 
conformity  to  the  agreement,  relying  upon 
that  agreement,  and  looking  solely  to  the  de- 
fendant for  the  price,  and  not  to  Mr.  Ding- 
man, they  should  find  for  the  plaintiff  for 
the  value  of  the  goods  furnislied  before  the 
time  the  written  si^iaranty  was  made.  But, 
if  the  plaintiff  looked  both  to  the  company 
and  to  Dingman  for  .such  goods,  they  must 
find  for  the  d(^fendant,  as,  in  order  to  recov- 
er, they  must  find  that  plaintiff  looked  only 
to  the  company,  and  not  to  Dingman  at  all. 
As  to  the  goods  sold  under  the  written  guar- 
anty, the  court  instructed  the  jury  that  if 
they  foimd  that  Davis  was  authorized  to 
make  the  guaranty  in  behalf  of  the  com^ 
pany,  it  would  bind  the  company;  and,  if 
they  found  that  Dingman  failed  to  pay  for 
the  goods  so  fiu-ni.shed,  the  defendant  would 
l>e  liable  for  their  value. 
It  is  contended  by  defendant: 
First.  That  the  admission  of  testimony 
bowing  that  Piihl  and  Stephens  were  the 
leavy  subscribers  to  the  stock  of  the  com- 
'iiny  was  error  prejudicial  to  the  riglits  of 
he  defendant  company,  as  its  tendency  was 
to  impress  the  jury  that  Buhl  and  Stephens 
■vere  the  railroad  company.  It  is  true  that 
'he  introduction  in  evidence  of  the  contracts 
between  Buhl,  Stephens,  and  Turner  and  the 
testimony  in  relation  thereto  may  have  had 
*^h.at  tendency,  and  the  jury  may  have  beon 
impressed  with  the  idea  that  these  parties 
were  the  company;  but  the  evidence  was 
competent  for  the  puriiose  of  showing  the 
authority  of  Turner  in  the  premises.  Coun- 
sel for  defendant  very  aptly  states  the  ques- 
tions here  involved  as  follows:  "Had  Tur- 
ner, by  virtue  of  his  relations  with  Buhl  and 
Stephens,  or  by  virtue  of  any  instruction 
from  them,  power  to  guaranty  payment  to 
the  plaintiff  for  the  supplies  in  qm'Stion: 
or  had  he  the  power,  by  virtue  of  that  rela- 
tion or  those  instructions,  to  authorize  Milo 
Davis  to  make  such  a  guaranty;  or  had 
Milo  Davis,  because  of  the  fact  that  he  was 
chief  engineer  of  the  road,  or  because  of 
any  authoritj'  from  the  company,  power  to 
make  such  a   guaranty?"     The  court  below 


STATUTE  OF  FRAUDS. 


419 


directed  the  jury  that  the  fact  of  Davis 
being  chief  engiucor  did  not  of  itself  imply 
such  authority,  so  that  (lucstion  is  not  in- 
volved here.  It  is  evident  from  the  man- 
ner in  which  the  whole  business  of  the  con- 
struction of  the  road  was  conducted  that 
substantially  Buhl,  Stephens,  and  Turner 
were  the  company,  and  their  acts  are  bind- 
ing upon  the  company  itself.  The  company 
cannot  adopt  the  acts  that  ai'e  advantageous 
to  it  and  i-eject  those  which  are  disadvan- 
tageous to  the  corporation.  It  is  true  that 
there  was  no  formal  corporate  action,  ex- 
cept the  making  of  the  contract  for  the  con- 
struction; but  by  this  contract  Turner  was 
to  have  all  the  stock  and  bonds  of  the  coiu- 
pany,  and  he  made  it  in  the  interest  of 
Buhl,  Stephens,  and  himself,  and  with  the 
understanding  that  tlie  road,  as  soon  as  con- 
structed, was  to  be  sold  out  for  the  benefit 
of  the  three.  Much  greater  power  was  vest- 
ed in  Turner  than  was  found  to  be  vested 
in  Smith  by  the  Smith  Middlings  Purifier 
Company  in  Preston  Nat.  Bank  v.  George  T. 
Smith  Middlings  Purifier  Co.,  84  Mich.  375, 
47  N.  W.  502,  and  there  it  was  said:  "In 
conceding  that  the  president  must  exercise 
his  poAver  of  management  in  subordination 
to  the  board,  yet  when,  as  in  this  case,  the 
stockholders,  being  the  owners,  have  seen 
fit  to  vest  extraordinai-y  powers  of  manage- 
ment in  the  president,  and  certain  other 
powers  in  the  treasurer  and  superintendent, 
and  the  directors,  with  full  knowledge  of 
this,  elect  a  maa  to  fill  all  these  otfices,  and 
thereafter  put  no  restraint  upon  his  manage- 
ment, the  board  must  be  held  to  have  con- 
sented to  his  exercising  all  the  powers  rea- 
sonably included  in  the  language  by  which 
it  was  conferred.  *  *  *  What  the  own- 
ers consent  to  expressly  or  permissibly  they 
oiight  not  to  he  allowed  afterwards  to  deny." 
It  is  substantially  shown  that  all  parties  con- 
nected with  this  enterprise  agreed  that  the 
whole  business  should  be  done  by  and 
through  Buhl,  Stephens,  and  Turner;  and  it 
was  so  done.  No  one  else  had  any  voice 
in  it,  or  took  any  part  in  it.  No  one  else 
seems  to  have  put  a  dollar  of  money  in  to 
cany  out  the  contracts.  Buhl  and  Stephens 
furnished  it  all,  except  what  Mr.  Joy  put 
in  originally,  and  that  appears  to  have  been 
arranged  for.  Buhl  and  Ste[)hens  then  em- 
powered Tm-ner  to  act  for  the  three,  and  he 
did  so  act,  and  his  acts  must  be  held  bind- 
ing upon  the  defendant  company.  This  is 
supported  by  abundant  authority:  Steel 
Works  V.  Bresnahan,  GO  Mich.  332,  27  N.  W. 
524;  Preston  Nat.  Bank  v.  George  T.  Smith 
Middlings  Purifier  Co.,  supra;  Bank  of  Mid- 
dlebury  v.  Rutland  &  W.  R.  Co.,  .".0  Vt.  159: 
Orr  Water-Ditch  Co.  v.  Reno  Water  Co..  10 
Nev.  60.  6  Pac.  72;  Hull  v.  (Jlover,  126  111. 
122.  IS  N.  E.  198;  People  v.  North  River 
Sugar-Refining  Co.,  121  N.  Y.  582,  24  N.  E. 
834.  The  first  proposition,  therefore,  that 
was  laid  down  in  Hirschmann  v.  Railroad 
Co.,  supra,  finds  support  here.     Turns-r  knew 


that  Davis  had  arranged  for  the  goods  with 
plaintiff,  and  ratified  and  confirmed  the  ac- 
tion of  Davis. 

Second.  It  is  contended,  however,  that  Tur- 
ner being  president  of  the  plaintiff  company, 
and    his   powers    being    limited    in    the   con- 
tract, which  provides  that  "no  indebtedness 
shall  be  incuiTed  and  no  expenditures  made 
without   the    full    consent    and    co-operation 
of  all  the  parties  to  this  agreement,"  Tur- 
ner's knowledge  of  this  limitation   was  the 
knowledge  of  plaintiflf,  and  therefore  plain- 
tiff  is  estopped   from   recovery.     There   can 
be  no   doubt  that  Tiu-ner  could  legally   act 
both  for  the  defendant  company— for  Buld, 
Stephens,    and    himself— and    at    the    same 
time    for    the    plaintiff    company.     A    party 
may  act  in  the  double  relation  of  agent  for 
both  parties.     Mining  Co.  v.  Senter,  26  Mich. 
73;    Colwell  v.  Iron  Co.,  36  Mich.  51;    U.  8. 
Rolling-stock  Co.  v.  Atlantic  &  G.  W.  Rail- 
road Co.,  34  Ohio  St.  450;   Mayor,  etc.,  v.  In- 
man,  57  Ga.  370;    Alexander  v.  Williams.  14 
Mo.    -Ipp.  27;    Manufacturers'  Sav.   Bank  v 
Big  Muddy  Iron   Co.,  97   Mo.  38,   10  S.   W. 
865;     Kitchen  v.   Railway   Co.,   69   Mo.   224; 
Fitzsimmons    v.    Express    Co.,    40    Ga.    330. 
There  is  nothing  appearing  in   the   case  to 
show   that  Mr.  C.  M.  Turner,  who  was  the 
geiaeral    manager    of   the   plaintiff   company, 
did  not  act  in  the  utmost  good  faith  in  mak- 
ing the  sales  of  the  goods;  and  it  is  apparent 
that    the    defendant   company    actually    had 
the  benefit  of  the  goods  so  furnished.     The 
plaintiff    company    had    constructed    several 
miles  of  the  road  for  the  defendant  company, 
and  James   M.    Turner  acted  for  both  par- 
ties.    The   plaintiff  company   had   fm-nished 
ties  and  lumber,    which  had  been  paid  for, 
and    the     defendant     company    had     placed 
money    due    the    plaintiff    to    the    credit    of 
James   M.    Turner    for    the    plaintiff.     Some 
other    deals    had    taken    place    between    the 
plaintiff*  and  the  defendant,  in  wliich  James 
M.  Turner  had  acted  for  both  parties,  and  no 
objection  had  been  made  by  the  defendant, 
or  its  officers,  or  by  Buhl  and  Stephens,  so 
far  as   this   record  shows.     It   also   appears 
that   the    limitation   of    an    indebtedness   of 
$25,000  placed  upon  Turner's  power  was  not 
adhered  to  in  all  cases,  and  he  was  permit- 
ted to  go  on  with  the  building  of  the  road  if 
Dingman    failed    to    carry   out   his   contract. 
It  is  not  claimed  that  any  undue  advantage 
was  taken  by   the  plaintiff  company   by  or 
through  this  agency,  the  claim  being  that  no 
power   was   vested   in  James   M.    Turner  or 
Davis  to  authorize  the  purchase  of  the  goods 
or   guaranty    payment   thereof.     Mr.    Turner 
testified  that  he  was  to  look  after  the  build- 
ing of  the  road,  and  to  employ  men  to  see 
to  it.  but  that,  after  Davis  came  up.  he  gave 
him  orders.     Mr.  Buhl  says  that  Turner  had 
authority  to  see  to  the  building  of  the  road 
imder  the  contract;    and,  in  addition  to  this, 
there    is     some     evidence     that     Buhl    and 
Stephens   held   Mr.   Davis  out  as   the  agent 
of  the  company. 


420 


STATUTE  OF  FRAUDS. 


Third.  It  is  contoiulcrl  that  ccrtjiin  testi- 
mony fjiven  by  plaintiff  under  defendant's 
objection  was  inadiuissiWe,  and  error  is  as- 
si^'ned  upon  the  ruling  of  the  court.  This 
testimony  was  to  the  effect  that  Davis  mad(! 
statements  as  to  his  ajjency,  and  directed 
supplies  to  be  furnished  by  different  parties, 
and  in  general  appeared  to  have  autliority 
and  control  over  the  matters  of  the  company, 
making  contracts  for  Avork.  and  directing  the 
work  to  be  done,  and  pnying  for  supplies.  It 
was  held  in  Ilii.schmann  v.  Railroad  Co.,  su- 
pra, that  plaintiff  was  entitled  to  show  what 
powers  had  been  assumed  by  Davis,  and  the 
extent  to  which  he  had  been  contracting  in 
the  name  of  the  co:npany;  and  we  think  the 
rule  was  there  settled  that  this  testimony 
was  admissil)le. 

Fourth.  It  is  claimed  that  the  evidence 
•does  not  show  that  C.  M.  Turner,  as  the  su- 
perintendent of  the  plaintiff  company,  in  sell- 
ing the  goods  for  which  suit  is  brought 
looked  solely  to  the  defendant  for  payment, 
but.  on  the  other  hand,  charged  the  goods  to 
Dingman,  and  that  they  were  sold  on  the 
credit  of  Dingman,  and  the  plaintiff  had  no 
idea  of  looking  to  defendant  for  its  pay,  ex- 
cept in  case  Dingman  failed  to  pay  the  debt, 
and  therefore  the  claim  sued  upon  is  void 
under  the  statute  of  frauds.  We  think  it  ap- 
pears from  the  testimony  of  C.  M.  Turner 
that  he  would  not  sell  the  goods  on  the 
strength  of  Dingman's  credit,  and  he  so 
stated  to  Davis  before  any  goods  were  fur- 
nished. They  were  sold,  according  to  Mr. 
Turner's  statement,  solely  upon  the  faith  of 
the  promise  made  by  Davis  that  the  defend- 
ant company  would  pay  for  them.  This 
question  was  fairly  submitted  to  the  jm-y, 
and  they  have  found  against  defendant's  con- 
tention upon  the  facts.  We  think,  under  the 
facts  of  this  case,  the  principle  laid  Jilown  in 
Bice  V.  Building  Co.,  9G  Mich.  24.  5.5  N.  W. 
382,  plainly  applicable.  In  that  case  the  de- 
fendant company  had  the  right,  under  their 
contract  with  Wilson  &  Moore,  at  any  time 
when  the  contractors  failed  to  prosecute  the 
work  with  diligence,  to  provide  materials 
themselves,   and   deduct  the   costs   from   the 


money  due  on  the  contract.  When  the  de- 
fendant found  that  tl.e  plaintiffs  would  fur- 
nish no  more  materials  to  Wilson  &  Moore,  or 
upon  their  credit,  it  agreed  to  make  the  pny- 
ment  directly  to  the  plaintiff,  and  it  was  held 
that  the  case  was  not  within  the  statute  of 
frauds;  citing  Nelson  v.  Boynton,  3  Mete. 
(Mass.)  396,  in  which  it  was  said:  "The  ob- 
ject to  be  accomplished  by  the  defendant 
company  was  the  immediate  acquisition  of 
these  materials  to  put  into  the  building.  The 
purpose  was  not  to  benefit  Wilson  &  Moore, 
or  to  obtain  any  forbearance  for  thom,  but  to 
benefit  the  defendant  company."  So,  in  the 
present  case,  the  purpose  of  this  arrange- 
ment was  to  get  materials  to  carry  on  this 
work,  because  Dingman  could  not  purchase 
goods.  This  was  so,  not  only  with  regard  to 
the  plaintiff,  but  with  others  along  the  line 
of  the  road;  and  the  goods  were  delivered  to 
th.e  railroad  company's  camps,  and  there 
used.  It  was  to  benefit  the  company,  and 
not  to  benefit  Dingman,  or  to  obtain  any  for- 
bearance for  him.  This  rule  was  recognized 
in  Calkins  v.  Chandler,  3G  Mich.  320,  and  it 
was  there  said:  "But  where  the  third  party 
is  himself  to  receive  the  benefit  for  which  his 
promise  is  exchanged,  it  is  not  usually  ma- 
terial whether  the  original  debtor  remains 
liable  or  not."  This  case  was  cited  with  ap- 
proval in  Perkins  v.  Hershey,  77  Mich.  504, 
43  N.  W.  1021.  We  think,  therefore,  the 
principles  found  to  be  established  in  Hirsch- 
manu  v.  Railroad  Co.,  supra,  have  been  fully 
established  here,  and  under  the  findings  of 
the  jury  the  defendant  is  properly  held 
liable,  not  only  upon  the  verbal  arrangement 
made  by  Davis  with  C.  M.  Tm-ner  for  the 
plaintiff,  but  also  upon  the  written  guaranty 
of  Davis. 

Many  other  errors  are  assigned  upon  this 
record,  but  we  do  not  think  it  profitable  to 
discuss  them.  The  main  features  of  the 
case  involve  the  statement  of  many  facts. 
The  theory  of  both  parties  was  laid  before 
the  jury  in  a  full  and  fair  charge,  and  the 
jury  have  determined  the  issues  in  favor  of 
the  plaintiff.  Judgment  must  be  affirmed. 
The  other  justices  concurred. 


STATUTE  OF  FRAUDS. 


421 


HOBBS  y.  BRUSH  ELECTRIC  LIGHT  CO. 

(42  X.  W.  '.)(;.-),  75  Mich.  550.) 
Supreme   Court  of  Michigan.      June   28.    1S80. 

Error  to  circuit  court,  "Wayne  county; 
Rkilly,  Judjre. 

lleniii  M.  Cheexer  and  Mojitgomcry  c6  Jef- 
fries, for  Mppellant.  MursluUt  Cowles  &  Je- 
rome, for  appellee. 

CHAMPLIN,  J.  The  plaintiff  was  employed 
by  the  defendant  to  trim  its  lamps,  and,  while 
so  employed,  fell  from  a  jiole  to  the  ground, 
a  distance  of  25  feet,  and  was  severely  in- 
jured. He  alleges  that  the  accident  was 
caused  by  the  negligence  of  the  company  in 
not  providing  a  proper  guard  to  sustain  him 
while  in  the  act  of  cleaning  the  lamp.  This 
guard  was  a  loop  of  wire,  which  was  sus- 
pended from  the  top  of  the  lamp  frame,  and 
passed  aiound  under  his  arms,  and,  in  per- 
forming his  work  this  wire  was  required  to 
sustain  nearly  tlie  weight  of  his  body.  The 
defect  claimed  was  that  this  wire  was  too 
light,  and  lacked  the  requisite  strength.  He 
hat!  been  in  the  employment  of  the  comisany 
several  months  in  the  capacity  of  trimmer, 
and  had  trimmed  this  lamp,  and  knew  of  the 
unsafe  nature  and  condition  of  tins  guard  for 
a  long  time.  It  was  his  duty,  under  his  em- 
ployment, when  he  observed  any  defects  in 
the  appliances  or  api^aratus  in  use  by  the 
company  to  notify  it  promptly  of  such  defect. 
Tie  notified  the  head  trimmer  of  th' unsafe 
size  of  this  wiie  guard,  and  he  said  he  would 
have  it  attended  to,  but  it  was  not  done.  A 
few  days  before  tlie  accident  he  rei>orted  it  to 
one  of  the  line  men,  but  nothing  was  done. 
After  his  injury,  which  occurred  on  the  2d 
day  of  January,  he  was  taken  to  the  hospital, 
where  he  stayed  until  he  recovered  suflicient 
to  walk  out,  about  the  middle  of  March.  He 
went  to  work  again  for  the  company  about 
the  20th  of  March,  and  was  employed  in  the 
siiop  for  a  short  time,  repairing  Lanps  and 
cleaning  them,  when  he  was  set  at  work 
again  trimming  lamps.  While  he  was  at 
tt.e  hospital  the  company  continued  to  pay  to 
liis  wife  the  same  wages  he  received  while  at 
woik.  They  also  paid  his  hospital  bills. 
The  wages  and  bills  so  paid  amouidcd  to 
§1G2.50.  After  seven  or  eight  days  from  his 
injury  he  knew  that  his  wages  were  being 
paid  to  his  wife.  He  continsed  to  work  un- 
til the  latter  part  of  August,  when  he  took  a 
day  off  for  recreation.  When  he  appeared 
the  next  day  at  the  otlice  the  superintendent 
asked  him  if  lie  had  come  to  quit.  Ilerepiied 
"I  am  here,"  and  he  directed  Mr.  Welton  to 
l)ay  him  off,  and  he  did  so.  He  then  went 
and  saw  Mr.  Leggett,  the  president  of  the 
conii)anv,  and  he  advised  him  to  go  back  and 
talk  with  the  supeiintendent.  After  some 
talk  the  superintendent  told  him  to  come 
again  on  Monday.  At  this  time  he  told 
plain! i If  if  he  would  sign  an  agr.ement  to 
clear  the  company  froai  all  responsibility  he 
would  give  him  steady  emi)loyment  as  trim- 


mer. He  said  he  paid  him  l)is  wages  while 
he  was  sick,  and  his  liospital  expenses,  and 
plantiff  told  him  if  he  would  give  him  steady 
work  he  would  sign  it.  A  release  of  all  ac- 
tions, causes  of  action,  and  damages  was 
then  prepared  by  the  company,  and  plaintiff 
signed  it,  "because  lie  said  he  would  give 
me  steady  employment  at  the  same  wages 
that  I  had  been  liaving,  which  was  filteen 
shillings  a  day."  He  worked  until  the20tli  of 
Oclolier,  and  was  entitled  to  receive  .•?24.:j8. 

It  was  the  practice  of  the  company  to  in- 
close the  wages  due  their  emplpyi  s  in  an  en- 
vel()i)e,  with  the  amount  marked  on  tlie  out- 
side, and  at  tiie  time  tlie  envelo])e  was  deliv- 
ered the  employe  was  recjuired  to  sign  a  re- 
ceipt for  the  amount.  The  envelope  given 
to  the  [daintiff  was  marked  ."?24.o8,  but  on 
opening  it  he  found  it  contained  ."?20.;38,  and 
a  doctor's  bill  for  four  dollars.  A  d;spute 
thereupon  arose  whether  this  bill  of  expense 
w.is  included  in  the  amount  stated  in  the  re- 
lease, and  the  company  discharged  tlie  plain- 
tiff then  and  there.  The  jjlaintiff  then 
brouglit  this  action  to  recover  his  damages 
for  his  personal  injuries. 

Upon  the  trial  the  facts  appeared  as  stated 
above.  The  release,  bearing  date  the  lOtli 
day  of  September,  1888,  signed  and  sealed  by 
the  jdaintiff,  was  read  in  eviilence,  and  the 
court  directed  a  \'erdict  for  the  defendant  on 
the  ground  that  there  was  no  testimony  show- 
ing that  the  r-  lease  was  obtained  by  fraud, 
duress,  or  surprise.  We  agree  with  the  cir- 
cuit court  that  there  is  no  evidence  of  fraud, 
mistake,  surprise,  or  duress  b}-  which  the  re- 
lease was  executed  and  delivered,  nor  is  there 
any  conllict  of  evidence  as  to  the  considera- 
tion. The  plaintiffs  testimony  shows  the 
consideration,  and  it  was  a  good  and  sutli- 
cient  one  to  support  the  release.  The  seal 
imports  a  consideration,  and  \s  prima  facie 
evidence  of  it;  but  the  validity  of  the  instru- 
ment may  be  attacked  for  fraud,  mistake, 
surprise,  duress,  or  total  want  of  considera- 
tion. The  rule  created  by  statute  that  sealed 
instruments  may  be  impeached  for  want  of 
consideration  applies  with  equal  force  to  all 
sealed  instruments  between  party  and  party. 
Xow,it  is  claimed  by  counsel  for  the  plaintiff 
that  there  was  a  total  want  of  consideration, 
because  the  money  paid  for  wages  and  hos- 
pital expenses  by  the  company  were  entirely 
voluntary,  and  created  no  de'nt  or  obligation 
against  the  plaintiff  which  he  was  in  any 
wise  bound  to  repay,  and  the  promise  to  fur- 
nish steady  employment  was  void  by  the 
statute  of  f rautls  because  not  in  writing.  It 
will  be  noticed  that  the  agreementto  furnish 
steady  employment  did  not  specify  any  time 
during  which  it  should  be  furnisiied,  and  a 
verbal  promise,  based  upon  a  good  consider- 
ation, would  be  valid  for  one  year  at  least. 
Grant  that  the  payment  of  wages  and  hos- 
pital exjienses  were,  in  the  lirst  instance, 
voluntary,  and  could  not  have  been  recov- 
ei-fd  by  action,  yet  there  was  a  consideration 
for  the  release  in  taking  the  plaintiff,  who 
had   been  discharged,  back  into  the  employ- 


422 


STATUTE  OF  FRAUDS. 


ment  of  the  company  at  fixed  wages  and  the 
promise  of  steady  employment.  Tliis  agree- 
ment was  le<;al  and  binding,  and,  if  the 
jjlaintifT  was  discliaiged  without  causo,  as  lie 
appears  upon  this  record  to  have  been,  his 
remedy  is  upon  tlie  agreement.  In  order  to 
obtain  employment  by  tliis  company  he 
agreed  to  and  did  release  his  cause  of  action 


for  damages,  and  the  company,  in  consider- 
ation of  such  release,  did  lake  him  again  in- 
to its  service,  and  promise  him  steady  em- 
ployment at  the  wages  previously  paid  to  him. 
The  settlement  appears  to  have  been  satis- 
factory to  both  parties,  and'nothing  is  shown 
to  impeach  its  validity.  The  judgment  is 
affirmed.     The  other  justices  concurred. 


STATUTE  OF   FliAI'DS. 


423 


HAKIMS  riioTOGRAriric  surpiA'  co. 

V.  FISHKU. 

(45  N.  W.  OGl,  81  Mioh.  130.) 

Supreme  Court  of  Michigan.     June  0,  ]S'K). 

Error  to  circuit  court,  AVayiio  county. 
Corliss,  Ariflnis  &  Leota,  for  apijeilaiit. 
ChurJes  Flowers,  for  appellee. 

LOX(r,  J.  Pl:iintiff  is  a  cor|ior;ition  or- 
p,nni7,e(l  and  existing::  under  tlie  laws  of 
tliis  state,  and  doing  business  in  Detroit. 
This  action  is  brought  in  Hssninjtsit  to  re- 
cover the  price  and  value  of  eertain  i)er- 
sonal  property  claimed  to  have  been  ex- 
changed to  defendant  fur  real  estate.  The 
contract  set  out  in  the  declaration  is  that 
on  July  23,  ISSS,  the  ])laintiff  sold  to  de- 
fendant, and  the  defendant  bought  of 
plaintiff  a  photograi)hic  jrallery,  includin,i? 
the  stock,  fixtures,  furniture,  nejjcatives, 
and  everything'  connected  therewith,  and 
used  in  connection  with  the  carryinj?  on 
of  the  business  of  i)hotographin<>-  in  De- 
troit; and  in  consideration  of  such  pur- 
chase and  sale  the  defendant  agreed  to 
transfer  to  the  plaintiff  certain  real  estate 
situate  in  Ba^^  City,  Mich.,  of  the  value  of 
$1,()U();  and  the  plaintiff  on  the  day  last 
aforesaid  delivered  to  the  defendant  the 
possession  of  said  gallery,  and  the  fixtures 
and  appurtenances  connected  therewith, 
and  the  defendant  took  possession  of  the 
same;  yet  the  defendant  has  neglected  and 
refused  to  transfer  the  said  projierty  so  as 
agreed  to  be  ti-ansferred  in  payment  for 
said  i)hotographic  gallery,  although  often 
requested  so  to  do;  whereby  the  said  de- 
fendant has  become  liable  to  pay  to  the 
said  plaintiff  thesumc>f  fl,()()Uand  interest, 
and  in  consideration  of  the  premises  then 
and  there  promised  the  plaintiff  to  i)ay  it, 
etc.  The  common  counts  are  also  added. 
The  plea  was  the  general  issue,  and  there- 
under defendant  gave  notice  of  several 
matters  of  defense,  and,  among  others — 
First,  that  no  agreement  in  writing  was 
entered  into  between  the  parties;  second, 
that  there  was  no  delivery  of  possession 
of  goods  and  property,  and  that  the  de- 
fendant only  tt)ok  the  keys  of  tiie  gallery 
to  make  an  examination  and  inventory  of 
the  property,  and  upon  such  examination 
and  inventory,  finding  the  rei)resentations 
of  the  plaintiff  in  reference  to  such  proper- 
ty untrue,  defendant  returned  the  keys  to 
the  plaintiff;  tliird,  that  no  possession  or 
right  of  possession  was  ever  delivered  or 
secured  to  the  defendant;  fourtli,  that  de- 
fendant never  promised  or  agreed  to  pav 
to  plaintiff  the  sum  of  $1,(100 ;  fiYf/j,  that 
the  contract  for  the  exchange  of  lands  as 
alleged  in  the  declaration  was  void  under 
the  provisions  of  section  GlSl,  How.  St.. 
the  same  not  being  alleged  to  have  been  in 
writing;  sixtli,  that  the  claimed  sale  of 
goods,  being  for  the  price  of  $50  or  more, 
is  void,  under  the  provisions  of  section 
(51S6,  How.  St.,  the  purchaser  not  having 
accepted  or  received  any  of  the  goods,  or 
given  anything  in  earnest  to  bind  the  bar- 
gain in  part  payment,  and  there  being  no 
note  or  memorandum  in  w>riting  of  the 
^largain  made,  signed  by  either  of  the  par- 
ties. The  cause  was  ti-ied  in  the  circuit 
court  before  a  jury,  who  found  a  verdict  in 


favor  of  the  i)lainliff.  Defendant  brings 
error. 

It  appears  *hat,  at  the  commencement 
of  the  trial,  defenibnit's  counsel  olt;ected 
"to  any  evidence  being  received  under  the 
deglaration,  for  the  reason  lliat  it  does 
not  alieg(!  a  sullicieut  cause  of  action  to 
enal)le  liie  plaintiff  to  recover;  that  tlie 
declaration  does  not  contain  an  allega- 
tion sullicient  to  take  the  case  out  of  the 
statute  of  frauds;  and  does  not  allege 
that  defendant  retained  possession  of  the 
gallery,  and  converted  it  to  iiis  own  use." 
The  objection  was  overruled,  and  the 
cause  proceeded  to  trisil.  The  co\]rt  very 
properly  overruled  tiiis  objection.  The 
declai-ation  need  not  set  out  that  the 
promise  in  relation  to  real  estate  was  in 
writing,  or  that  there  was  part  delivery 
of  the  property,  or  anything  paid  in  ear- 
nest on  the  purchase  of  the  personalty. 
This  is  matter  of  proof,  and  may  be  shown 
on  the  trial.  The  declaration  set  out  a 
cause  of  action.  lolting  v.  Vanderlyn,  4 
Johns.  237;  Dayton  v.  Williams,  2  Doug. 
(Mich.)  31. 

The  case  was  submitted  to  tlie  jui\y  upon 
the  question  of  delivery  to  the  defendant 
of  the  personal  property  sued  for,  and 
they  have  found  the  fact  in  favor  of  the 
plaintiff,  and  we  cannot  disturb  that  ques- 
tion, if  tliere  was  any  competent  evidence 
to  sustain  the  finding.  Taking  the  whole 
evidence  introduced  by  the  plaintiff,  we 
are  satisfied  that  there  was  some  evidence 
upon  which  the  jury  could  very  properly 
say  that  the  property  was  aliened  to  the 
defendant,  and  was  acceijted  under  the 
contract.  It  appears  that  the  defendant 
owned  the  building  in  wiiich  the  gallery 
was  situate,  and  rented  it  to  the  plaintiff. 
The  business  of  the  gallery  was  being  car- 
ried on  for  the  plaintiff  by  Mr.  Friend.  He 
states  that  the  defendant  talked  with  him 
about  exchanging  some  real  estate  in  Bay 
City  for  tlie  gallery,  and  wanted  him  to 
see  Mr.  Harris,  the  president  of  the  plain- 
tiff company,  and  learn  if  such  an  exchange 
could  be  made;  that  he  told  defendant  tlie 
gallery  was  worth  from  $1,400  to  $1,()00, 
and  he  would  see  Mr.  Harris  about  the 
exchange;  that  he  saw  Mr.  Harris,  and, 
the  parties  having  afterwards  met,  tlie 
witness,  being  present,  said  to  Mr.  Har- 
ris: "Here  is  Mr.  Fisher,  and  you  gentle- 
men better  settle  the  question  about  the 
gallery  a!id  the  real  estate."  That  Mr. 
Harris  said:  "  Mr.  1  isher,  you  make  out 
the  deed,  and  we  will  finish  this  up  at 
once;"  when  Mr.  Fisher  said  :  "There  is 
another  room  there  somewhere. — the  bro- 
mide room,  they  call  it,— and  I  want  to  go 
and  see  what  is  in  there."  The  witness 
then  says:  "They  gave  me  the  keys,  and 
Ave  went  together,  and  saw  what  was  in 
there.  I  did  not  know  what  was  in  there 
before,  and  my  estimate  did  not  include 
that.  I  left  Mr.  Fisher  tliere.  and  went 
home."  Mr.  Harris,  the  T>«'si(lt'nt  of  the 
plaintiff  coiui)any,  gave  his  version  of  the 
affair,  as  follows:  "Mr.  Friend  made  the 
remark  :  'Now.  you  two  gentlemen  settle 
this  business  up.'  So  Mr.  Fisher  and  I 
stepped  to  the  front  part  of  the  store,  and 
talked  over  the  matter  for  a  moment  or 
two.  and  he  agi-eed  to  give  me  a  deed  of 
certain   property    in    Bay  City.  va'.u.Ml    at 


424 


STATT'TE   OF  Fit  AT  I  )S. 


$1,675.  He  was  to  nuikc  his  deed  tlic  Tioxt 
day,  and  we  were  to  make  a  l)ill  of  sale. 
That  was  the  eonversation.  I  had  never 
met  Mr.  Fislier  prioi-  to  tliis  in  i-(><iar<l  to 
it.  Mr.  Fisher  incpiired  if  thei'e  was  any 
other  propei'ty  hesities  what  there  wan  in 
the  jiiiUery.  1  said  tiiat  there  was  one 
camera  l)ox,  2()xl'4,  tiiat  was  in  Mr. 
Friend's  <iallei*y  temporarily,  and  there 
were  l)romi(h>  rooni.s  on  (irand  River  Ave., 
and  he  said  if  he  hoii.nlit  it  he  wanted  the 
bromide  rooms  transferred  to  the  j^allery. 
I  said,  'That's  satisfactory;'  we  would 
transfer  the  bromide  rooms  at  our  ex- 
])eiise.  and  put  ail  inside  the  {gallery  on 
"Woodwai'd  avenue.  Mr.  Fisher  said  he 
wonld  ji:ive  me  a  deed  of  this  pro]>erty  in 
Hay  City,  and  we  were  to  }s;i\'e  him  a  bill 
of  sale,  and  the  transaction  was  closed  in 
lliis  manner,  I  aavo  him  tlie  keys  to  go 
and  look  at  the  bromide  room.  He  came 
back,  and  said  he  wanted  the  stuff  in  tlie 
bromide  room  S(Mit  i-i;.viit  over  that  day. 
AN'eliien  went  and  put  evei-ythini^  from  the 
i)romi(h'  room  in  tlie  gallery.  Tlie  key  to 
the  g-aHery  was  in  possession  of  Mrs. 
Friend.  Mr.  Fisher  said  he  wanted  the 
key,  and  the  ajj^ieement  was,  if  he  bought 
the  gallery,  Mrs.  Friend  was  to  deliver  the 
key  to  him.  The  next  day  Mr.  Fisher  came 
in.  and  wanted  to  know  how  the  deed 
should  •  he  made  out.  He  said  our  institu- 
lion  was  a  corporated  company,  and,  if 
the  deed  was  made  out  to  the  corpora- 
tion, it  would  recjuire  tiie  signatures  of 
the  wives  of  all  the  stockhohlers,  and  he 
would  like  to  know  whether  it  should  be 
made  to  the  corporation  or  to  me.  1  told 
him  I  would  let  him  know  in  the  after- 
noon. He  came  in  again  in  the  afternoon, 
and  I  told  him  he  could  make  the  deed  to 
nie  pers(3nally.  I  saw  him  again  within  a 
day  ortwo.  He  came  in  with  the  deed  all 
made  out.  with  the  exce))tioii  of  the  signa- 
ture, as  I  understood  it  at  the  time,  of  his 
son's  wife.  Instead  of  the  property  being 
in  his  own  name, it  was  in  his  son's  name. 
He  said  he  would  go  out  and  get  the  sig- 
nature, and  transfer  it  t(3nie  the  next  day. 
I  did  not  see  Mr.  Fisher  again  for  quite 
a  while.  He  did  not  pay  any  attention  to 
our  re(iuest  forthedeed.  Aboutfourorfive 
weeks  after  the  transaction  a  gentleman 
brought  me  a  sealed  envelope,  and  inside 
was  the  key.  I  retuiJied  the  key  to  him 
through  the  mail.  I  never  saw  Mr.  Fisher 
again  until  in  court.  Some  days  after  this 
bargain  Mr.  Fisher  came  into  the  store, 
and  wanted  meto  get  an  opeiatorfor  him. 
He  said  he  understood  Mr.  Friend  could 
not  work  for  him,  and  he  wanted  an  op- 
erator to  run  the  gallery  for  him.  I  after- 
wards told  .Mr.  Fisher  I  had  written  to  an 
operator,  and  got  a  reply  that  he  would 
be  in  on  Monday.  " 

It  appears  that  this  first  conversation 
between  thw  parties  took  place  on  July  23, 
18SS.  Mr.  Harris  also  testified  that  he 
never  gave  the  bill  of  sale,  and  never  re- 
ceived any  deed.  After  the  key  was  re- 
turned..Mr.  Msher  commenced  suit  against 
the  ijlaintiff  for  the  collection  of  the  rent 
of  the  building.  Plaintiff  also  gave  evi- 
dence tending  to  show  that  the  defendant 
stated  to  a  Mrs.  Nellie  Goodwill  that  he 
had  traded  some  projjertj-  in  Saginaw  for 
the   galleiy,  and  that  he    moved  a  couch 


from  the  gallei-y  to  his  own  rooms  in  the 
same  building,  and  then  returned  it  to 
the  gallery,  and  asked  Mrs.  Goodwill  not 
to  say  anything  about  it,  because  he  had 
concluded  not  to  buy  the  gallery  if  he 
could  get  out  of  it.  Plaintiff  also  gave 
evidence  tending  to  sliow  that  defendant 
called  upon  Mrs.  Friend,  and  got  the  key 
to  the  gallery,  and  told  her  he  had  bought 
it.  Substantially  this  is  the  claim  of  the 
plaintiff.  Dcfeiniant  insists  that  the  con- 
tract was  not  completed;  that  he  only 
took  the  key  to  examine  the  property  in 
the  gallery,  and,  having  made  an  exam- 
ination and  i)rocured  an  inventory  to  be 
made  by  a  Mr.  Kier,  who  was  familiar 
with  such  property,  he  ascertained  the 
property  was  only  woj-th  .f(n4.b"),  and  was 
not  of  the  value  of  iif;l,400  to  .fl, «<)(),  as  rep- 
resented by  Mr.  Friend:  that, finding  upon 
such  exan>ination  how  little  the  pi-operty 
was  worth,  he  returned  the  key,  and  re- 
fused to  complete  the  contract.  Thecourt 
submitted  the  facts  vei-y  fairly  to  the  jury 
upon  the  respective  claims  of  the  parties, 
as  follows:  "And  it  is  claimed  by  '\Ir. 
Fishei-  that  he  did  not  accept  these  goods; 
that  there  was  no  acceptance  on  his  part; 
that  he  merely  took  the  key  for  the  pur- 
pose of  taking  an  inventory.  If  that  is  the 
fact,  that  would  be  an  end  to  the  case.  If 
you  determine  that  to  be  the  fact;  that 
there  was  no  acceptance  on  his  part;  that 
he  did  not  enter  into  possession  of  them  ; 
that  he  merely  received  the  key  for  the 
purpose  of  taking  an  inventory, — that 
would  be  an  end  to  this  case,  and  j'our 
verdict  would  be  for  the  defendant.  "  It  is 
conceded  that  the  contract  for  the  ex- 
change of  the  real  estate  is  void,  because 
not  in  writing.  It  is  also  conceded  that 
thecontract  for  the  exchange  of  the  goods 
is  void,  not  being  in  writing,  and  the  value 
being  above  $'>(),  and  no  part  of  the  pur- 
chase price  paid,  unless  there  has  been  a 
delivery  of  the  whole  or  a  part  of  the 
goods  and  an  acce])tance.  It  is  clearly 
settled  that  both  acceptance  and  actual 
receipt  are  necessary,  and  the  l)urden  of 
proving  them  rests  upon  the  person  try- 
ing to  set  up  the  contract.  They  are  both 
facts,  and  the  circumstances  which  go  to 
make  up  acceptance  and  a(;tual  receijit  are 
for  the  jury.  S  Amer.  &  Eng.  Cyclop.  Law, 
730.  Had  the  action  been  l)rought  in  this 
case  by  the  plaintiff  to  recover  tlie  posses- 
sion of  the  goods,  upon  a  refusal  of  the  de- 
fendant to  deliver  up  the  key  to  the  build- 
ing or  the  gofxls,  plainlj-it  must  have  been 
held,  under  the  finding  of  the  jury,  that 
there  was  evidence  of  such  delivery  over, 
.and  accejitance  by  the  defendant,  as  to 
pass  title  absolutely  to  him.  The  learned 
counsel  for  defendant  says,  in  his  brief, 
that  "this  was  a  suit  ujion  an  executory 
verbal  contract,  not  performed  on  either 
side."  If  this  was  so,  then  no  recovery 
cotild  have  been  had.  But  the  claim  of 
plaintiff  is  that  there  was  part  jierform- 
ance;  that  there  was  a  delivery  of  goods 
to  the  de  endant,  which  he  accepted, — and 
the  jury,  under  a  fair  submission,  have 
found  tiiat  to  be  so.  This  would  take  the 
case  out  of  the  statute  of  frauds.  It  is 
true  that,  under  the  first  arrangement,  a 
bill  of  sale  was  to  be  made  to  the  goods, 
aiul    a   deed  of  real  estate  to  be   executed 


STATUTE  OF  FRAUDS. 


425- 


and  flelivered.  But  the  title  to  the  goods 
wouhl  pass  without  the  bill  of  sale,  if  there 
was  a  sufficient  delivery  and  an  accept- 
ance. Counsel  seeks  to  bring  the  case 
within  the  rulings  of  this  court  in  Sheley 
V.  Whitman,  67  Mich.  397,  34  N.  W.  Rep. 
879  In  that  case,  however,  there  was  no 
pretense  of  a  delivery  of  any  part  of  the 
goods,  which  were  of  the  value  of  $200.    It 


was  said  in  that  case  that  the  purchaser 
never  accepted  or  received  any  article,  and 
never  paid  anything,  and  that  the  letter,, 
which  was  the  only  writing,  did  not  show 
what  the  contract  was.  In  tlie  present 
case  there  was  not  only  a  delivery,  but  an 
acceptance.  We  see  no  error  in  the  record. 
The  judgment  must  be  affirmed,  with, 
costs.    The  other  justices  concurred. 


42G 


STATUTE  OF  FRAUDS. 


HATCH  V.  .MdUHEN. 

(47  X.  W.  214,  S3  Mich.  159.) 

Supreme  Court  of  Michigan.    Nov.  14,  1890. 

Error  to  circuit  court,  Keut  county;  Wil- 
liam E.  Grove,  Judjre. 

Fitziierakl  &  Barry,  for  appellant.  Fletch- 
er tfc  Waiity,  for  appellee. 

CAHH^L,  J.  This  case  was  commenced  in 
justice  court,  where  the  plaintiff  filed  the  fol- 
lowinj;  written  declaration:  "Now  comes  the 
said  plaintiff,  and  complains  of  the  said  de- 
fendant, who  has  been  summoned  to  answer 
the  plaintiff  in  a  plea  of  trespass  on  the  case 
on  promises,  for  that  heretofore,  to-wit,  on  the 
1st  day  of  April,  1889.  the  said  plaintiff,  at 
the  special  instance  and  request  of  defendant, 
and  as  the  agent  and  broker  of  defendant,  i 
purchased  for  the  account  of  defendant  a 
large  quantity  of  canned  goods,  to-wit,  200 
dozen  of  tomatoes,  and  200  dozen  of  corn,  and 
caused  the  said  goods  to  be  brought  to  the 
city  of  Grand  Rapids,  ready  to  be  delivered 
to  said  defendant;  that,  afterwards,  and  on, 
to-wit,  the  day  and  year  last  mentioned,  plain- 
tiff notified  defendant  of  the  receipt  of  said 
goods,  and  requested  him  to  receive  them,  and 
take  them  away.  The  defendant  utterly  re- 
fused to  receive  said  goods  as  he  had  agreed. 
and  has  always  refused  and  neglected  so  to 
do;  that  plaintiff,  by  reason  of  such  neglect 
and  refusal  on  the  part  of  the  defendant,  was 
compelled  to  and  did,  on,  to-wit,  the  Isl  day 
of  April.  1889,  sell  the  said  goods  on  ac<;ount 
of,  and  for  the  use  of,  said  defendant,  to  the 
best  advantage,  and  for  the  best  prices,  he 
could  obtain  for  the  same;  that  by  reason  of 
a  declining  market,  and  of  the  depreciation  in 
value  of  said  goods,  plaintiff  suffered  great 
loss  and  damage  in  the  handling  and  sale  of 
said  goods,  to-wit,  three  hundred  dollars. 
Therefore  he  brings  suit.  Plaintiff  also  de- 
clares on  all  the  common  counts  in  assumpsit 
to  his  damages  .1^300  or  under."  The  plea  was 
the  general  issue.  Plaiutiff  recovered  a  judg- 
ment in  the  justice  court,  and  the  defendant 
a])i)ealed  to  the  circuit,  where  the  case  was 
tried  before  Hon.  William  E.  Grove,  the  cir- 
cuit judge,  without  a  jury.  On  the  trial  in 
the  circuit  court,  the  plaintiff  asked  leave,  and 
was  allowed,  to  amend  his  declaration  by 
striking  out  of  it,  in  the  eighth  and  ninth  lines, 
the  words,  "and  as  the  agent  and  broker  of 
said  defendant."  The  court  made  a  written 
finding  of  fact  substantially  as  follows:  Flain- 
tlff  was  a  retail  grocer,  and  the  defendant  a 
commercial  broker,  both  doing  business  in 
Grand  Rapids.  In  1S8T,  when  the  plaintiff' 
was  placint,'  his  order  for  canned  corn  and 
tomatoes,  the  defendant  requested  the  plain- 
tiff to  include  in  his  order  100  cases  each  of 
corn  and  tomatoes  for  the  defendant.  This 
was  done,  and  defendant  received  the  goods, 
paying  tlie  actual  cost  of  them  at  Grand  Rap- 
ids, when  delivered  When  it  came  time  to 
place  orders  for  the.se  goods  in  1888,  and  on 


the  20th  of  February,  1888,  the  defendant 
again  requested  the  plaintiff  to  include  in  his 
order  100  cases  each  of  Red  Seal  corn  at  87l^ 
cents  per  dozen,  and  Lowenkamp  tomatoes  at 
921/^  cents  per  dozen,  each  case  containing  two 
dozen  cans,  the  defendant  agreeing  to  receive 
the  goods  on  delivery,  and  pay  for  them  at  the 
above  prices.  Tlie  plaintiff"  complied  with  this 
request,  and  ordered  the  goods  from  Thomas, 
Roberts  &  Co.,  of  Thiladelphia.  On  the  11th 
of  October,  1888,  the  plaintiff  received  from 
Thomas,  Roberts  &  Co.  the  tomatoes  ordered, 
including  the  100  cases  ordered  for  tlie  defend- 
ant, and  on  the  29th  of  Octol)er.  1888,  he  re- 
ceived the  corn  ordered,  including  the  100 
cases  for  the  defendant,  of  wliich  the  defend- 
ant had  immediate  notice.  Diu'iug  the  sum- 
mer of  18.S'8.  the  prices  on  such  goods  depre- 
ciated, and  the  plaintiff,  at  the  request  of  the 
defendant,  negotiated  with  Thomas,  Roberts 
&  Co.,  and  obtained  a  reduction  of  prices 
from  those  made  in  tlie  contract  to  85  cents 
per  dozen  for  both  corn  and  tomatoes,  and 
the  brand  of  tomatoes  was  changed  to  Red 
Seal.  Wlien  the  goods  arrived,  it  appeared 
tliat  the  tomatoes  were  of  tlie  kind  originally 
ordered,  that  is,  the  Lowenkamp;  but  it  does 
not  appear  that  any  fault  was  found  by  the 
defendant  with  this  change.  The  defendant 
requested  tlie  plaintiff  to  deliver  the  goods 
to  him.  but  the  plaintiff  refused,  unless  the 
defendant  would  pa.y  for  them,  which  defend- 
ant did  not  offer  to  do.  The  plaintiff,  in  pur- 
chasing the  goods  from  Thomas,  Roberts  & 
Co.,  obtained  them  on  the  following  terms: 
"Notes  payable  60  days  from  date  of  ship- 
ment, or  one-half  cash  in  7  days."  Defendant 
refused  to  receive  the  goods  and  pay  for  them 
on  delivery.  It  does  not  appear  from  the 
finding  whether  he  offered  to  talce  them  on 
the  terms  on  which  they  were  sold  to  plaintiff 
or  not.  The  plaintiff  paid  Thomas,  Roberts 
&  Co.  for  the  goods  at  the  contract  price. 
After  the  refusal  of  the  defendant  to  accept 
the  goods  and  pay  for  tliem,  the  plaintiff  sold 
85  cases  at  the  best  prices  he  could  obtain 
for  them,  sustaining  a  loss  thereon  of  $17.  Up 
to  the  time  of  the  commencement  of  this  suit, 
the  plaintiff  has  been  unable  to  dispose  of  the 
canned  corn.  The  court  finds  that  the  cor'i 
was  worth,  at  the  time  of  the  commencement 
of  the  suit,  5714  cent.^  per  dozen,  and  that  the 
plaintiff's  loss  sustained  on  the  corn  was  .$55, 
that  being  the  difference  between  the  price 
paid  and  the  market  price  at  the  time  of  the 
commencement  of  the  suit.  By  agreement  of 
the  parties,  defendant  was  to  pay  his  propor- 
tionate share  of  the  freight  from  Philadel- 
phia to  Grand  Rapids,  which  the  court  found 
to  have  been  $20.05.  It  also  appears  from 
the  finding  tliat  the  agreement  between  the 
parties  was  a  verbal  one,  and  that  no  note  or 
memorandum  of  the  bargain  was  ever  made 
or  signed  by  the  defendant,  or  any  person 
thereunto  authorized  by  him.  For  these  vari- 
ous sums,  together  with  interest  from  the  time 
when  plaintiff  paid  for  the  goods  to  the  com- 
mencement of  suit,  the  court  found  the  plain- 


STATUTE  OF  FRAUDS. 


427 


tiff  entitleil  to  a  judi^ment.  Exception  was 
taken  to  this  jud.i^ment  that  the  facts  found 
did  not  support  it. 

It  is  said— First,  that  the  contract  was  for 
the  sale  of  personal  property  exceeding  in 
value  $50,  and  that  it  was  therefore  void,  un- 
der the  statute  of  frauds.  But  we  do  not 
think  the  facts  found  make  a  case  of  bargain 
and  sale,  but  rather  one  of  agency.  I'laintiff 
did  not  agree  to  sell  the  defendant  the  goods 
in  question,  but  his  contract  was  to  order  for 
him  of  Thomas,  Roberts  &  Co.  If  Thomas, 
Roberts  &  Co.  had  refused  to  furnish  the 
goods,  the  ijlaiutilf  would  have  been  in  no 
way  responsible  to  the  defendant  as  for  goods 
bargained  and  sold,  even  if  the  agreement  be- 
tween the  plaintiff  and  defendant  had  been 
in  writing.  This  was  evidently  the  view  tak- 
en of  the  transactions  by  the  circuit  judge, 
and  we  agree  with  him. 

Second.  It  is  said  that,  considering  the  con- 
tract to  have  been  one  of  agency  and  not  of 
bargain  and  sale,  the  defendant  was  entitled 
to  the  goods  on  the  same  terms  of  payment  as 
the  plaintiff  obtained  them  from  Thomas,  Rob- 
erts &  Co.,  that  is,  60  days.  Whether  this  is 
correct  as  a  matter  of  law  or  not  need  not  be 
discussed,  because  it  does  not  appear  that  the 
defendant  offered  to  take  the  goods  on  such 


terms,  or  that  he  claimed  the  right  to  any 
such  credit.  The  finding  is  that,  in  1887,  the 
defendant  ordered  goods,  and  paid  for  them 
on  delivery;  that,  in  1888,  defendant  asked 
the  plaintiff  to  order  goo<ls  for  him  the  same 
as  the  j'ear  before,  which,  we  think,  would  in- 
clude the  payment  for  the  goods  as  before  on 
delivery. 

Tliird.  There  is  nothing  in  the  point  that 
the  tomatoes,  when  received,  were  of  the  Low- 
enkamp  variety,  as  at  first  ordered,  instead  of 
Red  Seal,  as  put  into  the  amended  order.  The 
defendant  did  not  put  his  refusal  to  take  the 
goods  on  that  ground.  It  does  not  appear 
whether  the  variety  known  as  "Red  Seal" 
was  more  or  less  valuable  than  the  Lowen- 
kamp,  except  that  when  the  change  was  made 
in  the  order  from  Lowenkamp  to  Red  Seal 
the  price  was  reduced  from  921/1  cents  to  85 
cents,  indicating  that  the  Red  Seal  may  have 
been  of  a  cheaper  variety  than  the  Lowen- 
kamp. If  so,  the  defendant  could  not  com- 
plain that  he  was  furnished  with  a  better 
variety.  AVe  think  the  facts  found  by  the  cir- 
cuit judge  support  the  judgment,  and  it  will 
be  affirmed  with  costs. 

LONG,  J.,  did  not  sit.  The  other  justices 
concurred. 


428 


STATUTE   OF  FRAUDS. 


SAl<^FORD  ot  al.  v.  INlcDONOUUH. 

(120   Mass.    290.) 

Supreme  .ludieial  Court  of  Massachusetts.     Suf- 
folk.   May  0,  1S7G. 

T.  H.  Swoetser  and  B.  F.  IIay(>s,  for  plain- 
tiffs.     S.  A.  B.  Abbott,  for  defendant. 

MOKTOX,  .J.  This  is  an  action  of  contract 
to  recover  the  price  of  a  quantity  of  leath- 
er, exceeding:  fifty  dollars  in  value,  alleged 
to  have  been  sold  by  the  plaintiffs  to  the  de- 
fendant. There  was  no  memorandum  in 
writluf:  of  the  contract,  and  the  purchaser 
did  not  sive  anything  in  earnest  to  bind  the 
bargain  or  in  part  payment. 

It  api)eared  on  the  trial  that  the  defend- 
ant on  May  17,  1872,  went  to  the  plaintiffs' 
store  and  agreed  to  purchase  the  leather  at 
the  price  named,  to  be  paid  for  by  a  satis- 
factory note. 

On  the  thirty-first  day  of  the  same  month, 
he  again  went  to  the  plaintiffs'  store,  ex- 
amined the  leather,  had  it  weighed,  marked 
with  the  initials  of  bis  name,  and  piled  up 
by  itself,  to  be  taken  away  by  him  upon  giv- 
ing a  satisfactory  note  for  the  price,  or  the 
paj-meut  of  the  price  in  money,  but  not 
otherwise.  He  never  complied  with  the 
terms  of  the  agreement.  The  plaintiffs  re- 
ftised  to  allow  him  to  take  the  leather  from 
their  store  without  such  compliance,  claim- 
ing a  lien  upon  it  for  the  price  due.  It  re- 
mained in  their  store  till  November  9,  1872, 
when  it  was  burnt  with  the  store.  Upon 
this  evidence  the  presiding  justice  of  the  su- 
perior court  iiiied  that  the  leather  had  not 
been  so  accepted  and  receiv»jd  by  the  defend- 
ant as  to  take  the  contract  out  of  the  stat- 
ute of  frauds,  and  the  plaintiff"  excepted  to 
such  ruling. 

It  should  be  kept  in  mind  that  the  ques- 
tion is  not  whether,  if  a  valid  contract  of 
siile  upon  the  terms  above  named  had  been 
proved,  the  title  in  the  propeity  would  have 
passed  to  the  defendant,  so  that  it  would  be 
at  his  risk.  In  such  a  case,  the  title  would 
pass  to  the  purchaser  unless  there  was  some 
agreement  to  the  contrary,  but  the  vendor 
would  have  a  lieu  for  the  price,  and  could  re- 
tain possession  until  its  payment.  Haskins 
V.  Warren,  115  Mass.  514;  Morse  v.  Sher- 
man, 106  Mass.  430;  Townsend  v.  Har- 
graves,  118  Mass.  325.     But  the  question  is 


whether  the  defendant  had  accepted  and  re- 
ceived the  goods,  so  as  to  take  the  case  out 
of  the  statute  of  frauds,  and  thus  complete 
and  make  valid  the  oral  contract  relied  on. 
Unless  there  was  such  acceptance  and  receipt, 
there  was  no  valid  contract  by  virtue  of 
which  the  title  to  the  goods  would  pass  to 
the  defendant.  To  constitute  this,  there 
must  be  a  delivery  by  the  seller,  and  some 
unequivocal  acts  of  ownership  or  control  of 
the  goods  on  the  part  of  the  purchaser. 
Knight  V.  Mann,  118  Mass.  143,  and  cases 
cited. 

In  the  case  at  bar,  there  was  no  actual 
acceptance  and  receipt  of  the  goods  by  the 
defendant.  They  were  never  in  his  posses- 
sion or  control,  but  remained  in  the  posses- 
sion and  control  of  the  plaintiffs,  who  refused 
to  allow  him  to«take  them,  claiming  a  lieu 
for  the  price.  If  they  had  and  asserted  a 
lien  as  vendors,  this  is  inconsistent  with  the 
delivery  of  possession  and  control,  necessary 
to  constitute  an  acceptance  and  receipt  by 
the  vendee.  In  Baldey  v.  Parker,  2  B.  &  C. 
37,  44,  Ilolroyd,  .J.,  says:  "Upon  a  sale  of  spe- 
cific goods  for  a  specific  price,  by  partiug 
with  the  possession  the  seller  parts  with  his 
lieu.  The  statute  contemplates  such  a  part- 
ing with  the  possession,  and  'therefore,  as 
long  as  the  seller  preserves  his  control  over 
the  goods,  so  as  to  retain  his  lien,  he  pre- 
vents the  vendee  from  accepting  and  receiv- 
ing them  as  his  own  within  the  meaning  of 
the  statute."  Benjamin  on  Sales,  (Am.  Ed.) 
151,  and  cases  cited;  Browne,  St.  Fraud,  §  317, 

It  is  true  there  may  be  cases  in  whicli  the 
goods  remain  in  the  possession  of  the  vendor, 
and  yet  may  have  been  accepted  and  receiv- 
etl  by  the  vendee.  But  in  such  cases  the 
vendor  holds  possession  of  the  gootls,  not  by 
virtue  of  his  lien  as  vendor,  but  imder  somr, 
new  contract  by  which  the  relations  of  tht 
parties  are  changed.  Cusack  v.  Robinson,. 
1  B.  &  S.  299.  308;  Castle  v.  Sworder,  G  H. 
&  N.  828;   Uodsley  v.  Varley,  12  A.  &  E.  (i32. 

In  the  case  at  bar,  the  vendors  refused  to 
permit  the  vendee  to  take  possession  or  con- 
trol of  the  goods,  but  claimed  and  asserted 
their  lien  as  vendoi's  for  the  price.  We  are 
therefore  of  opinion  that  the  ruling  of  the 
superior  court  was  correct. 

Exceptions  overruled. 

ENDICOTT  and  LORD,  J.T.,  absent. 


STATUTE  OF  FRAUDS. 


429 


BUTJ.Eli  V.  THUMSOX  ot  al. 

(92  U.  S.  412.) 

Supreme  Cnuit  of  the  United  States.    Oct. 
Term,   1875. 

Error  to  the  circuit  court  of  the  Uuited 
States  fcr  the  Southern  district  of  New 
York. 

Mr.  AVilliam  M.  PJvarts  for  the  plaiulil'f 
in  error.     Mr.  E.  H.  Owen,  contra. 

Mr.  Justice  HL'XT  delivered  the  opinion  of 
the  court. 

The  plaintiff  alle^^red  that  on  the  eleventh 
day  of  July,  IStJT,  he  bargained  and  sold  to 
the  defendants  a  quantity  of  iron  thereafter 
to  arrive,  at  prices  named,  and  that  the  de- 
fendants agreed  to  accept  the  same,  and  pay 
the  purchase-money  therefor;  tliat  the  iron 
arrived  in  due  time,  and  was  tendered  to 
the  defendants,  who  refused  to  receive  and 
pay  for  the  same;  and  that  the  plaintiff  aft- 
erwards sold  the  same  at  a  loss  of  .?G,.jS1, 
which  sum  he  requires  the  defendants  to 
make  good  to  him.  The  defendants  inter- 
posed a  general  denial. 

Upon  the  trial,  the  case  came  down  to  this: 
The  plaintiff  employed  certain  brokers  of  the 
city  of  New  York  to  make  sale  for  him  of 
the  expected  iron.  The  brcjkers  made  sale 
of  the  same  to  the  defendants  at  12-;4  cents 
per  pound  in  gold,  cash. 

The  following  memorandum  of  sale  was 
made  by  the  brokers;    viz.: — 

"New  York,  July  10,  ISlu.  Sold  for  Messrs. 
Butler  &  Co.,  Boston,  to  Messrs.  A.  A.  Thom- 
son &  Co.,  New  York,  seven  hundred  and 
five  (705)  packs  first-quality  Russia  sheet 
iron,  to  arrive  at  New  York,  at  twelve  and 
three-quarters  (12%)  cents  per  pound,  gold, 
cash,  actual  tare.  Iron  due  about  Sept.  1, 
'67.     White  &  Hazzard.  Brokers." 

The  defendants  contend,  that,  under  the 
statute  of  frauds  of  the  state  of  New  York, 
this  contract  is  not  obligatory  upon  them. 
The  judge  before  whom  the  cause  was  tried 
at  the  circuit  concurred  in  this  view,  and 
ordered  judgment  for  the  defendants.  It  is 
from  this  judgment  that  the  present  review 
is  taken. 

The  provision  of  the  statute  of  New  York 
upon  which  the  question  arises  (2  R.  S. 
p.  13G,  §  3)  is  in  these  words: — 

"Every  contract  for  the  sale  of  any  goods, 
chattels,  or  things  in  action,  for  the  price  of 
fifty  dollars  or  more,  shall  be  void,  unless  (1) 
a  note  or  memorandum  of  such  contract  be 
made  in  writing,  and  be  subscribed  by  the 
parties  to  be  charged  thereby;  or  (2)  unless 
the  buyer  shall  accept  and  receive  part  of 
such  goods,  or  the  evidences,  or  some  of 
them,  of  such  things  in  action;  or  (3)  unless 
the  buyer  shall  at  the  time  pay  some  pait 
of  the  purchase-money." 

The  eighth  section  of  the  same  title  pro- 
vides  that    "every    instrument   required   by 


any  of  the  provisions  of  this  title  to  be  sub- 
scribed by  any  party  may  be  subscribed  by 
the  lavtful  agent  of  such  party." 

There  is  no  pretense  that  any  of  the  goods 
were  acceptt>d  and  received,  or  that  any  part 
of  the  purchase-money  was  paid.  Tlie  ques- 
tion arises  upon  the  tirst  branch  of  the  stat- 
ute, that  a  momoiandum  of  tiie  contract  shall 
b(^  made  in  writing,  and  be  subscribed  by  the 
parties  to  be  chargc^l  thereby. 

The  defendants  do  not  contend  that  there 
is  not  a  sufficient  sub.scription  to  the  con- 
tract. AVhite  &  Hazzard,  who  signed  the  in- 
strument, are  proved  to  have  been  the  au- 
thorized agents  of  the  plaintiff  to  sell,  and 
of  the  defendants  to  buy;  and  their  signa- 
ture, it  is  conceded,  is  the  signatiu'e  both  of 
the  defendants  and  of  the  plaintiff. 

The  objection  is  to  the  sufficiency  of  the 
contract  itself.  Tlie  written  memorandum 
recites  that  Butler  &  Co.  had  sold  the  iron 
to  the  defendants  at  a  price  named;  but  it 
is  said  there  's  no  recital  that  the  defendants 
had  bought  the  iron.  There  is  a  contract  of 
sale,  it  is  argued,  but  not  a  contract  of  pur- 
chase. 

As  we  understand  the  argument,  it  is  an 
attack  upon  the  contract,  not  only  that  it  is 
not  in  compliance  with  the  statute  of  frauds, 
but  that  it  is  void  upon  common-law  princi- 
ples. The  evidence  required  by  the  statute 
to  avoid  frauds  and  perjuries — to  wit,  a  writ- 
ten agreement— is  present.  Such  as  it  is,  the 
contract  is  sufllciently  established,  and  pos- 
sesses the  evidence  of  its  existence  required 
by  the  statute  of  frauds. 

The  contention  would  be  the  same  if  the 
articles  sold  had  not  been  of  the  price  named 
in  the  statute;  to  wit,  the  sum  of  fifty  dol- 
lars. 

Let  us  examine  the  argument.  Blackstone's 
definition  of  a  sale  is  "a  transmutation  of 
property  from  one  man  to  another  in  con- 
sideration of  some  price."  2  Bl.  44G.  Kent's 
is,  "a  contract  for  the  transfer  of  property 
from  one  person  to  another."  2  Kent,  015. 
Bigelow.  C.  J.,  defines  it  in  these  words: 
"Competent  parties  to  enter  into  a  contract, 
an  agreement  to  sell,  the  mutual  assent  of 
the  parties  to  the  subject-matter  of  the  sale, 
and  the  price  to  be  paid  therefor."  Gard- 
ner V.  Lane,  12  Allen.  39,  43.  A  learned  au- 
thor says,  "If  any  one  of  the  ingredients 
be  wanting,  there  is  no  sale."  Atkinson, 
Sales,  r>.  Benj.  Sales,  p.  1.  note,  and  p.  2, 
says,  "To  constitute  a  valid  sale,  there  must 
be  (1)  parties  competent  to  contract;  (2) 
mutual  assent;  (3)  a  thing,  the  absolute  or 
general  property  in  which  is  transferred 
from  the  seller  to  the  buyer;  (4)  a  price  in 
money,  paid  or  promised." 

How,  then,  can  there  be  a  sale  of  seven 
hundred  and  five  packs  of  iron,  unless  there 
be  a  purchase  of  it?  How  can  there  be  a 
seller,  unless  there  be  likewise  a  purchaser. 
These  authorities  require  the  existence  of 
both.  The  essential  idea  of  a  sale  is  that  of 
an  agreement  or  meeting  of  minds  by  which 


430 


STATUTE  OF  FRAUDS. 


a  title  passes  from  one,  and  vests  in  anotlior. 
A  man  cannot  sell  his  chattel  by  a  perfected 
sale,  and  still  remain  its  owner.  There  may 
be  an  offer  to  sell,  subject  to  acceptance, 
which  would  bind  the  party  offering,  and 
not  the  other  party  until  acceptance.  The 
same  may  be  said  of  an  optional  purchase 
upon  a  sufficient  consideration.  There  is 
also  a  class  of  cases  under  the  statute  of 
frauds  where  it  is  held  that  the  party  who 
has  sijj:ned  the  contract  may  be  held  chari^e- 
able  upon  it,  and  the  other  party,  who  has 
not  furuislied  that  evidence  a.i;ainst  himself, 
will  not  be  thus  charseable.  Unilateral  con- 
tracts have  been  the  subject  of  much  discus- 
sion, which  we  do  not  propose  here  to  repeat. 
In  Thornton  v.  Kempster,  5  Taunt.  7SS,  it  is 
said, — 

'"Contracts  may  exist,  which,  by  reason  of 
tlie  statute  of  frauds,  could  be  enforced  by 
one  party,  although  they  could  not  be  en- 
forced by  the  other  party.  The  statute  of 
frauds  in  that  respect  throws  a  dithculty  in 
the  way  of  the  evidence.  The  objection  does 
not  interfere  with  the  substance  of  the  con- 
tract, and  it  is  the  ne.uli.iience  of  the  other 
party  that  he  did  not  taUe  care  to  obtain 
and  preserve  admissible  evidence  to  enable 
himself  also  to  enforce  it." 

The  statute  of  29  Car.  II.,  c.  3,  on  which 
this  decision  is  based,  that  "no  contract  for 
the  sale  of  goods,  wares,  and  merchandise, 
for  the  price  of  £10  sterling  or  upwards,  shall 
be  allowed  to  be  good  except  the  buyer,"  &c., 
is  in  legal  effect  the  same  as  that  of  the 
statute  of  New  York  already  cited.  See  Jus- 
tice v.  Lang,  42  N.  Y.  493,  that  such  is  the 
effect  of  the  statute  of  New  l^ork. 

The  case  before  us  does  not  fall  within  this 
class.  There  the  contract  is  signed  by  one 
partj-  only;  here  both  have  signed  the  paper; 
and,  if  a  contract  is  cieated,  it  is  a  mutual 
one.     Both  are  liable,  or  neither. 

T'nder  these  authorities,  it  seems  clear 
that  there  can  be  no  sale  unless  there  is  a 
purchase,  as  theie  can  be  no  purchase  un- 
less there  be  a  sale.  When,  thei-efore,  the 
parties  mutually  certify  and  declare  in  writ- 
ing that  Butler  &  Co.  have  sold  a  certain 
amount  of  iron  to  Thomson  &  Co.  at  a  price 
named,  there  is  included  therein  a  certificate 
and  declaration  that  Thomson  &  Co.  have 
bought  the  iron  at  that  price. 

In  Newell  v.  Radford,  L.  R.  3  C.  P.  52,  the 
memorandum  was  in  these  words:  *';Mr.  H., 
32  sacks  culasses  at  39s..  280  lbs.,  to  wait  or- 
ders;" signed,  ".John  Williams."  It  was  ob- 
jected that  it  was  impossible  to  tell  from 
this  memoiandum  which  party  was  the  buy- 
er, and  which  was  the  seller.  Parol  proof 
of  the  situation  of  the  parties  was  received, 
and  that  Williams  was  the  defendant's 
agent,  and  made  the  entry  in  the  plaintiff's 
books.  In  answer  to  the  objection  the  court 
say.  "The  plaintiff  was  a  baker,  who  would 
require  the  flour,  and  the  defendant  a  per- 
son who  was  in  the  habit  of  selling  it;"  and 
the  plaintiff   recovered.    It   may    be  noticed, 


also,  that  the  memorandum  in  that  case 
was  so  formal  as  to  contain  no  words  either 
of  purchase  or  sale  ("Mr.  H.,  32  sacks  culas- 
ses at  39s.,  280  lbs.,  to  wait  orders");  but  it 
was  held  to  create  a  good  contract  upon  the 
parol  evidence  mentioned. 

The  subject  of  bought  and  sold  notes  wae 
elaborately  discussed  in  the  case  of  Sivew- 
right  V.  Archibald,  G  Eng.  L.  &  Eq.  2SG;  s.  c. 
17  Q.  B.  103;  Benj.  on  Sales,  p.  224,  sect.  290. 
There  was  a  discrepancy  in  that  case  be- 
tween the  bought  and  sold  notes.  The  sold 
note  was  for  a  sale  to  the  defendant  of  "500 
tons  Messrs.  Dunlop,  Wilson,  &  Co.'s  pig- 
iron."  The  bought  note  was  for  "500  tons  of 
Scotch  pig-iron."  The  diversity  between  the 
bought  and  sold  notes  was  held  to  avoid  the 
contract.  It  was  held  that  the  subject  of 
the  contract  was  not  agreed  upon  between 
the  parties.  It  appeared  there,  and  the  cir- 
cumstance is  commented  on  by  Mr.  .Justice 
Pattesou,  that  the  practice  is  to  deliver  the 
bought  note  to  the  buyer,  and  the  sold  note 
to  the  seller.  He  says,  "Each  of  them,  in 
the  language  used,  purports  to  be  a  repre- 
sentation by  the  broker  to  the  person  to 
whom  it  is  delivered,  of  what  he,  the  broker, 
has  done  as  agent  for  that  person.  Surely 
the  bought  note  delivered  to  the  buyer  can- 
not be  said  to  be  the  memorandum  of  the 
conti-act  signed  by  the  buyer's  agent,  in  or- 
der that  he  might  be  bound  thereby;  for 
then  it  would  have  been  delivered  to  the 
seller,  not  to  the  buyer,  and  vice  versa  as  to 
the  sold  note." 

The  argument  on  which  the  decision  be- 
low, of  the  case  we  are  considering,  was 
based,  is  that  the  contract  of  sale  is  dis- 
tinct from  the  contract  of  purchase;  that  to 
charge  the  purchaser,  the  suit  should  be 
brought  upon  the  bought  note;  and  that  the 
purchaser  can  only  be  neld  where  his  agent 
has  signed  and  delivered  to  the  other  party 
a  bought  note, — that  is,  an  instrument  ex- 
pressing that  he  has  bought  and  will  pay 
for  the  articles  specified.  Mr.  .Justice  Pat- 
teson  answers  this  by  the  statement  that  the 
l)ought  note  is  always  delivered  to  the  buyer, 
and  the  sold  note  to  the  seller.  The  plain- 
tiff here  has  the  signature  of  both  parties, 
and  the  counterpart  delivered  to  him,  and 
on  which  he  brings  his  suit,  is.  according  to 
Mr.  .Justice  Patteson,  the  proper  one  for  that 
purpose,-  that  is,  the  sold  note. 

We  do  not  di.^cover  in  Justice  v.  Lang,  re- 
ported in  42  N.  Y.  493,  and  again  in  52  N.  Y. 
323,  any  thing  that  conflicts  with  the  views 
we  have  expressed,  or  that  gives  material 
aid  in  deciding  the  points  Ave  have  discussed. 

The  memorandum  in  question,  expressing 
that  the  iron  had  been  sold,  imported  nec- 
essarily that  it  had  been  bought.  The  con- 
tract was  signed  by  the  agent  of  l)oth  par- 
ties, the  buyer  and  the  selkn-,  and  in  our 
opinion  was  a  perfect  contract,  obligatorj' 
upon  both  the  parties  thereto. 

Judgment  reversed,  and  cause  remanded 
for  a  new  trial. 


STATUTE  OF  FRAUDS. 


431 


SANBORN  et  al. 

(9  Allen. 


V.   FLAGLER, 

474.) 


Supreme   Judicial    Court    of    Massachusetts. 
Nov.,    18(>4. 

Contract  brought  by  plaintiffs,  who  were  part- 
ners under  the  tirm  name  of  Sanborn,  Richard- 
son &  Co.,  against  John  II.  Flagler  and 

Holdane,  as  partners  under  the  firm  name  of 
Holdane  &  Co.  The  writ  was  seiTed  only  upon 
Flagler.  The  plaintiffs  alleged  that  the  de- 
fendants had  refused  to  deliver  to  tlaem  fifty 
tons  of  best  refined  iron,  in  accordance  with  a 
written  agreement  entered  into  between  them. 
The  defendant  set  up  among  other  defenses  the 
statute  of  frauds.  One  of  the  plaintiffs  was 
called  to  the  stand,  and  produced  to  be  offered 
in  evidence  a  paper,  of  which  the  following  is 
a  copy  as  near  as  can  be  made: 

"Will  deliver  S.  R.  &  Co.  best  refined  iron 
50  tons  within  90  days— at  o  ct  p  lb  4  of  cash. 
Plates  to  be  10  to  10  inches  wide  and  9  ft  to 
11  long.  This  offer  good  till  2  o'clock  Sept.  11, 
1802.     J.  H.  F.     J.  B.  R." 

The  defendant  objected  that  the  paper  was 
not  a  sufficient  memorandum  in  writing  of  the 
alleged  bargain  signed  by  the  party  to  be  (bar- 
ged, and  that  parol  evidence  was  not  admissi- 
ble so  as  to  make  it  such  a  memorandum  as 
could  be  admitted.  The  jtidge  ruled  that  the 
paper  was  a  sufficient  memorandum,  and  would 
bind  the  defendant  if  he  was  a  member  of  the 
firm  of  Holdane  &  Co.  The  witness  then  tes- 
tified that  the  agreement  was  written  by  him, 
and  that  he  and  the  defendant  signed  their  ini- 
tials, the  defendant  writing  the  initials  ".T.  H. 
F.,"  and  he  the  initials  "J.  B.  R.;"  and  that 
before  the  defendant  left  the  plaintiffs'  office, 
and  before  2  o'clock,  he  accepted  the  proposi- 
tion, and  so  stated  to  the  defendant  verbally. 
The  witness  testified  that  he  signed  his  initials 
on  behalf  of  the  plaintiff's,  and  that  he  under- 
stood, the  defendant  to  sign  for  the  firm  of 
Holdane  &  Co.  This  evidence  was  not  de- 
nied by  the  defendant.  The  judge  ruled  that 
said  paper,  with  the  explanation  given,  if 
Richardson  was  believed,  was  a  sufficient  note 
or  memorandum,  and  was  binding  on  the  de- 
fendant if  the  jurj-  found  him  to  be  a  partner 
as  alleged.  The  juiy  found  a  verdict  for  the 
plaintiffs,  and  the  defendant  alleged  excep- 
tions. 


A.  A.  Ranney,  for  plaintiffs. 
for  defendant. 


C.  T.  Russell, 


BIGELOW,  C.  J.  The  note  or  memoran- 
dum on  which  the  plaintiffs  rely  to  maintain 
their  action  contains  all  the  requisites  essential 
to  constitute  a  binding  contract  within  the 
statute  of  frauds.  It  is  not  denied  by  the  de- 
fendant that  a  verbal  acceptance  of  a  written 
offer  to  sell  merchandise  is  sufficient  to  consti- 
tute a  complete  and  obligatory  agreement,  on 
which  to  chai'ge  the  pei-son  by  whom  it  is  sign- 
ed. In  such  case,  if  the  memorandum  is  oth- 
erwise sufficient  when  it  is  assented  to  by  him 
to  whom  the  proposal  has  been  made,  the  con- 
tract is  consummated  by  the  meeting  of  the 


minds  of  tlie  two  i)arties,  and  the  evidence 
necessary  to  lender  it  valid  and  capable  of  en- 
forcement is  supplied  by  the  signature  of  the 
party  sought  to  be  charged  to  the  offer  to  sell. 
Indeed,  the  rule  being  well  settled  that  the 
signature  of  the  defendant  only  is  necessary  to 
make  a  binding  contract  witliin  the  i>rovisions 
of  the  statute  rel:iting  to  sales  of  merchandise, 
it  necessarily  follows  that  an  offer  to  sell  and 
an  express  agreement  to  sell  stand  on  the  same 
footing,  inasmuch  as  the  latter,  until  it  is  ac- 
cepted by  the  otlier  party,  is  in  effect  nothing 
more  than  a  proposition  to  sell  on  the  terms 
indicated.  The  acceptiiuce  of  the  contract  by 
the  i)arty  seeking  to  enforce  it  ujay  always  be 
proved  by  evidence  aliunde. 

The  objections  on  which  the  defendants  rely 
are  twofold.  The  first  is  that  the  note  or 
memorandum  does  not  set  forth  upon  its  face, 
in  such  manner  as  to  be  imdei-slood  by  the 
court,  the  essential  elements  of  a  contract. 
But  this  position  is  not  tenable.  The  natui-c 
and  description  of  the  merchandise,  the  quan- 
tity sold,  the  price  to  be  paid  therefor,  the 
terms  of  payment,  and  the  time  within  which 
the  article  was  to  be  delivered,  are  all  clearly 
set  forth.  But  it  is  urged  that  the  paper  does 
not  disclose  which  of  the  parties  is  the  pur- 
chaser and  which  the  seller,  and  that  no  pur- 
chaser is  in  fact  named  in  the  paper.  This 
would  be  a  fatal  objection  if  well  founded. 
There  can  be  no  contract  or  valid  memoran- 
dum of  a  contract  which  does  not  shew  who 
are  the  contracting  parties.  But  there  is  no 
such  defect  in  the  note  or  memorandum  held 
by  the  plaintiffs.  The  stipulation  is  explicit  to 
deliver  merchandise  to  S.  R.  &  Co.  It  cer- 
tainly needs  no  argument  to  demonstrate  that 
an  agreement  to  deliver  goods  at  a  fixed  price 
and  on  specified  terms  of  payment  is  an  agree- 
ment to  sell.  Delivery  of  goods  at  a  stipu- 
lated price  constitutes  a  sale;  an  agreement 
for  such  delivery  is  a  contract  of  sale.  Nor 
can  there  be  any  doubt  raised  as  to  the  in- 
trinsic import  of  the  memorandum  concerning 
the  character  or  capacity  in  which  the  parties 
are  intended  to  be  named.  A  stipulation  to 
deliver  merchandise  to  a  perst)n  cle:irly  indi- 
cates tliat  he  is  the  purchaser,  because  ii>  every 
valid  sale  of  goods  delivery  must  be  made  by 
the  vendor  to  the  vendee.  We  can  therefore 
see  no  ambiguity  in  the  insertion  of  the  name 
of  the  purchaser  or  seller.  The  case  is  much 
stronger  in  favor  of  the  validity  of  the  memo- 
randum in  this  respect  than  that  of  Salmon 
Falls  Manuf.  Co.  v.  Goddard.  14  How.  440. 
There  only  the  names  of  the  parties  were  in- 
serted, without  any  word  to  indicate  which 
was  the  buyer  and  whii-h  was  the  seller.  It 
was  this  uncertainty  in  the  memorandum 
which  formed  the  main  ground  of  the  veiy 
abl(!  dissenting  opinion  of  Mr.  Justice  Ctirtis 
in  that  case.  So  in  the  leading  case  of  Bailey 
V.  Ogden,  3  .Tohns.  399.  there  was  nothing  in 
the  memorandum  to  shew  which  of  the  two 
parties  named  agreed  to  sell  the  merchandise. 
But  in  the  case  at  bar.  giving  to  the  papei'  a 
reasonable  interpri>tation,  as  a  brief  document 


432 


STATUTE  OF  FRAUDS. 


drawn  up  in  llic  haste  of  business  and  inU'ud- 
0(1  to  express  iu  a  few  words  tlie  terms  of  a 
bar}j:aiu,  we  cannot  entertain  a  doubt  that  it 
indicates  with  sufficient  clearness  that  the 
plaintiffs  were  tlie  purcliasers,  and  the  defend- 
ant tlie  seller  of  the  mercliandlse,  on  the  terms 
therein  expressed.  Indeed  we  can  see  no  rea- 
son why  a  written  agreement  by  one  party  to 
deliver  gomls  to  another  party  does  not  as  clear- 
ly shew  that  the  latter  is  the  purcliaser  and 
the  former  the  seller  as  if  the  agreement  had. 
been  in  express  terms  by  one  to  sell  goods  to 
the  other. 

The  other  objection  to  the  memorandum  is 
that  the  name  of  the  party  sought  to  be  char- 
ged does  not  appear  on  the  face  of  the  paper. 
If  by  this  is  meant  that  the  signatures  of  all 
the  persons  who  are  named  as  defendants  are 
not  affixed  to  the  memorandum,  or  that  it  is 
not  signed  with  the  copartnership  name  under 
Avhich  it  is  alleged  that  the  persons  named  as 
defendants  do  business,  the  fact  is  certainly  so. 
But  it  is  not  essential  to  the  validity  of  the 
memorandum  that  it  should  be  so  signed.  An 
agent  may  write  his  own  name,  and  thereby 


bind  liis  principal;  and  parol  evidence  is  com- 
petent to  pi'ove  that  he  signed  the  memoran- 
dum in  his  capacity  as  agent.  On  the  same 
principle,  a  partner  may  by  his  individual  sig- 
nature bind  the  tirm,  if  the  contract  is  within 
the  scope  of  the  business  of  the  firm,  which 
may  be  shewn  by  extrinsic  evidence.  Soames 
V.  Spencer,  1  D.  &  R.  32;  Long,  Sales,  38; 
Browne,  St.  Fraud,  §  367;  Higgins  v.  Senior, 
8  M.  &  W.  834;  Williams  v.  Bacon,  2  Gray, 
387,  393.  Besides,  in  the  case  at  bar,  the  ac- 
tion is  in  effect  against  Flagler  alone.  He 
only  has  been  sei-ved  with  process  and  appears 
to  defend  the  action.  AVhether  he  signed  as 
agent  for  the  firm  or  in  his  individual  capacity 
is  immaterial.  In  either  aspect  he  is  liable 
on  the  contract. 

It  is  hardly  necessary  to  add  that  the  signa- 
ture is  valid  and  binding,  though  made  with 
the  initials  of  the  party  only,  and  that  parol 
evidence  is  admissible  to  explain  and  apply 
them.  Phillimore  v.  Barry,  1  Camp.  513;  Sal- 
mon Falls  Manuf.  Co.  v.  Goddard,  ubi  supra; 
Barry  v.  Combe,  1  Pet.  640.  Exceptions  ovei"- 
ruled. 


STATUTE  UF  FKAU1>S. 


433 


BAGBY  et  al.  v.  WALKER  et  al.  (two  eases, 
Nos.  35,  36). 

(27  Atl.  1033,  78  Md.  239.) 

Court  of  Appeals  of  Maryland.      Nov.  10,  1893. 

Appeals  from  superior  court  of  Baltimore 
city. 

Two  actions:  One  by  Artluir  M.  Walker 
aud  James  K.  Myc'rs,  trading  as  Walker  & 
Myers,  ajxainst  Charles  T.  F.a^iby  aud  Arthur 
D.  Rivers,  tradiu^  as  Bagby  &  Rivers;  the 
other  by  Bagby  &  Rivers  against  Walker  & 
Myers.  Judgment  for  Walker  &  Myers. 
Bagby  &  Rivers  appeal.  Reversed  as  to  first 
action;    affirmed  as  to  second  action. 

Argued  before  BRYAN,  BRISCOE,  ROB- 
ERTS,  FOW^LER,  and  McSHERRY,  JJ. 

Pollard  &  Sappington  and  William  S.  Bry- 
an, Jr.,  for  plaintiffs.  Thus.  Ii-elaud  T^lliott 
and  R.  R.  Battee,  for  defendants. 

McSHERRY,  J.  The  only  questions  in- 
volved in  the  two  cases  now  before  us  arise 
on  the  single  exception  reserved  to  the  rul- 
ings; of  the  superior  court  of  Baltimore  on 
several  prayei-s  for  instructions  to  the  jm"y. 
There  were  two  actions  between  the  same 
parties,  tried  at  the  same  time  in  the  court 
below.  In  one.  Walker  &  Myers,  the  ap- 
pellees here,  were  plaintiffs,  and  the  ap- 
pellants were  defendants;  in  the  other,  Bag- 
by &  Rivers,  the  appellants  here,  were  plain- 
tiffs, aud  tlie  appellees  were  defendants.  In 
the  first.  Walker  &  :Myers  sued  to  recover 
the  balance  due  upon  the  contnict  price  of 
certain  lumber  sold  and  delivered  by  them  to 
Bagby  &  Rivei*s,  and  also  to  recover  tlie  dif- 
ference between  the  contract  price  and  the 
market  price  of  certain  other  lumber  sub- 
sequently ordered,  but  which  Bagby  &  Riv- 
ers refu-sed  to  accept.  A  judgment  was  en- 
tered in  favor  of  the  plaintiffs.  In  the  seo- 
ond  case,  Bagby  &  Rivers  sued  to  recover 
damages  for  a  failure  on  the  part  of  Walker 
«fc  Myers  to  deliver  the  kind  and  quality 
of  lumber  stipulated  for.  and  also  for  a  fail- 
ure to  deliver  within  the  time  designated  in 
the  agreement  a  large  part  of  the  lumber 
sold  by  them  to  Bagby  &  Rivers.  A  judg- 
ment of  non  pros,  was  entered  in  the  case. 
The  contract  is  embodied  in  a  letter  from 
Bagby  &  Rivers  to  Walker  &  Myei-s  under 
date  of  January  29,  1891.  and  a  written  ac- 
ceptance of  the  teiTDS  by  Walker  &  Myers 
on  the  same  date.  The  time  limited  for  fill- 
ing the  order  was  three  months.  The  first 
delivery  under  this  written  contract,  about 
the  execution  of  which  there  is  no  dispute, 
was  made  in  the  following  March,  and  the 
last  on  November  27th  of  the  same  year, 
long  after  the  expiration  of  the  three-months 
limit.  The  price  of  the  luml>er  actually  de- 
livered amounted  to  $1,(53.j.o8,  and  the  pay- 
ments made  thereon,  beginning  in  April  and 
ending  in  August,  aggregated  .$1,137.98.  leav- 
ing   an    impaid    balance    of    .$4J7.70.     There 

VA>f  ZILESEr-.CAS.SALKS-28 


was   evidence   in  the   c;'.;sc   tei.diiig   lo   ijrove 
that    Bagby    &    Rivers    had    waived    the    re- 
quirement of  time  mentiontfl  in  the  letter  of 
Januaiy  29,   1891,  as  to  the  delivery  of  tht- 
lumber.      Walker  &  Myers  offered  other  evi- 
dence,   tending   to   prove  that    in   the  latter 
part  of  Novend)er  they,  at  tlie  request  and 
upon  a  verbal  order  of  Bagby  &  Rivei-s,  cut 
and    shipped   to  Baltimore   other   lumber,    in 
addition  to  that  specified  in  the  contract,  at 
a   i)rice   agreed    upon   between    them,    which 
lum    'r   they  oftercni   to  Bagby  &   Rivei-s  in 
two   lots   in   Januarj'   and   March.    1892,    but 
that   Bagl)y  &  Rivei-s  refiLsed  to   receive  it, 
and  t'^at  Walker  &  Myers  lost  by  those  re- 
fusals .$179.20,  that  sum  being  the  difference 
between  the  price  agrin^-d  upou  and  the  mar- 
ket price  when  the  d<'liveri(«  were  tendered. 
Bagby  &  Rivers  denied  giving  the  order  for 
this  additional  lumber.    The  lumber  was  cut 
by  ^^'alker  cV:  flyers  at  their  mills  in  Xoith 
Carolina  for  the  purpose  of  filling  these  two 
orders,    and    was    transported    to   Baltimore, 
where  it  was  unloaded   on   the  whaiwes  of 
Walker  &  Myers,  from  whence  all  of  it,  ex- 
cept the  two  lots  which  Bagby  &  Rivei-s  re- 
fused to  take,  was  hauled  by  Bagby  &  Riv- 
ei-s,  after  being  inspected  by  them,  to  their 
furniture    factoiy.     I'pon    these    facts     the 
court  instiiicted  the  jury  at  the  instance  of 
Walker  ct   Myers  that,   notwithstanding  the 
mention  in   the   letter   of  January,    1891,    of 
the  period  of  three  months  as  the  limit  with- 
in which    the   luml>er  was  to  be   furnished, 
still,  if  the  juiy  should  find  that  Bagby   & 
Rivei-s  waived  that  requirement,  and  accept- 
ed  and    hauled   lumber  from   the    plaintJft's' 
wharves  until  November  27,  1891,  then   the 
defendants  would  not  be  entitled  to  recoup 
against    the    plaintiffs'    claim    any    damages 
sustained  by  the  defendants  by  reason  of  the 
failure  of  the  plaintiffs  to  deliver  the  lum- 
ber   within    the    time    stipulated.       Further, 
that  if  the  defendaiats  ordered  other  lumber, 
that   the    plaintiffs   cut   it  upon    that    order, 
and  offered  it  to  the  defendants  at  the  iLsual 
place  of  deliveiy;    that  it  was  of  the  quality 
ordered;    and  that  the  defendants  refused  to 
take  it,  and  pay  for  it,— then   the  plaintiffs 
would    be    entitled    to   recover   damages   for 
that  refusal.     This  was    Walker    &    Myers' 
third   prayer.     And.   finally,   that  under   the 
last    preceding    instruction    the    measure    of 
damages    would    be    the   difference    between 
'the  price  agreed  upon  and  the  market  price 
in  Baltimore  at  the  dates  when  the  lumber 
should     have  been   accepted.      ISIere  accept- 
ance of  the  lumber  after  the  expiration  of 
the  time  fixed  in  the  agreement  for  its  de- 
livery   was    not    of    itself    a    waiver    of    the 
breach  committed  by  the  failure  to  deliver  it 
according  to  the  terms  of  the  contract;    nor 
did  such  an  acceptance  preclude  the  vendees 
from  subsequently  suing  to  recover  the  dam- 
ages resulting  to  them  by  reason  of  the  non- 
deliveiT  from  the  time  of  default  up  to  the 
date    of    acceptance;    nor    from    recouping, 
when   sued   by   the  vendoi-s,    those   damages 


431 


STATUTE  OF  FRAUDS. 


ajjainst  tho  lattor's  claim  for  the  pun-has«^ 
mouey.  Central  Tiiist  Co.  v.  Arctic  Ice 
Mach.  Maiuifj,'  Co.,  77  Md.  202.  26  Atl.  493. 
The  instnictidu  does  not  question  these  prin- 
ciples. It  does  not  proceed  upon  the  theory 
that  acceptance  after  a  refusal  to  deliver 
within  the  stii)idated  time  is  of  itself,  with- 
out more,  equivalent  to  a  waiver  of  the  time 
for  delivery,  but  distinctly  leaves  to  the  jury 
to  tiud  from  the  evide^nce  in  the  case  wheth- 
er, ITS  an  indepeiulent  fact,  Bagby  &  Rivers 
waived  the  nMiuirenient  that  the  lumber 
should  be  furnished  within  three  months. 
If  they  did  waive  that  requirement,  they 
could  uot  subse(iuently  found  Jin  action  upon 
Its  uonpcrfoi'mauce,  nor  rely  thereon  by  way 
of  rec-oupm(>nt.  If  they  condoned  the  breach, 
they  cannot  afterwards  ba.se  a  claim  for 
damages  upon  it.  There  was  evidence  be- 
fore the  jui-y  to  the  effect  that  Bagby  & 
Rivei-s  had  Avaived  the  requirement  of  time 
mentioned  in  the  letter  of  January  29,  1891, 
and  no  special  exception  was  taken  to  the 
prayer  upon  the  ground  that  there  M'as  no 
evidence  in  the  cause  to  support  it.  It  is  a 
mistake  to  suppose  that  the  prayer  is  fomid- 
ed  upon  the  assumption  that  a  mere  accept- 
ance of  the  lumber  was  tantamount  to  a 
waiver  of  the  time  for  delivery,  and  there  is 
nothing  in  the  stiiicture  of  the  prayer  at  all 
calculated  to  mislead  the  jury  to  such  a  con 
elusion.  There  was,  in  our  opinion,  no  error 
committed  by  the  granting  of  it. 

The  two  remaining  instructions  given  at 
the  instance  of  Walker  &  Myers  relate  to 
the  lumber  which  Bagby  «&  Rivers  refused 
to  receive.  There  were  three  objections  sug- 
gested to  the  first  of  these  two  instructions, 
which  is  the  third  prayer  of  \Yalker  &  My- 
ers; and  these  are:  First,  that  the  instruc- 
tion makes  reference  to  the  facts  stated  in 
an  antecedent  prayer,  which  was  rejected, 
and  which  was  consequently  not  before  the 
jiu'}-;  second,  that  the  contract  upon  which 
it  permits  a  recovery  is  void  under  the  sev- 
enteenth section  of  the  statute  of  frauds; 
and,  third,  that,  no  time  having  been  named 
in  the  verbal  contract  for  the  delivery  of 
lumber  under  it,  a  reasonable  time  was  im- 
plied by  law,  and  the  finding  of  what  was 
a  reasonable  time  should  have  been  left  to 
the  jury.  The  first  objection  is  not  a  sub- 
stantial one.  A  reference  to  the  facts  stated 
in  the  rejected  prayer  was  wholly  superflu- 
ous. Eliminating  that  reference  altogether 
in  no  way  affected  the  integrity  of  the  in- 
struction. Its  remaining  in  the  instruction 
could  not  possibly  have  misled  or  confused 
the  jiu-y,  and  obviously  did  not  prejudice 
or  injure  the  appellants.  The  second  objec- 
tion, though  more  plau.sible,  is  not  more  tena- 
ble. While  the  seventeenth  section  of  the 
statute  of  frauds  (29  Car.  II.,  c.  3)  declares 
all  contracts  for  the  sale  of  goods,  wares, 
and  merchandise  for  the  price  of  £10  and 
upwards  to  be  invalid  unless  part  of  the  goods 
be  accepted,  or  part  of  the  price  be  paid, 
or  something  be  given  in  earnest  to  bind  the 


bargain,  or  some  note  or  memorandum  In 
writing  be  signed  by  the  party  to  be  chargcil, 
still  from  a  very  early  period  It  has  been 
the  settled  law  of  Maryland,  where  the  Stjit- 
ute  of  Charles  has  always  been  in  force, 
that  when  work  and  labor  are  to  be  bestow- 
ed by  the  vendor  upon  the  article  sold  before 
it  is  to  be  delivered  the  contract  in  not 
within  the  statute,  (Eichelberger  v.  MeCau- 
ley,  5  Har.  &  J.  213;  Rentch  v.  Long,  2y  Md. 
188;)  and  the  reason  is  that  when  work  and 
labor  are  necessary  to  prepare  an  article  for 
delivery  the  work  and  labor  to  be  done  by 
the  vendor  form  part  of  the  consideration  of 
the  contract,  and,  as  these  are  not  within 
the  statute,  the  sale  is  not  a  sale  of  goods, 
wares,  and  merchandise,  within  the  meaning 
of  the  seventeenth  section  of  29  C.ir.  II.,  c.  3. 
Now,  the  proof  shows  that  when  the  alleg- 
ed verbal  order  was  given,  shortly  after  No- 
vember 29,  1891,  for  this  additional  lumber, 
it  was  necessary  for  Walker  &  IMyers  to 
have  the  lumber  cut  or  prepared  for  deliv- 
ery,—to  put  it  in  a  condition  different  from 
that  in  which  it  was  at  the  time  the  con- 
tract was  made.  This  circumstance  took  the 
contract  out  of  the  operation  of  the  statute. 
The  third  objection  to  the  instruction  is, 
though  narrow,  substantial  an.l  fatal.  No 
time  was  fixed  in  the  alleged  verbal  contract 
of  November,  1891,  for  the  delivery  of  the 
lumber  under  it.  The  law  in  all  such  in- 
stances prescribes  a  reasonable  time,  (Kriete 
V.  Myer,  Gl  Md.  558;)  and  it  is  for  the  jury, 
under  aU  the  circumstances  of  the  case,  to 
determine  what  is  a  reasonable  time,  (Bud- 
die V.  Green,  3  Hurl.  «&  N.  90o;  Bryam  v. 
Gordon,  11  Mich.  531;  Finney  v.  Railroad 
Co.,  19  Minn.  251,  [Gil.  211;]  Stange  v.  Wil- 
son, 17  Mich.  312;  Kriete  v.  Myer,  61  Md. 
558.)  But  this  instruction  submitted  no  such 
question  to  the  jury.  The  proof  showed  that 
Walker  &  Myers  tendered  delivery  of  this 
lumber  in  two  lots,— one  on  January  2d,  and 
the  other  on  March  22,  1892;  but  whether 
these  were  within  a  reasonable  time,  under 
all  the  circumstances  of  the  case,  was  not 
only  not  left  to  the  jury  to  determine,  but  was 
in  effect  decided  by  the  court.  Tlie  instruc- 
tion assumed  that  the  offers  to  deliver  were 
made  within  a  reasonable  time,  for  it  left  to 
the  jury  to  find  that  the  order  for  the  lum- 
ber was  given;  that  the  lumber  was  cut; 
that  it  was  offered  to  Bagby  &  Rivers  at  the 
ujiKil  place  of  delivery;  that  its  quality  was 
sur-ili  as  had  been  specified,  and  that  the  de- 
ftmdjLH/^s  refused  to  accept  it;  and  then  in- 
jrtrD£ted  them  that  upon  the  finding  of  these 
facts  ;he  plaintiffs  were  entitled  to  recover. 
But  the  time  when  the  offer  to  deliver  was 
made,  which  was  a  necessary  element  of  the 
Plaintiff's  case,  was  entirely  ignored.  Whether 
the  offer  had  been  made  within  a  reasonable 
time  or  not  was  exclusively  for  the  jury  to 
say,  but  it  was  not  submitted  to  them.  The 
instruction,  by  directing  a  verdict  for  the 
plaintiffs  upon  the  finding  of  the  facts  above 
stated,   necessarily  assumed  that  the  offers 


STATUTE  OF  FRAUDS. 


435 


todeJJvor  had  been  made  within  a  reasonable 
tim.r,  because,  unless  the  offers  to  deliver  had 
been  made  within  a  reasonable  time,  the 
plaintiffs  had  no  right  to  recover  at  all.  But 
it  was  not  witliin  the  province  of  the  court 
to  assume  or  to  det-ide  that  qmsstion.  and, 
as  a  consequence,  the  insti-uctiou  in  which 
that  was  done  was  erroneous. 

The  remaining  prayer  granted  upon  the  re- 
quest of  Walker  &  Myers  relates  to  the 
measui'e  of  damages  for  the  refusal  of  Bag- 
by  &  Rivers  to  receive  the  lumber  offered  to 
them  in  January  and  March,  1892,  and  cor- 
rectly states  the  law  on  that  subject.  Pinck- 
ney  v.  Dambmann.  72  Md.  1S3,  ID  Atl.  450. 
But,  inasmuch  as  this  instruction  was  depend- 
ent upon  and  a  mere  corollary  from  the  pre- 
ceding erroneous  instruction,  though  correct 
as  an  abstract  proposition,  there  was  error  in 
granting  it.  Had  the  previous  instruction 
been  right,  this  one  would  have  been  properly 
given 

The  superior  court  rejected  the  first  and 
fourth  prayers  presented  by  Bagby  &  Riv- 
ers, and  these  prayers  raise  the  only  other 
questions  open  for  review.  The  fourth  pray- 
er was  very  properly  abandoned  in  the  ar- 
gument, and  we  need  therefore  give  to  it 
no  consideration.  The  first  prayer  of  Bagby 
&  Rivers  asked  the  court  to  say  to  the  jury 


that  if  they  should  find  that  Bagby  &  Riv- 
ers were  induced  to  receive  the  lumber  by 
false  representations  knowingly  made  by 
Walker  &  Myers  as  to  its  quality  and  condi- 
tion, then  Bagby  &  Rivers  would  not  be 
bound  by  any  in.spection  made  by  them  of 
the  lumber.  We  need  only  say,  in  dispos- 
ing of  this  prayer,  that  there  is  no  evidence 
in  tlie  record  to  show  that  Walker  &  Myers 
knowingly  made  any  false  representations  as 
to  the  quality  and  condition  of  the  lumber, 
and  that,  therefore,  it  would  have  been  im- 
proper to  allow  the  jury  to  speculate  upon 
that  subject,  as  they  must  have  done  had 
this  prayer  been  gi'anted. 

It  follows  from  the  views  we  have  express- 
ed that  there  was  no  error  committed  by  the 
court  in  its  rulings  in  the  case  of  Bagby  & 
Rivers  against  Walker  &  Myers,  and  its 
judgment  of  non  pros,  in  that  case  will  be 
affirmed.  It  also  follows  that,  as  there  was 
error  committed  in  granting  the  third  and 
fourth  prayers  presented  by  Walker  &  My- 
ers, the  judgment  in  the  case  of  Walker  & 
Myers  against  Bagby  &  Rivers  must  be  re- 
versed,  and  a   new   trial   will   be   awarded. 

Judgment  in  No.  35  revei-sed,  with  costs 
above  and  below,  and  new  trial  awarded. 
Judgment  in  No.  36  affirmed,  with  costs 
above  and  below. 


4;36 


STATUTE   OF  FRAUDS. 


COFFIN  et  al.  t.  BRADBURY  c-t  al.i 

(35  Pac.  715.) 
Supreme  Court  of  Idaho.     Jan.  26,  1894. 

Apppfil  from  district  Cdiirt,  Ada  county;  Ed- 
ward   Nufjoiit,    .Tudso. 

Action  hy  Frank  R.  Cottin  and  others 
M^'ainst  W.  C.  Bradbnry  and  others  to  re- 
cover the  price  of  jiroods  sold.  There  was 
judj;nient  for  phiintilTs,  and  from  the  order 
denying  a  now  trial,  defendants  appeal.  Af- 
firmed. 

Texas  Angel  and  S.  L.  Tipton,  for  appel- 
lants. Geo.  H.  Stewart,  W.  E.  Borah,  and 
Edgar  Wilson,  for  respondents. 

SULLIVAN,  J.  This  action  was  brought 
to  recover  the  value  of  five  New  Era  ditch- 
ers, alleged  to  have  been  sold  to,  and  re- 
ceived and  accepted  by,  appellants,  who  were 
defendants  in  the  court  below.  The  answer 
is  a  general  denial  of  the  allegations  of  the 
complaint.  The  action  was  tried  by  the 
court  with  a  jury,  and  a  verdict  rendered 
in  favor  of  respondents  for  the  sum  of  $G,- 
052.91,  together  with  interest,  amounting  to 
.'?1. 059.21,  on  which  .verdict  judgment  was 
duly  entered  against  appellants.  A  motion 
for  a  new  trial  was  interposed  and  overruled 
by  the  court.  This  appeal  is  from  the  order 
denying  the  motion  for  a  new  trial,  and  from 
the  judgment. 

Respondents  contend  that  the  errors  al- 
leged to  have  occiu'red  on  the  trial  were  not 
properly  saved  and  preserved,  so  as  to  au- 
thorize this  court  to  consider  them  on  this 
appeal.  Their  contention  is,  that  under  the 
provisions  of  section  4420,  Rev.  St.  18S7, 
each  exception  taken  on  the  trial  must  be 
settled  at  the  time  the  decision  is  made, 
Mother  than  those  deemed  excepted  to  by  the 
provisions  of  section  4427,  Rev.  St.,)  unless  a 
different  time  is  agreed  upon  by  the  parties; 
that  no  exceptions  were  settled  during  the 
trial,  and  no  time  agreed  upon  by  the  par- 
ties for  their  settlement.  The  record  con- 
tains a  stipulation,  in  which  it  is  agreed 
that,  at  the  trial  of  this  case  in  April,  1892, 
which  resulted  in  a  disagi'eement  of  the 
jm-y,  the  following  entry  was  made  in  the 
minutes  of  the  court,  to  wit,  "The  parties 
here  stipulated  that  they  might  prepare  a 
bill  of  exceptions  after  trial."— and  upon  this 
stipulation  the  appellants  rely,  and  contend 
that  it  remained  in  force  and  effect  at  the 
trial  that  resulted  in  the  judgment  from 
whic-h  this  appeal  was  taken;  while  respond- 
ents contend  that  said  stipulation  applied 
to  the  trial  then  in  progre-ss,  and  no  other, 
and  applied  to  a  settlement  of  a  bill  of  ex- 
ceptions, under  the  provisions  of  section 
4439,  Rev.  St.  1887,  and  not  to  exceptions 
taken  on  the  ti'ial.  This  contention  was  ae- 
nied  by  the  trial  court,  and  no  exception  tak- 
en  thereto,   and  no  appeal  has   been   taken 

1  Opinion  of  Morgan,  J.,  omitted. 


therefrom.  The  plaintiff  cannot  have  error.1 
alleged  to  have  been  cou}mitted  against  him- 
self reviewed  on  defendant's  appeal.  The 
appeal  of  either  party  brings  up  only  the  er- 
rors alleged  to  have  been  committed  against 
himself.  If  the  I'espondent  in  an  appeal  de- 
sires to  have  errors  against  himself  corrected, 
he  must  present  them  to  this  court  on  his 
own  appeal.  Jones  v.  Irrigating  Co.,  2  Idaho, 
58,  3  Piic.  1. 

The  first  error  specified  is  the  insufficiency 
of  the  evidence  to  justify  the  verdict.  Un- 
der this  specification  of  error,  the  question  of 
the  validity  of  the  contract  sued  on,  when 
tested  by  the  statute  of  frauds,  is  raised. 
It  is  contended  that,  as  the  value  of  the  prop- 
erty sued  for  is  shown  to  have  exceeded 
$200,  the  contract,  or  some  memorandum 
thereof,  must  be  in  writing,  and  subscribed 
by  the  party  charged,  or  by  his  agent,  unless 
the  buyer  accepted  and  received  a  part  of 
said  property,  or  paid,  at  the  time  of  the  bar- 
gain, some  part  of  the  purchase  price;  that, 
as  none  of  these  reqmrements  were  complied 
with,  said  contract  comes  within  the  provi- 
sions of  section  6009  of  the  Revised  Statutes 
of  1887.  The  provisions  of  said  sect  on, 
claimed  to  be  applicable  to  this  case,  are  as 
follows:  "In  the  follovv'ing  cases  the  agree- 
ment is  invalid  unless  the  same  or  some 
note  or  memorandum  thereof  be  in  writing, 
and  subscribed  by  the  party  charged  or  by 
his  agent.  Evidence  therefore  of  the  agree- 
ment cannot  be  received  without  the  writing 
or  secondary  evidence  of  its  contents:  *  *  * 
Subd.  4.  An  agreement  for  the  sale  of  good.^, 
chattels,  or  things  in  action,  at  a  price  not 
less  than  two  hundred  dollars,  unless  the 
buj'er  accept  and  receive  part  of  such  goods 
and  chattels,  or  the  evidences,  or  some  of 
them,  of  such  things  in  action,  or  pay  at  the 
time  some  part  of  the  piu-chase  money." 
It  is  sufficient,  under  this  section  of  the 
statute,  if  the  chattels,  goods,  or  things 
in  action  are  delivered  to  and  accepted  by 
the  purchaser,  at  any  time  after  the  con- 
tract of  purchase  is  made.  But,  unless  the 
provisions  of  said  section,  above  quoted,  are 
complied  with,  the  seller  could  not,  at  any 
time  after  the  contract  was  made,  deliver  the 
goods,  and  compel  an  acceptance  of  them. 
However,  if  the  goods  are  received,  and  ac- 
cepted by  the  purchaser,  the  contract  is  then 
taken  out  of  the  statute  of  frauds,  and  may 
be  enforced  agsinst  the  buyer,  for  the  pur- 
chase price.  It  is  alleged  in  the  complaint 
that  said  ditchei's  were  sold  to  appellants  on 
the  14th  day  of  March.  1890,  and  that  there- 
after they  accepted  and  received  the  same. 
It  is  not  claimed.  b,Y  respondents,  that  they 
aver  or  prove  a  delivery  and  acceptance,  at 
the  time  the  contract  of  sale  was  entered 
into,  or  that  the  contract,  or  some  note  or 
memorandum  thereof,  was  in  writing,  signed 
by  appellants,  or  by  their  agents,  or  that  any 
part  of  the  purchase  money  Avas  paid  at  the 
time  the  contract  was  entered  into.  It  is 
the  receipt  and  acceptance  of  the  machines, 


STATUTE  OF  FRAUDS. 


437 


Borne  15  days  after  the  contract  of  purchase 
was  made,  that  respondeuts  rely  upon  as 
taking  this  contract  out  of  the  provisions  of 
said  section,  and,  we  think,  with  reason.  If 
a  contract  of  sale  is  made,  and  the  property 
subseQUPUtly  received  and  accepted  by  the 
purchaser,  it  is  then  too  Lite  to  escape  liabili- 
ty thereon,  because  of  the  provisions  of  said 
section.  Had  the  purchaser  refused  to  re- 
ceive and  accept  the  property,  and  suit  been 
brou.i;ht  to  enforce  the  contract,  said  statute 
would  have  been  a  complete  defense  to  such 
action,  but,  after  the  receipt  and  acceptance 
of  the  prop.n-ty,  the  virtue  of  said  section,  as 
a  defense  to  an  action  to  recover  the  pur- 
chase price,  is  gone.  This  section  of  the 
statute  of  frauds  only  relates  to  executory 
contracts,  and  not  to  executed  ones.  Re- 
ceipt and  acceptance  of  the  property  sold, 
at  any  time  after  makins  the  contract,  takes 
the  contract  out  of  the  statute  of  frauds. 
Hinkle  v.  Fisher,  (Ind.  Sup.)  3  N.  E.  62i; 
King  V.  Jarman,  37  Amer.  Rep.  11;  Cartan 
v.  David,  18  Xev.  311,  4  Pac.  Gl;  Dodge  v. 
Crandall,  30  N.  Y.  294;  Brown  v.  Trust  Co., 
117  X.  y.  2G6,  22  X.  E.  932. 

The  second  contention  is,  that  said  ditchers 
were  not  delivered  to,  or  received  and  ac- 
cepted by,  appellants.  The  evidence  of  re- 
spondeuts shows  that,  at  the  time  said  ditch- 
ers were  ord'red,  J.  M.  Bray  informed  Sher- 
man M.  CofHn  that  a  man  by  the  name  of 
Jessop  was  going  to  use  the  ditchers  in  the 
construction  of  a  certain  ditch,  which  appel- 
lants were  constructing  under  the  supervi- 
sion of  J.  M.  Bray.  It  also  shows  that, 
when  the  ditching  machines  arrived  at  Xam- 
pa,  Jessop  appeared,  and  assisted  in  setting 
them  up  ready  for  use;  that  he  took  posses- 
sion of  them,  and  took  them  out  upon  the 
aforesaid  ditch,  and  went  to  work  thereon 
with  them;  that,  while  taking  them  out  on 
the  ditch,  he  met  Mr.  Bray;  that  he  used 
them  on  .said  ditch,  imder  the  immediate  su- 
pervision of  Mr.  Bray,  for  two  months,  at 
least.  It  was  conceded,  on  the  trial,  that 
the  ditchers  were  delivered  to  Jessop,  who 
was  a  subcontractor  of  appellants,  and  the 
question  of  acceptance  does  not  appear  to 
have  attained  special  prominence  during  the 
trial  of  the  casa  Upon  a  careful  review  of 
the  entire  evidence,  I  think  it  tends  to  show 
that  the  ditchers  were  purchased  for  the  use 
of  Jessop,  and  that  he  received  and  accepted 
them,  and  that  his  receipt  and  acceptance 
was  the  receipt  and  acceptance  of  Bradbui'y 
&  Bray,  and  boiuid  them. 

The  questions  of  sale  and  delivery  were 
submitted  to  the  jury,  upon  an  instruction  by 
the  court,  at  the  request  of  appellants,  where- 
by the  jury  was  instructed  that,  to  entitle 
the  plaintiffs  to  recover,  they  must  estab- 
lish, by  a  preponderance  of  evidence,  the 
sale  and  delivery  of  the  ditchers  to  the  de- 
fendants, and,  by  their  verdict,  they  found 
those  points  in  favor  of  respondents.  When, 
from  the  entire  evidence,  different  minds 
might  honestly  reach  a  different  conclusion, 


as  to  the  acceptance  of  the  property  sold, 
the  question  of  acceptance  is  one  of  fact,  for 
the  jury,  and  their  verdict  thereon  will  not 
be  disturbed.  Xor  will  the  order  of  the 
com"t,  denying  a  motion  for  a  new  trial,  be 
reversed  when  the  aforesaid  conditions  ex- 
ist. See  note  to  Shindler  v.  Houston,  49 
Amer.  Dec.  310;  Gray  v.  Davis,  10  X.  Y.  291; 
Baker,  Sales,  §  302a;  Thielen  v.  Rath,  (Wis.) 
50  X.  W.  183;  Calvin  v.  :\IacKenzie,  (Or.)  27 
Pac.  1039;  Garfield  v.  Paris,  9G  U.  S.  557; 
Hinchman  v.  Lincoln,  124  U.  S.  39,  8  Sup. 
Ct.  309. 

Considerable  authority  is  cited  on  the  ques- 
tion as  to  what  acts  constitute  an  acceptance, 
under  said  section  0309.  The  correctness  of 
the  rule  established  by  the  authorities  cited 
is  not  qu(>stion(Hl.  Tlie  case  of  Shindler  v. 
Houston,  49  Amer.  Dec.  310,  is  cited  as  a 
case  in  point.  It  was  held,  in  that  case,  that 
delivery  and  acceptance  of  goods,  such  as 
will  take  it  out  of  the  statute  of  frauds,  can- 
not be  shown  by  mere  words.  Some  acts 
transferring  possession  are  necessary.  That 
case  is  not  in  point,  for  the  reason  that  it  is 
not  claimed  nor  shown  that  the  transfer  of 
the  possession  of  said  machines  was  made 
by  mere  words,  but  that  the  machines  were 
set  up  and  possession  of  them  given;  that 
respondents  parted  with  possession,  and 
thereafter  exercised  no  rights  of  possession 
or  ownership  over  them;  that  the  person  for 
whose  use  they  were  intended  took  them, 
and  put  them  to  the  very  use  for  which  they 
were  purchased.  The  case  of  Hinchman  v. 
Lincoln,  124  U.  S.  38,  8  Sup.  Ct.  309,  is  cited 
as  a  case  very  similar  to  the  one  at  bar. 
I    That  is  a  case  where  the  facts,  in  relatioir  to 


the  contract  of  sale,  alleged  to  have  been 
within  the  statute  of  frauds,  were  admitted. 
There  was  no  di.-^pute  as  to  the  facts  on 
which  appellant  relied,  showing,  as  he  claim- 
ed, sale,  delivery,  and  acceptance.  The 
court  held  that,  as  there  was  no  dispute  as 
to  the  facts,  it  belonged  to  the  court  to  deter- 
mine their  legal  effect.  It  was  also  hold  that, 
to  take  an  alleged  contract  of  sale  out  of  the 
operation  of  the  statute  of  frauds,  there 
must  be  acts  of  such  a  character  as  to  place 
the  property  unequivocally  within  the  power 
and  under  the  exclusive  dominion  of  the 
buj-er.  as  absolute  owner,  and  that,  when 
anything  remained  to  be  done  by  the  seller 
to  perfect  the  delivery,  such  fact  would  be, 
generally,  conclusive  that  there  was  no  re- 
ceipt by  the  buyer.  This  case  is  very  differ- 
ent from  the  one  under  consideration.  The 
facts  of  sale,  delivery,  and  acceptance  were 
in  dispute,  and  nothing  is  shown  which  would 
indicate  that  anything  remained  to  be  done 
by  the  seller  to  perfect  the  delivery  of  said 
machines.  It  is  earnestly  contended  by  ap- 
pellants, and  with  apparent  confidence,  that 
all  of  the  evidence,  taken  together,  sliows 
that  the  sale  of  said  ditching  machines  was 
made  by  Stearns  to  Jessop  a  day  or  two  be- 
fore Sherman  Coffin  met  Bray  at  Xampa. 
It  is  claimed   that   Stearns  testified  that  he 


438 


STATUTE  OF  FRAUDS. 


sold  said  niachinps  to  Jossop.  Mr.  Stearns, 
as  a  witness  for  appellants,  on  direct  exami- 
nation, did  testify  that  he  sold  four  ditch- 
ers to  Jessop.  lie  afterwards  testified  as 
follows,  to  wit:  "Q.  Why  did  you  telephone 
for  Cotlin  to  come  upV  A.  Because  I  want- 
ed him  to  sell  those  ditchers,  so  that  I  could 
make  a  little  money.  That  is  what  I  did  it 
for."  Further  on,  he  testified  as  follows: 
"Q.  And  you  assisted  Coffin  all  the  way 
through  the  negotiations?  A.  No;  I  don't 
tiiink  I  did,  all  the  way.  Q.  Did  you  hear 
anything,  or  all  that  was  said,  on  that  day, 
in  relation  to  the  sale  of  those  ditchers  to 
Jessop?  A.  I  don't  know  whether  I  did 
or  not.  The  sale  was  not  consummated  in 
my  presence.  Q.  Then  the  sale  was  not  con- 
summated \mtil  Sherman  Coffin  came  up? 
A.  No,  sir.  It  might  have  been  at  that  time, 
but  I  don't  remember.  Q.  And  Jes.sop  was 
in  Utah?  A.  Jessop  was  in  Utah."  This  evi- 
dence needs  no  comment.  It  is  too  plain 
to  be  misconstrued,  or  misunderstood.  It 
clearly  shows  that  no  contract  or  bargain  for 
the  sale  of  tlie  machines  was  made  between 
Jessop  and  Stearns,  and  that,  if  any  bar- 
gain was  made,  it  was  made  between  Cof- 
fin and  Bray,  at  a  time  when  Jessop  was  in 
Utah.  Sherman  Coffin  testified  that  no  sale 
was  made  until  he  met  Bray  at  Nampa,  in 
response  to  a  dispatch  from  Stearns.  He 
also  testified  that  he  never  met  Jessop  until 
the  ditchers  arrived  at  Nampa;  that  John 
M.  Bray  was  the  man  who  gave  the  order 
for  the  ditchers,  and  who  agreed  to  pay  for 
them  as  a  member  of  the  firm  of  Bradbury 
&  Bray.  This  was  denied  by  Mr.  Bray.  He 
denied  that  he  made  any  contract  for  the 
purchase  of  said  machines,  and  denied  that 
he  had  any  authority  from  Jessop  to  pur- 
chase said  machines.  He  testified  as  fol- 
lows, to  wit:  "I  says:  'No,  sir,  Mr.  Coffin;  I 
will  have  nothing  to  do  with  those  machines, 
whatever.  I  have  no  authority  to  buy  ma- 
chines for  Jessop.'  *  *  *"  This  evidence  shows 
that  Bray  did  not  purchase  them  for  Jessop. 
Mr.  Bray  also  testified  to  a  conversation, 
alleged  to  have  been  had  with  Frank  II.  Cof- 
fin, about  the  middle  of  May,  1890,  in  which 
he  stated  to  Coffin  that  he  had  nothing  to  do 
with  the  machines  whatever;  "that  the  en- 
tire sale  of  those  machines  was  between 
Sherman  Coffin,  Stearns,  and  Jessop."  The 
testimony  of  Stearns  shows  that  he  had  a 
conversation  with  Jessop,  in  regard  to  ditch- 
ing machines,  in  the  presence  of  J.  M.  Bray, 
a  day  or  two  before  Sherman  Coffin  met 
Bray;  that  thereafter  Jessop  left  Nampa  for 
T'tah,  and  Stearns  telephoned  Coffin  to  come 
to  Nampa,  and,  on  his  arrival,  introduced 
him  to  J.  M.  Bray  a.s  the  man  who  coidd 
talk  with  him  about  those  ditchers,  and  the 
evidence  shows  that  they  did  talk  about 
ditchers.  It  may  b<»  true,  as  testified  by  Mr. 
Bray,  that  he  then  and  thcn-o  informed  Sher- 
man Coffin  that  he  would  have  nothing  to  do 
with  the  machines,  whatever,  and  that  he 
had   no  authority   to   pm-chase  niachines   for 


Jessop;  but,  regardless  of  those  statements, 
the  testimony  tends  to  show  he  did  have 
some  conversation  about  them,  and  author- 
ized Sherman  Coffin  to  have  them  shipped  in 
the  name  of  Bradbury  &  Bray,  and  after- 
wards requested  Coffin  to  not  have  them 
shipped  in  said  firm's  name.  Coffin  testified 
that  the  contract  was  made  with  Bray. 
Stearns'  testimony  is  to  the  same  effect. 
Bray  testified  that  it  was  made  between 
Stearns,  Coffin,  and  Jes.sop.  And  from  this 
coufiicting  evidence,  and  other  evidence,  the 
jury  found  against  appellants.  The  testi- 
mony of  Charles  Stewart  tends  to  corrobo- 
rate the  testimony  of  Sherman  M.  Coffin. 
He  testified  as  follows:  "I  rode  up  to  Bray, 
who  was  out  on  the  ditch,  where  Jessop's 
contract  was.  I  rode  up  to  Bray,  and  I 
think  he  wasn't  using  very  good  language 
towards  Jessop,  because  Jes.sop  was  getting 
behind.  He  says,  'I  am  in  the  soup  with 
Coffin  Bros,  for  those  damned  ditchers.' " 
This  testimony  is  not  contradicted.  D.  H. 
Birdsall,  a  witness  for  respondents,  testified 
that  he  met  Bray,  at  Nampa,  between  May 
27  and  30,  1S90,  and  had  some  conversation 
with  him  about  selling  him  safety  nitro  pow- 
der, and  he  informed  Bray  that  Coffin  Bros, 
were  agents  for  said  powder,  and  would  sup- 
ply Bray  with  said  powder.  Bray  thereupon 
informed  Birdsall  that  he  had  some  difficulty 
with  Coffin  Bros.,  and  did  not  care  to  deal 
with  them.  After  some  further  conversa- 
tion, Birdsall  informed  Bray  that  he  was  go- 
ing to  Caldwell  to  see  Sherman  M.  Coffin, 
and  Bray  thereupon  requested  him  to  say 
to  Coffin  that  he  (Bray)  did  not  wish  to  have 
any  trouble  with  him,  (Sherman  M.  Coffin,) 
and  that  he  would  see  that  they  (Coffin  Bros.) 
were  paid  for  the  ditchers.  This  testimony 
is  contradicted  by  Bray.  Bird.sall  and  Stew- 
art were  disinterested  witnesses,  and  the 
jury  no  doubt  gave  some  weight  to  their  tes- 
timony, as  corroborating  that  of  Sherman  M. 
Coffin.  But  it  is  urged  by  appellants  that, 
if  said  statements  were  made  by  Bray,  they 
would  be  perfectly  consistent  with  the  theory 
that  Bradbury  &  Bray  were  only  guarantors, 
and  not  pm'chasers.  There  might  be  some 
point  in  this  contention  if  J.  M.  Bray  admit- 
ted that  he  was  simply  guarantor;  but  he 
denies  that  they  were  guai-antors,  and  there 
is  no  evidence  tending  to  show  that  they 
were,  except  that  contained  in  the  letter 
written  by  Sherman  M.  Coffin  to  J.  M.  Bray, 
dated  May  24,  1S90.  If  the  defense  in  this 
suit  had  been,  that  appellants  were  guaran- 
tors, and  not  liable  because  such  guaranty 
was  not  in  writing,  then  the  contention  of 
appellants  would  be  of  some  weight;  but,  as 
that  is  denied,  and  the  issue  was  as  to  wheth- 
er the  appellants  were  original  purchasers, 
the  evidence  of  Stewart  and  Birdsall  tends 
to  corroborate  the  testimony  of  respondents 
on  that  issue.  The  issue  as  to  whether 
Bradbm-y  &  Bray  were  simply  guarantors  is 
not  in  this  case.  It  would  appear  that  said 
statements   were   made  by   Bray   to   Stewart 


STATUTE  OF  FRAUDS. 


439 


aud  Birdsall,  not  upon  the  theory  that  Brad- 
bury &  Bray  were  guarantors,  but  upon  the 
Ihoory  that  they  were  purchasers.  C.  W. 
.Nfoore's  testimony  also  corroborates  Sher- 
man M.  Cofiin,  as  to  the  sale.  He  testitied 
that  he  had  no  knowledge  of  the  sale  of  any 
goods  at  the  time  a  certain  telegram  was 
sent,  except  the  ditchers  to  Bradbury  & 
Bray.  By  what  means  the  witness  became 
possessed  of  that  knowledge,  the  record  fails 
to  disclose.  The  testimony  of  Slierman  M. 
Coffin  and  Mr.  Bray  is  so  unsatisfactory,  and 
conflicting  in  substantial  matters,  that  it  is 
impossible  for  this  court  to  say  how  much  of 
said  testimonj'  is  true,  and  how  much  is 
false,  and,  as  the  jury  are  the  exclusive 
judges  of  the  weight  to  be  given  to  the  tes- 
timony of  any  witness  or  witnesses,  and  they 
having  found  on  the  purchase,  delivery,  and 
acceptance  of  the  machines,  this  court,  un- 
der the  conditions,  would  not  be  justified  in 
disturbing  the  verdict. 

Appellants  contend  that  the  court  erred  in 
permitting  Sherman  M.  Coffin  and  Frank  R. 
Coffin  to  testify  in  regard  to  a  certain  tele- 
phone message,  sent  by  the  former  to  the  lat- 
ter, inquiring  as  to  the  responsibility  of  ap- 
pellants. The  evidence  shows  that,  on  the 
day  the  ditchers  in  controversy  were  or- 
dered, Sherman  M.  Coffin  waited  at  Nampa, 
for  a  reply  to  a  telegram  sent  to  Jessop,  un- 
til late  in  the  day;  that  he  finally  informed 
Mr.  Bray  that  he  must  return  to  his  home,  at 
Caldwell,  some  nine  or  ten  miles  from  Nam- 
pa; that  thereupon  Bray  requested  him  to 
order  five  ditchers,  and  stated  that,  if  Jes.sop 
could  not  use  the  fifth  ditcher,  Bradbury  & 
Bray  would  use  it  themselves;  tliat  witness 
got  his  team,  and  drove  to  his  home,  at  Cald- 
well, and  put  his  team  out,  and  immediately 
thereafter,  and  before  ordering  said  machines 
from  Chicago,  he  telephoned  his  partner, 
Frank  R.  Coffin,  at  Boise  City,  and  asked 
him  if  Bj-adbury  &  Bray  were  good  for  five 
ditchers,  at  $1,100  each,  and  requested  him 
to  find  out,  and  let  him  know;  that  this  all 
occurred  within  two  hours  after  he  left  Nam- 
pa. Tills  telephone  communication,  and 
Frank  R.  Coffin's  testimony  in  regard  to  re- 
ceiving the  same,  was  objected  to,  and  the 
admi.ssion  tlu-roof  is  a.ssigned  as  error.  It  is 
urged  tliat  tlie  same  is  no  part  of  the  res 
gestae,  that  it  took  phice  after  the  agree- 
ment for  the  sale  of  the  ditchers  had  been 
entered  into,  and  was  a  communication  from 
one  of  the  plaintiffs  to  his  partner,  and  not 
in  the  presence  of  the  defentlants,  or  either 
of  them;  that  said  testimony  is  self-serving, 
and  too  remote  to  be  a  part  of  the  res  ges- 
tae. Counsel  for  appellants  contend  that 
the  rule  applicable  to  this  class  of  testimony 
is,  that  such  declarations,  to  become  compe- 
tent evidence,  as  part  of  the  res  gestae,  must 
accompany  the  act  which  they  are  supposed 
to  characterize,  and  nmst  so  harmonize  with 
it  as  to  be,  obviou.sly,  a  part  of  the  same 
tran.saction.  and  in  support  of  this  rule  cite: 
Moore  v.  Meacham,  10  N.    Y.  207;    Enos  v. 


Tuttle,  3  Conn.  250;  Cherry  v.  Butler,  (Tex. 
App.)  17  S.  W.  1090;  Tisch  v.  Utz,  (Pa.  Sup.) 
21  Atl.  SOS;  Conlan  v.  (Irace,  (Minn.)  30  N. 
W.  880;  1  Whart.  Ev.  §  205;  2  Whart.  Ev. 
§  1174;  Dawson  v.  Pogue,  (Or.)  22  Pac.  640; 
State  v.  Daugherty,  17  Nev.  370.  30  Pac.  1074; 
People  V.  Dewey,  (Idaho,)  G  Pac.  103;  Binns 
V.  State,  ru  Ind.  4G.  In  Moore  v.  Meacham, 
supra,  the  court,  in  pa.ssing  upon  the  question 
of  the  admission  of  certain  declarations,  said 
that  "the  general  rule  is  that  declarations, 
to  become  a  part  of  the  res  gestae,  must  ac- 
company the  act  which  they  are  supposed  to 
characterize,  and  must  so  harmonize  as  to  be 
obviously  one  transaction,"— and  held  that 
the  general  rule  applicable  to  the  admi.ssion 
of  such  declarations,  as  a  part  of  the  res 
gestae,  was  the  rule  which  should  govern  in 
that  case.  Enos  v.  Tuttle,  supra,  was  a  case 
where  a  plaintiff  undertook  to  introduce  dec- 
larations of  an  absconding'  debtor  as  evi- 
dence against  a  garnishee,  and  the  court  hela 
that  such  declarations  were  not  evidence  for 
the  plaintiff.  Cherry  v.  Butler,  supra,  held 
the  declarations  of  payee  on  draft,  narrating 
the  fact  that  he  had  twice  paid  it,  were  selt- 
serving,  and  error  to  admit  them.  In  Tisch 
V.  Utz,  (Pa.  Sup.)  21  Atl.  808,  it  was  held  that 
declarations  of  a  judgment  debtor  wore  noi 
admissible  in  evidence  for  the  purpose  of  im- 
peaching the  judgment.  In  Conlan  v.  Grace, 
(Minn.)  30  N.  W.  880,  it  is  held  that  "declara- 
tions of  a  party,  to  be  admissible  as  a  pan 
of  the  res  gestae,  must  be  contemporaneous 
with,  or  at  least  so  connected  with,  the  main 
fact  in  issue  as  to  constitute  one  transaction." 
Dawson  v.  Pogue,  (Or.)  22  Pac.  040.  holds: 
"Ordinarily,  acts  and  declarations  of  parties 
to  an  action  are  not  competent  evidence  in 
their  behalf.  There  are,  however,  exceptions 
to  the  rule."  State  v.  Daugherty,  supra, 
holds:  "It  is  impossible  to  tie  down  to  time 
the  rule  as  to  declarations.  We  must  judge 
from  all  the' circumstances  of  the  case.  "We 
need  not  go  to  the  length  of  saying  that  a 
declaration  made  a  month  after  the  fact 
would,  of  itself,  be  admissible,  but  if,  as  in 
the  lu-esent  case,  there  are  connecting  cir- 
cumstances, it  may,  even  at  that  time,  form 
part  of  the  whole  res  gestae."  and  that  the 
declaration  was  simply  a  narration  of  past 
events  or  occurrences,  and  was  incompetent. 
In  1  Whart.  Ev.  §  205,  it  is  held  that  such 
declarations  are  inadmissible,  if  made  so  far 
prior  to  the  act  sought  to  be  characterized 
as  to  give  opportunity  for  their  correction  in 
way  of  preparation,  or,  if  made  so  long  after- 
wards, as  to  leave  an  interval— which  inter- 
val should  not  be  measured  by  time,  but  bj 
(lie  circumstances  of  the  casc^ — in  wliicii  ex- 
cu.ses,  explanations,  or  aggravations  coiUd  be 
got  up.  2  Whart.  Ev.  §  1174,  is  applicable 
to  the  admissions  of  agents  in  matters  of 
tort,  and  not  in  point.  Binns  v.  State,  supra, 
holds  that  "a  declaration  which  is  simply  a 
narrative  of  past  events  ♦  ♦  *  i^  inadmis- 
sible in  evidence." 
The  authorities  cited  state  the  general  rule 


440 


STATUTE  OF  FRAUDS. 


applicable  to  the  admission  of  dcH-larations 
luailo  bj'  a  party,  as  ovidonoe  in  his  own  be- 
half, and  some  of  them  recognize  that  there 
are  except iuns  to  the  general  rule.  In  some 
of  them  time  is  considered  a  controlling  ele- 
ment, and  in  others,  not.  They  hold  that 
such  declarations,  to  become  competent  evi- 
dence for  the  party  making  them,  must  be  a 
part  of  the  res  gestae,  or  at  least  so  consid- 
orcHi.  The  term  "res  gestae"  is  used  in  one 
class  of  cases  to  indicate  the  very  matter  in 
issue,  the  ultimate  thing  itself,  the  thing  con- 
troverted; and  in  others  the  term  is  used  to 
indicate  the  surrounding  facts  of  a  transac- 
tion, which  explain  or  characterize  the  main 
fact.  In  1  Greenl.  Ev.  §  108,  it  is  held  that 
the  surrounding  circumstances,  constituting 
parts  of  the  res  gestae,  may  always  be  shown 
to  the  jury,  along  with  the  principal  fact, 
and  their  admissibility  is  determined  by  the 
judge,  according  to  the  degree  of  their  rela- 
tion to  that  fact,  and  in  the  exercise  of  his 
sound  discretion.  Whether  declarations  made 
after  the  occurrence  of  the  litigated  issue 
should  be  admitted  as  evidence  in  behalf  of 
the  party  making  them,  rests  in  the  sound 
judicial  discretion  of  the  court.  O'Connor  v. 
Railway  Co.,  27  Minn.  ITd,  6  N.  W.  481; 
State  V.  Ah  Loi,  5  Nev.  82;  1  Greenl.  Ev.  § 
108.  In  1  Tayl.  Ev.  §§  52.5,  526,  it  is  stated 
that  "in  all  these  cases,  the  principal  points 
of  attention  are,  whether  the  circumstances 
and  declarations  offered  in  proof  were  so 
connected  with  the  main  fact  under  consid- 
eration, as  to  illustrate  its  character,  to  fur- 
ther its  object,  or  to  form,  in  conjunction 
with  it,  one  continuous  transaction.  It  was, 
at  one  time,  thought  necessary  that  they 
should  be  contemporaneous  with  it,  but  this 
docti'ine  has  of  late  years  been  rejected,  and 
it  seems  now  to  be  decided  that,  although 
concurrence  of  time  must  always  be  consid- 
ered as  material  evidence  to  show  the  con- 
nection, it  is  by  no  means  essential.  *  *  *" 
In  Insurance  Co.  v.  Mosley,  H  Wall.  307, 
which  was  an  action  on  an  accident  insur- 
ance policy,  the  declarations  of  the  deceased 
as  to  the  cause  of  the  injury  from  which  he 
died,  made  shortly  after  the  injury,  was  held 
competent  evidence,  and  a  part  of  the  res 
ge.stae.  The  court,  speaking  through  Mr. 
Justice  Swayne,  in  regard  to  certain  declara- 
tions being  part  of  the  res  gestae,  says:  "To 
bring  such  declarations  within  this  principle, 
generally,  they  must  be  contemporaneous 
with  the  main  fact  to  which  they  relate,  but 
this  rule  is  by  no  means  of  universal  applica- 
tion,"— and  quotes  with  approval  from  Raw- 
son  V.  Haigh,  2  Bing.  i)9,  as  follows:  "It  is 
impossible  to  tie  down  to  time  the  rule 
as  to  such  declarations.  We  must  judge 
from  all  tJie  circumstances  of  the  case.  We 
need  not  go  to  the  length  of  saying  that  a 
declaration  made  a  month  after  the  fact 
would,  of  itself,  be  admissible;  but  if,  as  in 
the  present  case,  there  are  connecting  cir- 
cumstances, it  may,  even  at  that  time,  form 
a  part  of  the  whole  res  gestae."     Referring 


to  the  doctrine  applicable  to  the  admission  of 
such  declarations,  the  court  says:  "The 
tendency  of  recent  adjudication  is  to  extend, 
rather  than  to  narrow,  the  scope  of  the  doc- 
trine." "Riglitly  guarded  in  its  application, 
there  is  no  principle  in  the  law  of  evidence 
more  safe  in  its  results.  There  is  none  which 
rests  on  a  more  solid  basis  of  reason  and  au- 
thority." In  Board  v.  Keenan,  55  Cal.  G42, 
Justice  McKee,  in  delivering  the  opinion  of  the 
court,  said:  "Wharton  detines  res  gestae  as 
those  circumstances  which  are  the  uude.signeQ 
incidents  of  a  particular  litigated  act.  These 
incidents  may  be  separated  from  the  act,  by 
a  lapse  of  time  more  or  less  appreciable. 
They  may  consist  of  speeches  of  any  one  con- 
cerued,  whether  participant  or  bystander; 
they  may  comprise  things  left  undone,  as 
well  as  things  done.  Their  sole  distinguish- 
j  ing  feature  is  that  they  should  be  necessary 
incidents  of  the  litigated  act;  necessary  in 
this  sense,  that  they  are  part  of  the  imme- 
diate preparations  for,  or  emanations  of,  such 
act,  and  are  not  produced  by  the  calculated 
policy  of  the  actors."  In  People  v.  Vernon, 
35  Cal.  49,  it  is  held  that  "declarations,  to  be 
a  part  of  the  res  gestae,  are  not  required  to 
be  precisely  concurrent  in  point  of  time  with 
the  principal  fact.  If  they  spring  out  of  the 
principal  transaction,  if  they  tend  to  explain 
it,  are  vohmtary  and  spontaneous,  and  are 
made  at  a  time  so  near  it  as  to  preclude  the 
idea  of  deliberate  design,  then  they  are  to 
be  regarded  as  contemporaneous,  and  admis- 
sible." See,  also.  State  v.  Horan,  (Minn.)  20 
N.  W.  905;  Augusta  Factory  v.  Barnes,  .53 
Amer.  Rep.  838;  Insurance  Co.  v.  De  Wolf, 
8  Pick.  5G;  State  v.  Jones,  (Iowa,)  17  N.  W. 
911;  State  y.  Ah  Loi,  5  Nev.  82;  Ross  v. 
Bank,  15  Amer.  Dec.  664.  In  Milne  v.  Leis- 
ler,  7  Hurl.  &  \.  786,  it  was  held  competent 
for  the  plaintiff,  for  the  purpose  of  proving 
upon  whose  credit  goods  sued  for  were  sold, 
to  introduce  in  evidence  a  certain  letter, 
written  by  plaintiff"  to  his  agent,  requesting 
him  to  inquire,  as  to  the  financial  standing 
of  the  defendant,  of  a  person  to  whom  the 
person  receiving  the  goods  had  referred  him 
for  that  purpose.  The  plaintiff  stated  in 
said  letter  that  the  defendant  was  the  pur- 
chaser of  said  goods.  And  it  was  further 
held  that  the  jury  might  look  at  the  whole 
letter,  and  although,  in  itself,  it  was  not  evi- 
dence of  the  truth  of  the  facts  st^ated.  it 
might  be  considered  as  corroborative  of  plain- 
tiff's version  of  the  transaction.  1  Greenl. 
Ev.  (Redtield's  Ed.)  §  108a.  In  Bouvier's 
Law  Dictionary,  (Ed.  1888,)  under  the  head 
of  res  gestae,  the  following  statement  occurs: 
"In  the  United  States  the  tendency  is  to  ex- 
tend, rather  than  narrow,  the  scope  of  the 
doctrine  of  res  gestae.  Although,  generally, 
the  declarations  must  be  contemporaneous 
with  the  event  sought  to  be  proved,  yet, 
where  there  are  connecting  circumstances, 
they  may,  even  when  made  some  time  after- 
wards, form  a  part  of  the  res  gestae.  In- 
surance Co.  V.  Mosley,  8  Wall.  397;   Railroad 


STATUTE  OF  FRAUDS. 


441 


Co.  V.  Coyle,  55  Pa.  St.  402;  llarrinian  v. 
Stowe,  57  Mo.  93;  Brownell  v.  Kailroad  Co., 
47  Mo.  239;  Com.  v.  Eastman,  1  Cush.  I.s9. 
And,  in  England,  the  do(;ision  of  Cockburn, 
C.  J.,  in  Bedinfjtifld's  Case,  14  Cox,  Crim. 
Cas.  341,  is  directly  contrary,  lidding  tliat 
tlie  declarations  must  be  contemporaneous 
with  the  event,  to  be  admissible.  This  deci- 
sion has  been  vigorously  opposed  by  Mi-. 
Taylor  and  others.  See  14  Amer.  Law  Ilev. 
817;  15  Amer.  Law  Rev.  1,  71;  Field  v. 
State,  34  Amer.  Rep.  479."  From  a  review 
of  the  autliorities,  I  tliinlv  the  decided  weight 
is  that  time  is  not  necessarily  a  controlling 
element  or  principle  in  the  matter  of  res  ges- 
tae, and  that  declarations  made,  under  cir- 
cumstances to  warrant  the  court  in  presuming 
that  they  grew  out  of  the  litigated  issue,  and 
illustrate  the  true  character  of  the  transac- 
tion, and  were  dependent  upon  it,  were  not 
designedly  made,  or  devised  for  a  self-serving 
purpose,  are  evidentiary  facts,  and  are  not 
within  the  general  rule  applicable  to  hearsay 
testimony.  Such  declarations  are  admissible, 
although  not  made  at  the  exact  time  of  the 
occurrence  of  tlie  principal  fact  in  issue.  1 
think  the  evidence  referred  to  comes  within 
the  rule  laid  down  in  many  of  the  authorities 
above  cited.  The  declaration  or  communica- 
tion was  not  a  narrative  of  past  events,  or 
of  tlie  contract  of  sale.  It  was  an  inquiry, 
which  any  prudent  business  man  would  nat- 
urally make,  before  he  would  feel  safe  in 
ordering  upwards  of  $G,()()0  worth  of  ma- 
chinery for  a  customer  whose  financial  con- 
dition was  not  known  to  him.  He  would 
very  naturally  want  to  know  the  ability  of 
the  purchaser  to  pay.  It  is  true  the  order 
for  the  ditchers  had  been  given  and  received 
iRome  two  hours  before  the  inquiry  under  con- 
sideration was  made,  but  it  was  made  before 
the  ditcliers  were  ordered,  and,  as  I  view  it, 
was  made  in  the  midst  of  the  transaction,  and 
before  all  the  conditions  were  performed 
which  were  required  to  be  performed,  before 
the  contract  became  binding  upon  either  party. 
It  was  a  pertinent  inquiry,  and  I  think  it  one 
of  the  reasonable  emanations  arising  out  of 
the  contract  of  purchase,  and  dependent  up- 
on it,  that  it  was  not  deliberately  devised  or 
contrived  by  the  parties,  for  a  self-serving 
purpose,  that  it  was  spontaneously,  and  not 
designedly,  made,  and  tends  to  explain  to 
whom  the  credit  was  given.  Its  trutli  or 
falsity  wavS  for  the  jury.  The  question  liti- 
gated was,  whether  the  ditchers  were  sold  to 
Bradbury  &  Bray,  and  on  their  credit.  Bray 
testified  that  they  were  st)ld  to  Jessop.  and 
he  alone  became  liable  for  ti.  -  paynu^nt  of 
the  purcliase  price,  while  Sherman  M.  Coflin 
testified  that  they  were  sold  to  Bi-adbury  «& 
Bray,  and  on  their  credit.  1  think  the  testi- 
mony under  consideration  tends  to  show  to 
whom  the  credit  was  given,  and  was  prop- 
erly admitted. 

Error  isf  alleged  because  the  court  held 
that,  under  the  evidence,  no  partnership,  for 
the  sale  of  said   machines,   existed    between 


Stearns  and  Sherman  M.  Coffin.  Appellants 
undertook  to  show  that  there  was  a  partner- 
ship between  Stearns  and  Coffin,  in  the  sale 
of  said  ditchers.  Stearns  and  Coffin  both  tes- 
tify that  no  such  partnership  existed,  and 
there  is  not  a  scintilla  of  evidence  tending  to 
show  a  partnership.  That  being  true,  it  was 
not  prejudicial  error  for  the  court  to  so  hold. 

The  foiu-th  error  a.ssigned  is  that  the  court 
erred  in  admitting  the  testimony  of  Sherman 
M.  Coffin,  in  explanation  of  tlie  svnse  in 
which  he  used  the  word  "guaranty"  in  his 
letter  of  May  24,  1890,  to  John  M.  Bray. 
The  letter  was  introduced  as  an  a<lmission 
of  said  respondent,  to  show  that,  at  the  time 
of  writing  it,  he  considered  Bradl)ury  &  Bray 
as  guarantors,  and  not  as  original  purchasers. 
Under  this  contention,  api)ellants  cite  several 
authorities  upon  the  proposition  that,  when 
the  language  of  a  written  contract  is  neither 
ambiguous  nor  technical,  parol  evidence  is 
not  received  to  explain  it.  These  authorities 
are  not  in  point,  for  the  reason  that  said  let- 
tor  is  not  a  written  contract,  nor  a  part  of 
one.  I  understand  the  rule  to  be  that,  when 
a  writing  is  introduced  as  an  admission,  and 
not  as  a  part  of  the  contract  between  the 
parties,  it  is  always  perniissil)le  for  the  party 
who  wrote  it,  and  against  whom  it  was  in- 
troduced, to  explain  the  meaning  that  he  in- 
tended to  convey.  The  rule  applicable  to 
oral  admissions  is  the  proper  one  to  be  ap- 
plied to  the  evidence  under  consideration. 
Duncan  v.  Matney,  77  Amer.  Dck;.  575; 
Smith  V.  Crego,  54  Hun,  22,  7  N.  Y.  Supp.  SG; 
Bingham  v.  Bernard,  (INIinn.)  30  N.  AV.  404; 
Auzerais  v.  Naglee,  (Cal.)  15  Pac.  371;  Browne, 
Parol  Ev.  §  6;  Morris  v.  Railroad  Co.,  21 
Minn.  91;  Burke  v.  Ray,  (Minn.)  41  N.  W. 
210. 

Tlie  fifth  error  assigned  is  the  refusal  of  the 
court  to  strike  out  that  portion  of  Sherman 
M.  Coffin's  testimony  in  explanation  of  the 
word  "guaranty,"  to  wit:  "We  have  dozens 
of  entries  in  our  boolvs,  at  this  time,  which 
could  show  tliat  fact."  We  cannot  consider 
this  objection,  for  the  reason  that  no  excep- 
tion appears  to  have  been  saved  in  the  court 
below. 

The  sixth  error  assigned  is  that  the  coiu't 
erred  in  permitting  Charles  Stewart,  a  wit- 
ness on  behalf  of  plaintiff,  to  testify  as  fol- 
lows: "I  rode  up  to  Bray,  who  was  out  on 
the  ditch,  where  Jessop's  contract  was.  I 
rode  up  to  Bray,  and  think  he  wasn't  using 
very  good  language  towards  .Tessop,  because 
Jessop  was  getting  behind.  He  says,  'I  am 
in  the  soup  with  Coffin  Bros,  for  those  damn- 
ed ditchers.'  "  Appellants  contend,  (1)  that, 
if  this  evidence  was  introduced  for  the  pur- 
pose of  establishing  plaintiffs'  case,  as  an  ad- 
mission of  the  contract  sneil  on.  it  should 
have  been  introduced  as  a  part  of  the  testi- 
mony in  chief,  and  not  in  rebuttal;  (2)  if  it 
was  introduced  to  impeach  Bray,  it  was  er- 
ror to  admit  it.  for  the  reason  that  Bray's  at- 
tention was  not  called  to  it  when  he  was  on 
the  witness  stand.    The  first  objection  does 


442 


STATUTE  OF  FRAUDS. 


not  appear  to  have  bi^eu  taken  in  the  court 
below,  and  cannot  be  considered  for  that  rea- 
son. Tlie  second  is  not  well  taken,  for  the 
reason  that  statements  and  admissions,  made 
by  a  party  to  a  suit,  may  be  proved  without 
-first  calling  the  party's  attention  to  them. 
The  rule  that  the  attention  of  the  witness 
nuist  l>e  callel  to  the  statement  made,  and 
the  time  and  place  of  makins  the  same,  in 
Older  to  lay  the  proper  foundation  for  im- 
peachment, does  not  apply  to  this  case.  1 
Thomp.  Trials,  §  4!)7;  Collins  v.  Mack,  33 
Ark.  (iS;j,  G94;    Lucas  v.  Flinn.  35  Iowa,  9. 

After  a  careful  review  of  all  the  evidence. 
I  find  a  substantial  conflict  on  the  material 
issues,  and,  where  the  material  issues  are 
submitted  to  the  jm-y.  on  instructions  of  the 
com-t  not  excepted  to  by  appellants,  the  ver- 
dict of  the  jm-y  will  not  be  disturbed  by  the 
apiKjllate  com-t;    nor  will  the  order  overrul- 


ing a  motion  for  a  new  trial  be  reversed,  on 
the  ground  of  insufficiency  of  the  evidence 
to  justify  the  verdict,  when  there  is  a  sub- 
stantial conflict  in  the  evidence.  Ainslie  v. 
Printing  Co.,  1  Idaho,  641;  Du  Brutz  v.  Jes- 
sup,  54  Cal.  118;  Campe  v.  Meierdiercks,  87 
Cal.  290,  25  Pac.  419;  Lynch  v.  Welby,  87 
Cal.  441,  25  Pac.  584;  Garrard  v.  White, 
(Ky.)  14  S.  W.  9GG;  Ketcham  v.  Barbour, 
(Ind.  Sup.)  26  N.  E.  127. 

I  find  no  reversible  error  in  the  record. 
The  judgment  of  the  court  below  is  affirmed, 
with  costs  of  this  appeal  in  favor  of  re- 
spondents. 

HUSTON,  C.  J.,  took  no  part  in  the  hear- 
ing or  decision  of  this  case. 

MORGAN,  J.,  concurs  in  the  result. 


STATUTE  OF  FRAUDS. 


443 


CAULKINS  V.  IIELLMAN. 
(47   N.    i:.   44D.) 
Court  of   Appeals   of   New   York.     1872. 
Action    to    recover    for    wiues    and    casks 
sold. 

Stephen  K.  Williams,  for  appellant.  E.  G. 
Latham,  for  respondents. 

RAPALLO,  J.  The  instructions  to  Ihe 
jury  as  to  the  legal  effect  of  the  delivery 
of  the  w^ine  at  Blood's  Station  in  coulorni- 
ity  with  the  terms  of  the  verbal  contract 
of  sale  were  clearly  erroneous.  No  act  of 
the  vendor  alone,  in  performance  of  a  con- 
tract of  sale  void  by  the  statute  of  frauds, 
can  give  validity  to  such  a  contract. 

Where  a  valid  contract  of  sale  is  made 
in  writing  a  delivery  pursuant  to  such  con- 
tract at  the  place  agreed  ujjon  for  deliv- 
ery, or  a  shipment  of  the  goods  in  con- 
formity with  the  terms  of  the  contract,  will 
pass  the  title  to  the  vendee  without  any 
receipt  or  acce]3tance  of  the  goods  by  him. 
But  if  the  contract  is  oral,  and  no  part 
of  the  price  is  paid  by  the  vendee,  there 
must  be  not  only  a  delivery  of  the  goods 
by  the  vendor,  but  a  receipt  and  accept- 
ance of  them  by  the  vendee  to  pass  the 
title  or  make  the  vendee  liable  for  the 
price;  and  this  acceptance  must  be  volun- 
tary and  uncondilioual.  Even  the  receipt 
of  the  goods,  without  an  acceptance,  is  not 
sufficient.  Some  act  or  conduct  on  the  imrt 
of  the  vendee,  or  his  authorized  agent,  man- 
ifesting an  intention  to  accept  the  goods 
as  a  performance  of  the  contract,  and  to 
appropriate  them,  is  required  to  supply  the 
place  of  a  written  contract.  This  distinc- 
tion seems  to  have  been  overlooked  in  tne 
charge.  The  learned  judge  instructed  the 
jury,  as  a  matter  of  law,  that  if  they  were 
satisfied  that  the  wine  or  any  portion  of  it 
was  actually  delivered  in  pursuance  of  the 
verbal  contract,  that  circumstance  was  suf- 
ficient to  take  the  contract  out  of  the 
statute  of  frauds,  and  the  contract  was  a 
valid  one,  and  might  be  enforced  notwith- 
standing it  was  not  in  writing.  The  at- 
tention of  the  jury  was  directed  to  the  in- 
quiry whether  the  plaintiffs  had  faithfully 
performed  their  part  of  the  contract  rather 
than  to  the  action  of  the  defendant,  and  the 
judge  proceeded  to  state  that  if  the  wine 
was  delivered  to  the  express  company  at 
Blood's  Station  in  good  order,  in  merchant- 
able condition,  and  corresponded  in  'qual- 
ity and  all  substantial  and  material  respects 
with  the  samples,  then  he  instructed  the 
jury  as  a  matter  of  law,  that  if  they  found 
the  contract  as  Gordon  testified  with  re- 
spect to  the  place  of  delivery,  that  was  a 
complete  delivery  under  the  contract,  and 
passed  the  title  from  the  plaintiffs  to  the 
defendant,  and  the  plaintiffs  were  entitled 
to  recover  the  contract  price  of  the  wines. 

The  plaintiff's  counsel  suggests  in  the 
statement  of  facts  appended  to  his   points. 


that  Gordon  was  the  .iiient  of  the  defend- 
ant, to  accept  the  goods  at  Blood's  Station. 
But  this  statement  is  not  bornt'  out  by 
the  evidence;  Gordon  was  the  agent  of  the 
plaintifL's  for  the  sale  of  the  goods;  it  was 
incimibent  upon  them  to  make  the  ship- 
ment. All  that  Gordon  testifies  to  is  that 
the  defendant  requested  him  to  make  the 
best  bargain  he  could  for  the  freight.  He 
does  not  claim  that  he  had  any  authority 
to  accept  the  goods  for  the  defend;! nt. 

According  to  the  defendant's  testimony 
Gordon  clearly  had  no  such  authority,  nor 
did  the  defendant  designate  any  convey- 
ance, and  the  judge  submitted  no  question 
to  the  jury  as  to  the  authoritj'  eitlier  of 
Gordon  or  the  express  company  to  accept 
the  goods.  On  the  contrary,  he  rei)eated 
that  if  when  the  wine  was  delivered  at 
Blood's  Station  it  was  in  good  order  and 
corresponded  with  the  samples,  the  plain- 
tiffs would  be  entitled  to  a  verdict  for  the 
contitvct  price,  upon  the  ground  that  the 
parties  by  the  contract  (assuming  it  to  be 
as  claimed  by  the  plaintiffs),  fixed  upon 
that  station  as  the  place  of  delivery;  'that 
it  was  true  that  the  defendant  was  not 
there  to  receive  it,  and  had  no  agent  at 
Blood's  Station  to  receive  it,  and  had  no 
opportunity  to  inspect  it  there;  but  that 
that  was  a  contingency  he  had  not  seen, 
and  which  he  might  have  guarded  against 
in  the  contract." 

It  is  evident  that  the  learned  judge  ap- 
plied to  this  case  the  rule  as  to  delivery, 
which  would  be  applicable  to  a  valid,  writ- 
ten contract  of  sale,  but  which  is  ina]i])li- 
cable  when  the  contract  is  void  by  the 
statute  of  frauds. 

The  effect  of  the  delivery  of  goods  at  a 
railway  station,  to  be  forwarded  to  the 
vendee  in  pursuance  of  the  terms  of  a 
verbal  contract  of  sale,  was  very  fully  dis- 
cussed in  the  case  of  Norman  v.  Phillips. 
14  Mees.  &  W.  277.  and  a  verdict  for  the 
plaintiff  founded  upon  such  a  delivery,  and 
upon  the  additional  fact  that  the  vendor 
sent  an  invoice  to  the  vendee,  which  he 
retained  for  several  weeks,  Avas  set  aside. 
The  English  authorities  on  the  subject  are 
reviewed  in  that  case,  and  the  American 
and  English  authorities  bearing  tipon  the 
same  question  are  also  referred  to  in  the 
late  cases  of  Rodgers  v.  Phillips.  -10  N.  Y. 
519,  and  Cross  v.  O'Donnell.  44  N.  Y.  (JC.l. 
The  latter  case  is  cited  by  the  counsel  for 
the  plaintiffs  as  an  authority  for  the  prop- 
osition that  a  delivery  to  a  designated  car- 
rier is  sutfieient  to  take  the  case  out  of 
the  statute;  but  it  does  not  so  decide.  It 
holds  only  that  the  receipt  and  acceptance 
need  not  be  simultaneous,  but  that  they 
may  take  i)lace  at  ditTerent  times,  and 
that  after  the  purchaser  had  himself  in- 
spected and  accepted  the  goods  purchased, 
the  delivery  of  them  l)y  his  direetion  to  a 
designated  carrier  was  a  good  delivery,  and 
the  carrier  was  the  agent  of  the  purchaser 


444 


STATUTE  OF  FRAUDS. 


to  receive  them.  No  question  however  aris- 
es in  the  present  case  as  to  a  delivery  to  a 
designated  carrier,  as  the  evidence  in  re- 
spect to  the  agreed  mode  of  delivery  is  con- 
flicting, and  no  question  of  acceptance  Dy 
the  carrier  as  agent  for  the  defcudaut  was 
submitted  to  the  jury. 

The  judge  submitted  to  the  jury  '.wo 
(luestions,  to  which  he  requirt,'d  specilic  an- 
sw^ers. 

1st.  Was  the  wine  delivered  at  the  rail- 
road station  at  the  time  agreed  upon  by 
the  parties,  and  was  it  then  in  all  respects 
in  good  order,  and  like  the  samples  exhib- 
ited by  the  plaintiff  to  the  defendant?  and, 

2d.  Was  the  wine  accepted  by  the  de- 
fendant after  it  reached  his  place  of  busi- 
ness in  New  York? 

The  jury  answered  both  of  these  ques- 
tions in  the  affirmative,  and  it  is  now  claim- 
ed that  the  answer  to  the  second  question 
renders  immaterial  any  error  the  judge 
may  have  committed  in  respect  to  the  ef- 
fect of  the  delivery  at  the  station. 

It  is  difficult  to  find  any  evidence  justify- 
ing the  submission  to  the  jury  of  the  sec 
ond  question;  but  no  exception  was  taken 
to  such  submission.  The  motion  for  a  non- 
suit would  have  raised  that  point,  were  it 
not  for  the  fact  that  there  was  evidence  to 
go  to  the  jury  on  the  claim  of  $52  for  bar- 
rels, and  this  precluded  a  nonsuit.  We 
think  however  that  the  error  in  the  charge 
may  have  misled  the  jury  in  passing  upon 
the  second  question;  at  all  events,  it  is  not 
impossible  that  it  should  have  done  so. 
Having  been  instructed  that  upon  the  fact 
as  they  found  it  in  respect  to  the  agree- 
ment for  a  delivery  at  Blood's  Station,  the 
title  to  the  goods  had  passed  to  the  de- 
fendant before  the  receipt  of  them  at  New 
York,  and  that  their  verdict  must  be  for 
the  plaintiffs,  they  may  have  examined  the 
question  of  his  acceptance  of  them  at  New  j 
York  with  less  scrutlnj-  than  they  would 
have  exercised  had  thej-  been  informed  that 
the  result  of  the  case  dei)ended  upon  their 
finding  on  that  question.  And  the  construc- 
tion of  the  defendant's  acts  and  language 
may,  in  some  degree,  have  been  influenced 
by  the  consideration  that  when  the  wine 
arrived  in  New  York  the  title  had,  accord- 
ing to  the  theory  on  which  the  case  was 
submitted  to  them,  passed  to  the  defend- 
ant, and  he  had  no  right  to  reject  the  wines. 
Furthermore,  we  think  the  judge  erred  in 
excluding  the  evidence  of  the  contents  of 
the  telegram  which  the  defendant  attempt- 
ed to  send  to  the  plaintiffs  immediately  up- 
on the  receipt  of  the  wine.  If,  as  was  of- 
fered to  be  shown,  it  stated  that  he  de- 
clined to  accept  the  wine,  it  was  material 
as  part  of  the  res  gestae.  A  bona  fide  at- 
tempt, immediately  on  the  receipt  and  ex- 
amination   of    the    wine,    to    communicate 


such  a  message,  was  an  act  on  his  i)art 
explaining  and  qualifying  his  conduct  in 
receiving  the  Avine  into  his  store  and  al- 
lowing it  to  remain  there.  And  even  though 
the  message  never  reached  the  i>laintiffs,  it 
bore  upon  the  (lucstion  of  acceptance  by 
the  defendant.  The  objection  to  the  evi- 
dence of  the  contents  of  the  telegram  was 
not  placed  on  the  ground  of  omission  to 
produce  the  original,  and  the  judge  in  his 
charge  instructed  the  jury  that  the  at- 
tempt to  send  this  telegram  did  not  affect 
the  plaintiffs'  rights,  for  the  reason  that  it 
was  not  shown  to  have  been  received  by 
them,  and  this  was  excepted  to.  In  Norman 
v.  Phillips,  14  Mees.  &.  W.  277,  the  de- 
fendant was  allowed  to  prove  that  on  being 
informed  by  the  railway  clerk  that  the 
goods  Avere  lying  for  him  at  the  station,  he 
said  he  Avould  not  take  them,  and  stress 
was  laid  upon  the  fact.  Yet  this  statement 
to  the  clerk  was  not  communicated  to  the 
plaintiffs.  Evidence  of  an  attempt  to  send 
a  message  to  them  to  the  same  effect, 
though  unsuccessful,  would  have  been  no 
more  objectionable  than  the  declaration  to 
the  clerk.  The  acts  of  the  defendant  at 
the  time  of  the  receipt  of  the  gocds.  and 
his  bona  fide  attempt  to  communicate  to 
the  plaintiffs  his  rejection  of  them  were  I 
think  material  and  competent  to  rebut  any 
presumption  of  an  acceptance  arising  from 
their  letention  bj'  him. 

The  judge  was  requested  to  instruct  the 
jury  that  the  true  meaning  of  the  defend- 
ant's letter  of  March  31  was  a  refusal  to 
accept  the  wine  under  the  contract.  A  care- 
ful examination  of  that  letter  satisfies  us 
that  the  defendant  was  entitled  to  have  the 
jury  thus  instructed.  The  letter  clearly 
shows  that  the  defendant  did  not  accept 
or  appropriate  the  wines.  After  complain- 
ing in  strong  language  of  their  quality  and 
condition,  and  of  the  time  and  manner  of 
their  shipment,  he  says  to  the  plaintiffs, 
"What  can  be  done  now  with  the  wine  after 
it  suffered  so  much,  and  shows  itself  of 
such  a  poor  quality?  I  don't  know  myself 
and  am  awaiting  your  advice  and  opinion." 
He  concludes  by  expressing  his  regret  that 
their  first  direct  ti-ansactiou  should  have 
turned  out  so  unsatisfactory,  and  by  stat- 
ing that  he  cannot  be  the  sufferer  by  it, 
and   he  awaits   their  disposition. 

This  language  clearly  indicates  an  inten- 
tion to  throw  upon  the  plaintiffs  the  re- 
sponsibility of  directing  Avhat  should  be 
done  w'ith  the  wine,  and  is  inconsistent 
with  any  acceptance  or  appropriation  of 
it  by  the  Avriter. 

For  these  reasons  the  judgment  should 
be  reversed,  and  a  new  trial  granted,  with 
costs  to  abide  the  event. 

All  concur. 

Judgment  reversed. 


STATITE  OF  FRAUDS. 


445 


POWDER  RIVER  LIVE-STOCK  CO.  v. 
LAMB. 

(50  N.  W.  1011),  38  Neb.  339.) 

Supreme  Court   of   Nebraska.      Nov.    21.    ISOo. 

Error  to  district  court,  Stanton  county; 
Powei-s,  Judye. 

Action   by    Charles   L.    Lamb   against    the    ' 
PoAvder  River  I^ive-Stock  Company.     Plain- 
tiff had  judgment,  and  a  new  trial  was  de- 
nied.    Defendant  brings  error.     Reversed. 

C.  C.  MeNish  and  Allen,  Robinson  &  Reed, 
for  plaintiff  in  error. 

^Y.  W.  Yoimg  and  John  A.  Ehrhardt  for  de- 
f(Midant  in  error,  cite  in  support  of  the  prop- 
osition that,  to  be  available  as  a  defen.se,  the 
statute  of  frauds  must  be  specially  pleaded, 
Ijawrenee  v.  Chase,  Si  Me.  li)G;  Graff  am  v. 
Pierce,  9  N.  E.  819,  143  Ma.ss.  3S();  Brigham 
V.  Carlisle,  78  Ala.  243;  Martin  v.  Blanchett, 
77  Ala.  288;  (iuynn  v.  McCauley,  32  Ark. 
97;  Wynn  v.  Garland,  19  Ark.  38. 

NORVAL,    J.      This    was    an    action    com- 
menced  by  Charles  L.   Lamb  to  recover  of 
plaintiff  in  error  .$1,849.15,  and  interest  there- 
on, as  a  balance  due  for  a  quantity  of  com 
alleged  to  have  been  sold  and  delivered  by 
plaintiff  to  the  defendant.     The  amended  pe- 
tition upon  which  the  case  was  tried  alleges: 
"(1)  That    said    defendant    is    a    coriwration 
duly  organized  and  existing  under  the  gen- 
eral laws  of  the  state  of  Colorado,  and  do- 
ing  business    in    Stanton   county.    Neb.      (2) 
That  some   time  in   the    month   of  October, 
1SS6,  the  precise  date  whereof  the  plaintiff 
is  unable  to  more  specifically  state,  the  plain- 
tiff and  defendant  entered  into  a  verbal  con- 
tract, by  the  terms  of  which  the  plaintiff  sold 
to  said  defendant,  above  named,  all  the  com 
that  he  then  had  on  hand,  including  the  crop 
of  com   then   standing   in   the  fields   of  the 
plaintiff;    and,   in  consideration  of  the  sale 
and  deliveiy  of  said  corn  to  the  defendant, 
the  said  defendant  agretnl  to  pay  the  plaintiff 
the  market  price  per  bushel  paid  for  com  in 
the  said  county  of  Stanton,  in  the  state  of 
Nebraska,  on  any  day,  to  be  selected  by  the 
plaintiff",    between    the    time    of   delivery    of 
.said  com  and  the  month  of  May,  1888,  and 
on  the  day  so  selected   by  the  plaintiff  the 
amount  then  due  the  plaintiff  should  at  once 
become  due  and  payable.     (3)  That  in  pur- 
suance of  said  contract  the  plaintiff  delivered 
to  the  defendant,  in  the  month  of  November, 
1SS(>,  143  bushels  and  3.">  pounds  of  ear  com, 
and  from  the  21st  day  of  December,  188G,  to 
the  oth  day  of  April,  1887,  782  bushels  and 
30  pomids  of  ear  com,  and  on  the  30th  day 
of  December,  1886,   1,2.")9  bushels  of  shelled 
com,    and   in    the   month    of   Januaiy,    1887, 
5,090  bushels  of  shelled  com  and  25  poimds, 
and  that  the  total  number  of  bushels  sold 
and  delivered  amoimted,  in  the  aggregate,  to 
7,275  bushels;    and  the  plaintiff  states  that 
he  is  unable  to  more  fully  state  the  time  and 
the  amount  of  the  delivery  of  said  com  than 
in  this  paragrai)h  stated.     (4)  On  the  1st  day 


of  Febmary,  1888,  the  plaintiff,  in  order  to 
fix  and  establish  the  price  to  be  paid  by  the 
defendant  for  the  com  delivenil  as  afore- 
said, served  notice  on  the  defendant  that  he 
had  selected  the  market  pric(>  per  bushel 
paid  for  corn  in  Stanton  county.  Neb.,  on  that 
date,  to  wit,  the  1st  day  of  February.  1888. 
(5)  That  the  markv^t  price  paid  for  com  on 
the  said  1st  day  of  February,  18S8,  in  Stanton 
county.  Neb.,  was  thirty-five  cents  per  bushel. 
(G)  That  on  the  4tli  day  of  .January,  1887, 
the  defendant  advanced  to  the  i)laintiff  on 
said  corn  the  sum  of  two  himdred  (200)  dol- 
lai-s,  and  on  the  12th  day  of  .Ianuai-\-,  1HS7, 
the  further  sum  of  four  himdred  and  fifty 
(450)  dollars,  for  which  money  so  advanced 
the  plaintiff  afterwards  agreed  to  pay  the 
defendant  interest  thereon  until  the  date  of 
the  selection  of  the  market  price  per  bushel 
to  be  paid  for  said  com.  (7)  That  there  is 
diie  from  the  defendant  to  the  plaintiff  for 
the  said  com  so  delivered  under  the  terms  of 
said  contract  the  sum  of  two  thousand  five 
hundred  and  forty-six  and  twenty-five  one- 
hundredths  (2,540.25)  dollars,  no  part  of 
which  has  been  paid,  except  the  said  sum 
of  $G50,  which,  with  the  interest  thereon,  as 
agreed  between  plaintiff  and  defendant, 
amounts  to  the  sum  of  $G97.10.  (8)  That, 
after  allowing  to  the  defendants  all  just  cred- 
its, there  is  still  due  and  impaid  from  the 
defendant  to  the  plaintiff  the  sum  of  one 
thousand  and  eight  hundred  forty -nine  and 
fifteen  one-hundredths  (1.849.15)  dollars,  to- 
gether with  the  interest  thereon  at  the  rate 
of  seven  per  cent,  from  the  said  1st  day  of 
Februaiy.  1888." 

The  defendant  interposed  a  general  de- 
mm-rer  to  the  amendi'd  petition,  which  was 
overruled  by  the  court,  and  an  exception 
was  taken  to  the  decision.  The  defendant 
then  filed  an  answer  alleging:  "(1)  That  on 
or  about  the  24th  day  of  December,  188(J.  L. 
R.  Crosby,  as  the  general  manager  of  the 
feeding  department  of  said  defendant,  made 
an  oral  agreement  with  said  plaintiff,  where- 
by the  said  plaintiff  was  to  sell  and  deliver 
at  the  ranch  of  def(>ndants  in  Stanton  coun- 
ty, Nebraska,  all  the  corn  and  oats  that  he 
then  owned  near  Pilger,  and  two  car  loads 
of  corn  to  be  shipped  from  Stanton,  and  said 
defendant  agreed  to  pay  said  plaintiff  for 
said  corn  and  oats  the  average  market  price 
between  the  Stanton  and  I'ilger  market  on 
the  day  that  said  plaintiff  selected  and  called 
for  his  money,  between  abcait  the  2-lth  day 
of  December,  188G,  and  the  1st  day  of  May, 
1887,  and  that  said  plaintiff'  was  to  reduce 
said  contract  to  writing,  in  duplicate,  and 
sign  them,  and  forward  them  to  said  L.  R. 
Crosby  for  the  same  to  be  signed  by  said  de- 
fendant, and  one  to  be  returned  to  said  plain- 
tiff. (2)  That  said  plaintiff  failed  and  neg- 
lected to  reduce  said  contract  to  writing  as 
agreed,  and  there  is  no  note  or  memorandum 
of  said  agi-eiMiient  as  required  by  law.  (3) 
That  in  accordance  with  said  oral  agree- 
iiient  made  on  or  about  the  24th  day  of  De- 
cember,  ISSG,   with   said   L.    li.    Crosby,   for 


446 


STATUTE  OF   FRAUDS. 


said  dofcndant,  the  said  plaintiff  dolivcrod 
at  the  ranch  of  said  defendant  in  Stanton 
eoiinfy,  Nebraska,  at  various  dates,  a  total 
of  nine  hundred  and  twi'nly-tive  (iV-J."))  bush- 
els and  sixty-tive  (('>'>}  pounds  of  ear  corn, 
and  six  thousand  three  hundred  and  forty- 
nine  ((j,o4l))  bushels  and  thirty-live  (35) 
pounds  of  shelled  corn;  and  nineteen  hun- 
dred and  ninety-four  (1,!MM)  bushels  and 
twenty-seveu  (27)  pounds  of  oats.  (4)  That 
on  the  2r>th  day  of  April,  1887,  in  accord- 
ance with  the  contract  made  on  or  about  the 
24tli  day  of  Decend»er,  188(5,  the  said  plain- 
tiff had  a  settlement  with  said  defendant  as 
to  the  oats,  and  on  said  date  defendant  paid 
said  plaintiff  for  said  oats  the  sum  of  ij^^r/J.lO. 
(."))  That  on  the  4th  day  of  .January,  1887, 
the  said  defendant  loaned  to  said  plaintiff 
the  sum  of  $200,  and  on  the  12th  day  of 
January,  1887,  said  defendant  loaned  said 
plaintiff  the  further  sum  of  !);4;j0;  and  said 
plaintiff  ajn'eed  to  pay  said  defendant  inter- 
est on  said  money,  and  that  the  same  was  to 
be  settled  and  adjusted,  and  deducted  from 
amount  that  defendant  might  owe  the  plain- 
tiff. (G)  The  defendant,  in  further  answer 
to  the  petition  of  the  plaintiff,  admits  the  al- 
legation contained  in  paragi'aph  one  of  said 
petition;  but,  as  to  all  other  paragi-aphs  in 
said  petition,  it  denies  each  and  every  alle- 
gation therein  contained." 

For  reply,  the  plaintiff  admits  that  he  de- 
livered the  quantity  of  oats  and  corn  stated 
in  the  answer;  denies  that  the  same  were 
delivered  under  the  contract  set  up  by  the 
defendant  in  its  answer;  alleges  that  the 
oats  and  corn  were  sold  and  delivered  under 
separate  and  distinct  contracts;  denies  each 
and  every  other  allegation  set  forth  in  the 
answer. 

The  action  was  tried  in  the  court  below  to 
a  jury,  who  returned  a  verdict  in  favor  of 
the  plaintiff  for  $2,142.38.  The  plaintiff  filed 
a  remittitur  of  $1.25.  and  the  court  overruled 
the  defendant's  motion  for  a  new  trial,  and 
entered  judgment  in  favor  of  the  plaintiff 
upon  the  verdict  of  the  jury.  The  defend- 
ant brought  the  case  to  this  court  for  re- 
view by  proceedings  in  error. 

The  defendant  objected  in  the  district 
court  to  the  introduction  of  any  evidence  in 
the  case,  for  the  reason  that  the  contract 
stated  in  the  petition  is  within  the  statute 
of  frauds,  and  is  therefore  void,  which  ob- 
jection was  overruled  by  the  court.  The 
plaintiff  thereupon  introduced  evidence  tend- 
ing to  pn  e  every  allegation  of  the  petition, 
and  rested.  The  testimony  on  behalf  of  the 
defendant  tended  to  establish  that  the  con- 
tract entered  into  between  the  parties,  re- 
lating to  the  sale  and  purchase  of  the  corn, 
is  the  one  pleaded  in  the  answer;  that  the 
corn  was  delivered  by  the  plaintiff  to  the 
defendant  under  said  agi-eement;  and  that 
corn,  at  the  time  the  same  was  delivered,  as 
well  as  in  May,  1887.  was  worth,  on  the  mar- 
ket in  Stanton  county,  20  cents  per  bushel. 
The  coui-t,  at  the  request  of  the  defendant, 


submitted  to  the  jury  special  findings,  which 
were  answered  by  them,  and  retiu-ned  with 
their  general  verdict.  By  the  third  finding, 
they  found  that  the  contract  between  the 
parti(>s  was  as  claimed  by  the  plaintiff,  and 
that  the  corn  was  delivered  thereunder. 

The  most  important  question  presented  for 
our  consideration  is  whether  or  not  the  con- 
ti'act  set  out  in  the  petition  is  within  the 
statute  of  frauds.  Section  8  of  chapter  32 
of  the  Compiled  Statutes  declares  that  "in 
the  following  cases  every  agreement  shall  be 
void  unless  such  agreement,  or  some  note  or 
memorandum  thereof,  be  in  writing,  and  sub- 
scribed by  the  party  to  be  charged  therewith. 
First.  Every  agi'eement  that  by  its  terms  is 
not  to  be  performed  within  one  year  from 
the  making  thereof.  Second.  Every  special 
promise  to  answer  for  the  debt,  default,  or 
misdoings  of  another  person.  Third.  Every 
agreement,  promise  or  undertaking  made  up- 
on consideration  of  marriage,  except  mutual 
promises  to  marry.  Fourth.  Every  special 
promise  by  an  executor  or  administrator  to 
answer  damages  out  of  his  own  estate." 
The  contention  of  the  plaintiff  in  error  is 
that  the  contract  declared  on  is  void  under 
the  fli'st  subdivision  of  the  section  above 
quoted,  and  that  the  same  is  not  actionable 
or  enforceable  in  the  courts  for  the  reason 
the  agreement  rested  solely  in  parol,  and 
was  not  to  be  performed  by  either  party 
within  the  period  of  one  year  from  the  date 
of  the  making  of  the  same.  The  defendant 
in  error,  in  his  argument,  insists  that  the 
agreement  in  question  does  not  fall  within 
the  clause  of  the  section  already  mentioned; 
that  the  statute  only  applies  to  executory 
contracts,  and  not  one  which  has  been  fully 
performed  on  one  side.  The  authorities  up- 
on the  question  are  divided.  Some  of  the 
courts  of  the  country  hold  that  an  action 
cannot  be  maintiiined  upon  a  parol  agree- 
ment, wiiich,  by  its  terms,  is  not  to  be  per- 
formed within  a  year,  even  though  made  up- 
on a  valuable  consideration,  fully  executed, 
while  other  courts  of  equal  standing  and 
ability  lay  down  the  doctrine  that  full  per- 
formance on  one  side  takes  the  contract  out 
of  the  statute,  and  that  it  is  enforceable. 
We  are  not  now  called  upon  to  examine  the 
conflicting  decisions,  or  to  determine  which 
is  the  true  doctrine,  as  the  question  does  not 
necessarily  arise  in  this  case.  If  we  are 
able  to  comprehend  the  force  and  effect  of 
the  agi'eement  in  question,  it  is  not  within 
the  scope  of  the  statutory  provision  set  out 
above.  A  contract,  in  order  to  be  within 
the  purview  of  said  section,  must  be  such 
that,  by  its  terms,  it  cannot  be  performed 
within  one  year  from  the  making  thereof. 
The  stiitute  does  not  include  a  verbal  agi-ee- 
ment which  may  possibly  or  probably  not  be 
performed  within  a  year,  nor  does  it  ap'ply 
to  a  parol  contract,  in  the  terms  of  which 
there  is  nothing  inconsistent  with  a  full  and 
complete  performance  within  such  period. 
When    a    contract,    not    in    writing,    by    its 


STATUTE  OF  FRAUDS. 


44; 


terms,  or  by  any  fair  and  reasonable  con- 
si  ruction  of  its  provisions,  is  capable  of  be- 
inj;  performed  within  a  year,  it  is  not  within 
tlie  statute.  This  was  settled  by  the  adjudi- 
cations in  tliis  court  in  McCormick  v.  Drum- 
met  t,  9  Neb.  388,  2  N.  W.  72'J;  Connoily  v. 
biddings,  24  Neb.  131,  37  N.  W.  93!);  and 
Kieue  v.  Shaeffinj,',  33  Neb.  21,  49  N.  W.  773; 
and  it  is  \innecessary  to  refer  to  the  de- 
cisions of  other  courts  sustaining  tlie  doc- 
trine of  our  own  cases. 

Let  us  examine  and  see  whether  the  agree- 
ment alleged  .and  proved  was  capable  of  per- 
formance within  a  year  from  tlie  time  the 
same  was  entered  into.     Tlie  plaintiff  below 
sold  to  the  defendant  all  of  his  corn,  includ- 
ing the  crop  ther^^  in  the  field.     The  contract 
contained  no  stipulation  as  to  the  time  when 
tlie  corn  should  bo  delivered  to  the  defend- 
ant.    Truo,  by  the  terms  of  the  agreement, 
plaintiff  was  to  receive  for  the  com  the  mar- 
ket price  paid  for  such  grain  in  Stanton  coun- 
ty on  any  day  that  should  be  thereafter  des- 
ignated i)y  him,  bet^'een  the  time  of  deliv- 
ery and  May,  1888,  but  this  provision  did  not 
bring   the  contract   within   the  statute.     Al- 
though   the    agreement    was    not    performed 
within  a  year  from  its  making,  as  I'egards 
the  selection  of  the  date  upon  which  to  fix 
the   price   the  seller  should   I'eceive  for  the 
corn,    yet   there   was   nothing    in   the   terms 
thereof  which  preventeti  it  from  being  per- 
formed within  the  j'ear.     Under  the  terms 
of    the    agreement,    plaintiff    had    a    perfect 
right,   had   he  so   desired,    to  have   selected 
such  date  at  once,  and  without  delay,— even 
on  the  next  day  after  the  corn  was  delivered. 
It  was  entirely  optional  with  him  to  do  so 
or  not.     The  agi-eement  was  therefore  capa- 
ble of  performance  within  a  year  from  its 
making,   and   is  not   void  by   reason   of  the 
statute  under  consideration.     No  case  c^an  be 
found  reported  in  the  books,  in  the  opinion  of 
the    writer,    of   similar    facts,    where   it   has 
been  held  that  such  a  conti-act  was  within 
the  purview  of  the  statute.     On  the  contraiy, 
the  doctrine  established  by  the  adjudiciitious 
of  this  country  is  that,  in  order  to  bring  a 
case  within  the  operation  of  the  statute  of 
frauds,  there  must  be  an  expre.ss  and  specific 
stipidation  in  the  contract  that  it  is  not  to 
be  performed  within  the  year,  or  it  must  ap- 
pear therefrom  that  it  was  not  the  intention 
of  the  parties  that  the  agreement  should  bo 
performed  within  that  period.    Supra;    Treat 
V.  Hiles,  (Wis.)  32  N.  W.  517;    Baker  v.  L:iu- 
terback,  (INId.)  11  Atl.  703;    Aiken  v.  Nogle, 
47  Kan.  9t),  27  Pac.  825;    Durham  v.  Hiatt, 
127  Ind.   514,  2G  N.   E.   401;    Kent  v.   Kent, 
(52  N.  Y.  500;    Barton  v.  Gray,  57  Mich.  ()22, 
24   N.   W.   G3S;    Horner  v.    Frazier,   (Md.)   4 
Atl.    133;    Smalley   v.    Greene,    (Iowa,)    3    N. 
W.  78. 

The  next  contention  of  plaintiff  in  eiTor  is 
that  the  contract  is  void  under  section  9  of 
said  chapter  32,  which  is  in  the  following 
language:  "Sec.  9.  Every  contract  for  the 
sale  of  any  goods,  chattels,  or  things  in  ac- 


tion,  for  the  price  of  fifty  dollars  or   more 
shall  be  void  unless:— First— a  note  or  mem- 
orandum of  such  contract  be  made  in  writ- 
ing,  and  be  subscrilted   by  the  party  to   be 
cliarged  thereby;  or  second— unless  the  buyer 
sl'.all  accept  and  rev-eive  part  of  such  goods, 
or  the  evidences,  or  some  of  them,  of  sudi 
things  in  aciion,  or,  third— uidess  the  buyer 
.sliall,  at  the  time,  pay  some  part  of  the  pur- 
chase mon(>y."     Tlie  contract  declare«l  upon 
in  the  amended  petition  is  a  verbal  one,  for 
the  sale  of  a  quantity  of  corn  exceeding  in 
value  the  sum  of  .$50.     No  part  of  the  ))ur- 
chase  money  was  paid  at  the  time  the  con- 
tract  was    entered    into.     This    is    coui-e/lod. 
But  the  plaintiff  b'low  insists  that  the  stiiru- 
lations  in  the  contract  have  b"en  fully  per- 
formed  on   his   part;    hence,    tlie   statute   of 
frauds  does  not  .attach.     The  delivery  of  the 
corn    by    the    plaintiff    to   the    defendant    i.s 
averred  in  the  petition,  but  it  is  nowheix*  al- 
leged in  the  phwding  that  the  defendant  ac- 
cepted or  receive<l  any  part  thereof.     A  de- 
livery alone  by  the  vi'udor  of  the  thing  sold 
is  insufficient  to  take  a  parol  contract  for  the- 
sale  of  goods,  of  tlie  price  of  ^.50  or  more, 
out  of  the  statute,  but  there  must  also  be  a 
receipt  and  acceptance   by  the  buyer  of  at 
least  a  part  of  such  goods  under  and  in  pur- 
suance of  the  terms  of  the  contract.    In  Ueed 
on  the  Sfcitute  of  Frauds,  (volume  1.  §  202,) 
the  author  says:    "There  must  be  both  deliv- 
ery and  acceptance;    and  both  parties  must 
partalie  in  the  same  act    *    ♦    ♦    And  it  has 
been    said     tliat,    certainly,    unless    'accept' 
means    more    than    'received,'    as    surely    it 
must,— for     otherwise     the     word     'deliver' 
would,    of  itself,    have   sutficed,— acceptance 
must  mean  .some  act  or  conduct  on  tlie  part 
of  the  buyer  indicating  an  intention  to  retain 
the  goods,  or  such  as  reasonably  to  lead  the 
seller  to  suppose  so.     To  constitute  accept- 
ance   tfvo    acts    are    necessaiy:    The    goods 
must  be  accepted,  and  actually  received.    No 
act  of  the  seller  will  amount  to  acceptance.*' 
The  doctrine  of  the  text  is  amply  sustaJne<l 
by  numerous  judicial  decisions.     See  the  fol- 
lowing   authorities:     Ex    parte    Parker,    11 
Neb.  309.  9  N.  W.  33;    Caulkins  v.  Hellman, 
47   N.   Y.  449;    Smith  v.  Brennan,  02   Mich. 
349,  28  N.  W.  802;    Hansen  v.  Roter,  (A^'is.) 
25   N.   W.   530;    Jamison   v.    Simon.    (Cal.)   8 
Pac.   502;    Fcmtaine  v.   Bush,  40  Minn.   141, 
41  N.  W.  405;    Hardware  Co.  v.  Mullen.  33 
Minn.  195,  22  N.  W.  294;    Taylor  v.  Mueller, 
(Minn.)  15  N.  W.  413.     In  Ex  parte  Parker, 
supra,   this  court  quoted   with  approval   the 
following  language  used  by   the   New   York 
court  in  the  opinion  in  Caulkins  v.  Hellman, 
47  N.  Y.  449:    "No  act  of  the  vendor  alone, 
in    pi>rformance   of  a  contract  void    by   the 
statute  of  frauds,  can  give  validity  to  such 
contract.    *    *    *    Where  a  valid  contract  of 
sale  is  made  in  writing,  a  delivery  pursuimt 
to  such  contract  will   pass  tlie  title  at  the 
place  agreed   upon   for   delivery,  or  a  ship- 
ment of  the  gtxids   in   confonnity   with    the 
terms  of  the  contract  will  pass  the  title  to 


418 


STATUTE  OF  FRAUDS. 


the  vendee  witbont  any  :RH-("iil:inro  of  Ihe 
jjoods  by  him.  But  if  tlie  eoutract  is  oral, 
and  no  part  of  the  price  is  paid  by  the  ven- 
dee, there  must  be,  not  only  a  delivery  of  the 
goods  by  the  vendor,  but  a  receipt  and  ac- 
ceptance of  them  by  the  vendee,  to  pass  the 
title,  or  make  the  vendee  liable  for  the 
price."  Acceptance  is  the  receipt  of  a  thin,:^: 
with  the  intention  to  retain  it.  In  order  to 
constitute  a  binding  acceptance  under  a  con- 
tract for  the  sale  of  personal  property,  in- 
valid by  the  statute  of  frauds,  there  must  be 
some  equivocal  act  on  the  part  of  the  pur- 
chaser showinj;  an  intention  to  accept  and 
appropriate  the  property  as  owner.  Stone  v. 
Browning,  GS  N.  Y.  601;  Simpson  v.  Kinim- 
dick,  28  Minn.  355,  10  N.  W.  18;  Taylor  v. 
Mueller,, (Minn.)  15  N.  W.  41-3.  In  a  suit  up- 
on a  contract  within  the  statute  of  fi-auds, 
the  petition  must  state  facts  taking  the  con- 
ti'act  out  of  the  statute,  or  the  pleading  will 
be  demurrable.  Babcock  v.  Meek,  45  Iowa, 
137:  Burden  v.  Knight,  82  Iowa,  584,  48  N. 
W.  985.  The  conclusion  is  irresistible  that  the 
allegation  of  the  d<4iveiy  of  the  corn  is  not 
sufiicient  to  take  the  contract  out  of  the  op- 
eration of  the  statute,  and  therefore  the  de- 
murrer to  the  amended  petition  should  have 
been  sustained. 

It  is  ui'ged  that  the  defendant  waived  its 
exception  to  the  ruling  on  the  demiiri'er  by 
answering  to  the  merits.  Conceding  this 
point  to  be  well  taken,  still  the  question  of 
the  statute  of  frauds  was  repeatedly  i-aised 
dui'ing  the  trial  on  the  introduction  of  testi- 
mony to  establish  the  contract,  and  to  show 
the  defendant  accepted  the  eoni  under  the 
terms  of  the  parol  agreement.  This  evi- 
dence was  admitted  over  the  objection  of  the 
defendant  that  it  Is  not  alleged  in  the  peti- 
tion that  it  accepted  or  received  any  part 
of  the  corn  sued  for,  and  that  the  contract 
was  void  under  the  statute.  This  evidence 
was  clearly  inadmissible,  without  the  plead- 
ing was  amended.  It  is  a  fundamental  nile 
that  the  allegata  et  probata  must  agree. 

It  is  claimed  that  the  statue  of  frauds  is 
not  available  as  a  defense  in  this  cusc-  for  the 
rea.son  that  it  is  not  set  up  in  the  answer. 
The  defendant,  in  its  pleading,  denies  the 
making  of  the  contract  upon  which  the  ac- 
tion was  brought;  sets  up  an  entirely  differ- 
ent agreement  for  the  purchase  and  sale  of 
the  corn.  There  was  no  waiver  of  the  stat- 
ute by  the  failure  to  plead  it  as  a  special  de- 
fense. Under  the  general  denial,  the  defend- 
ant had  the  right  to  avail  itself  of  the  in- 
validity of  the  agreement  under  the  statiite 
of  frauds.  The  plaintiff,  in  order  to  i-eeover, 
was  obliged  to  prove  hLs  contract  substan- 
tially as  alleged,  and  a  receipt  and  accept- 
ance of  the  com  mider  it.  Browne,  St. 
Frauds,  §  511;  Ilussell  v.  Railway  Co., 
(Minn.)  39  N.  W.  302;  Cosand  v.  Bunker, 
(S.  D.)  50  N.  W.  84;  Tatge  v.  Tatge.  34  Minn. 
272,  25  N.  W.  596  and  2tJ  N.  W.  121;  Taylor 
V.  Allen,  40  Minn.  4.3.3.  42  N.  W.  292;  Fon- 
taine V.  Bush,  40  Minn.   141,  41  N.  W.  465; 


Berrien  v.  Southack,  (City  Ct.  N.  Y.)  7  N.  Y. 
Supp.  324:  Smith  v.  Theobald,  (Ky.)  5  S.  \V. 
394;  Wiswell  v.  Tefft,  5  Kan.  263;  Bonham 
v.  Craig,  80  N.  C.  224;  Popp.  v.  Swanke,  68 
Wis.  364,  31  N.  W.  916.  The  last  was  an 
action  to  enforce  specitically  the  perfonnance 
of  an  oral  agrix^ment  for  the  sale  of  land. 
The  defendant  neither  pleaded  the  statute 
of  frauds,  nor  objected  to  the  admission  of 
evidence  on  the  trial  because  the  contract 
was  within  the  statute,  but  at  the  close  of 
the  trial  requested  the  court  to  tind  as  a  fact 
that  the  contract  rested  in  pai'ol,  and,  as  a 
conclusion  of  law,  that  it  was  void.  It  was 
held  that  the  (piestlon  of  the  validity  of  the 
agreement  was  sutRciently  raised.  There 
are  a  few  cases  which  hold  tliat  the  statute 
of  frauds  must  be  specially  pleaded,  to  be 
available,  some  of  which  are  cited  in  the 
brief  of  defendant  in  error,  but  the  decided 
weight  of  the  decisions,  as  well  as  the  bet- 
ter reason,  is  the  other  way. 

We  will  next  notice  one  assignment  of  er- 
ror based  upon  a  ruling  of  the  court  on  the 
introduction  of  the  testimony.  The  plaintiff 
below  was  permitted  to  prove,  over  objec- 
tions of  the  defendant,  that  the  contract  up- 
on which  the  action  was  brought  was  made 
with  the  defendant  through  its  general  man- 
ager, J.  A.  Brome.  It  is  insisted  that  this 
testimony  was  inadmissible  until  it  had  first 
been  shown  that  Brome  had  authority  to 
make  such  a  contract.  We  do  not  agree 
with  counsel  in  this  proposition.  It  had  been 
shown  by  competent  evidence  that  Mr. 
Brome  was  the  general  manager  of  the  de- 
fendant corporation,  l>efore  any  attempt  was 
made  to  prove  the  contract  entered  into  by 
him  for  his  company  for  the  purchase  of  the 
com.  Therefore,  it  was  ininecessary  to  show 
that  he  had  authority  to  make  the  contract, 
the  presumption  being  that  he  was  invested 
with   such  power. 

Cr)nii)laint  is  made  of  the  giving  of  the 
fourth  paragraph  of  the  court's  charge  to 
the  juiy,  which  is  as  follows:  "(4)  The  de- 
fendant, in  his  [its]  answer,  denies  the  mak- 
ing of  the  contract  sued  on,  and  alleges  that 
the  price  agreed  to  l>e  paid  for  the  com  pur- 
chased of  the  plaintiff  was  the  average  mai'- 
ket  price  between  Stanton  and  Pilger  mar- 
kets, in  said  county,  on  a  day  to  be  selected 
by  the  plaintiff,  between  December  24,  1886, 
and  May  1,  1887."  The  above  was  one  of 
several  instructions  given,  stating  the  issues 
in  the  ca.se,  and,  when  taken  in  connection 
witli  the  other  instiiictions,  was  not  mislead- 
ing. It  cleai'ly,  and  in  concise  language, 
stated  to  the  jury  one  of  the  issues  present- 
ed by  the  pleading  and  the  evi<lence. 

Exception  was  taken  to  the  giving  of  the 
following  instruction:  '•(8)  But,  if  you  find 
that  there  was  no  agreement  made  as  to  the 
price  the  plaintiff  was  to  receive  for  said 
com,  then  you  should  award  him  for  tlie 
corn  received  by  the  defendant,  and  unpaid 
for,  the  fair  market  value  of  the  same  at  the 
time  of  its  deliveiy  as  shown  by  the  evidence, 


STATUTE  OF  FRAUDS. 


449 


If  any  siieh  evidence  is  before  yon,  witli  in- 
terest thereon  fix>m  the  time  of  its  delivei-y 
at  the  rate  of  seven  per  cent,  per  annum." 
This  instniction  should  not  have  b<'en  given. 
Tlie  action  is  grounded  upon  an  express  con- 
tract. The  petition  contains  no  allegation  of 
a  quantum  meruit.  Wliere  a  contract  for 
the  saJe  of  personal  property  is  void  under 
the  statute  of  frauds,  and  tliei-«  has  been 
a  deliveiy  of  the  tiling  sold  to  the  purchaser, 
and  an  acceptance  thereof  by  him,  the  plain- 
tiff may  recover  the  reasomible  value  of  the 
property,  if  his  petition  is  so  framed;  but 
a  party  cannot  recover  on  a  qiKuitum  meruit, 
where  he  pleads  and  relies  solely  upon  a  spe- 
cial contract  Eyser  v.  Weissgerber,  2  Iowa, 
468;  Freher  v.  Geeseka,  5  Iowa,  472;  Form- 
holz  v.  Taylor,  13  Iowa,  500;  Imhoff  v. 
House,  36  Neb.  28,  53  N.  W.  1032.  The  in- 
struction under  coiLsideration  was  in  direct 
conflict  \Aith  instruction  No.  5,  given  by  tlie 
court,  which  told  the  juiy  that,  "before  the 
plaintiff  is  entitled  to  a  verdict  for  tht 
amount  sued  for.  it  is  incimibent  upon  him 
1o  prove  by  a  preponderance  of  the  evidence 
th:U  he  made  the  contract  with  the  defend- 
ant as  alleged,  whereby  the  defendant  agreed 
to  pay  the  plaintiff  the  market  price  of  the 
corn  in  Stanton  cotmty  on  a  day  selected  by 
him,  between  the  time  of  delivering  the  same 
and  the  1st  of  May,  1888."  By  the  one  in- 
struction the  jiuy  were  informed  that  the 
plaintiff  could  only  recover  in  case  the  evi- 
dence established  a  special  contract,  while 
by  the  other  they  were  told  he  was  entitled 
to  the  market  value  of  the  com,  even  though 
there  was  no  stipulation  as  to  the  price  he 
M^as  to  receive  therefor.  These  conflicting 
statements  of  the  law  before  the  jury  left 
them  in  doubt  as  to  the  paragraph  upon 
which  they  should  rely.  It  should  be  stat- 
ed that  instruction  No.  8  was  predicated  up- 

VAN  ZILE  SEL.  CAS.  SALES— 29 


on  evidence  intr(>duce<l  by  the  defendant,  and 
against  the  f>bj«H,'tion  of  the  plaintiff  below, 
showing  the  market  value  <tf  the  corn  at  the 
time  of  its  allege<l  deliv«'ry.  We  are  per- 
suaded, however,  fliat  the  defendant  was  not 
in  the  least  prejudiced  l>y  the  giving  of  this 
instruction,  since,  had  tlie  jury,  in  arriving 
at  their  verdict,  allowed  the  plaintiff  the 
market  value  of  the  com.  tlie  recoveiy  would 
have  been  scarcely  one-half  the  sum  stated 
in  the  verdict.  It  is  obvious  that  the  recov- 
eiy  was  upon  the  basis  of  the  special  con- 
tract alleged   by   the  plaintiff. 

The  defendant  asked,  and  the  court  re- 
fused to  give,  the  following  instniction:  "(12) 
If  the  contract  claimed  liy  the  plaintiff  in  his 
petition  was  wholly  oral,— that  is,  by  word 
of  mouth,— and  no  part  of  the  purchase 
money  was  paid,  or  no  pail  of  the  corn  was 
delivered  thereunder,  then  the  plaintiff  has 
failed  to  make  out  his  case,  and  your  ver- 
dict must  be  for  the  defendant.  And  there 
would  be  no  such  deliverj-  of  the  com  to 
the  defendant,  if  the  plaintiff  simply  ^tonxl 
his  com,  or  a  part  of  it,  in  the  defendant's 
crib,  under  an  arrangement  whereby  it  was 
to  remain  his  pinpcrty  until  such  time  as 
he  saw  fit  to  sell  it  to  the  defendant."  This 
request  to  charge  correctly  states  the  law 
relating  to  the  statute  of  frauds,  which  was 
one  of  the  questions  in  the  casis  and  should 
have  been  submitted  to  the  jury.  It  wa^ 
not  covered  by  any  instruction  given,  and 
it  was  error  to  refuse  it.  Bank  v.  Careon, 
30  Neb.  104.  46  N.  W.  276. 

There  are  other  errors  assigned  upon  the 
giving  and  refusing  of  instnutious,  which 
need  not  be  noticed.  Tlu>  judgment  of  the 
district  court  is  revei-sed.  and  the  cause  re- 
manded for  further  proceedings,  with  leave 
to  the  plaintiff"  to  amend  his  petition,  if  he 
so  desires.     The  other  judges  concur. 


450 


STATUTE  OF  FKATDS. 


LEGGETT  &  MEYER  TOBACCO   CO.   v. 
COLLIER  et  al. 

(56  N.  W.  417,  89  Iowa,  144.) 

Supreme  Court  of  Iowa.      Oct.  9,  1893. 

Appeal  from  district  court,  Lee  county; 
J.  M.  Casey,  Judj,'.". 

Action  of  replevin.  Verdict  and  judgment 
for  defendants.     PlaintiCf  appeals. 

Craig.  McCrary  &  Craig,  for  appellant.  F. 
T.  Hughes  and  James  C.  Davis,  for  appel- 
lees. 

KINNE,  J.  1.  Plaintiff,  a  corporation, 
was  a  manufacturer  of  tobacco  in  St.  Louis, 
Mo.  Defendants  Collier,  Robertson  &  Ham- 
bleton  were  a  tirm  of  wholesale  gi'ocers, 
ri'siding  and  doing  busine.ss  in  the  city  of 
Keokuk,  Iowa.  At  and  prior  to  December, 
1890,  said  tirm  had  placed  a  standing  order 
with  plaintiff  for  shipment  of  3.5  boxes  of 
'"Star"  tobacco  on  every  Monday  morning. 
A  shipment  was  made  to  said  firm  in  ac- 
cordance with  said  order  on  Monday,  Decem- 
ber 8,  1890.  On  said  day.  and  after  the 
shipment  had  been  made,  plaintiff  received 
the  following  letter  from  said  firm,  dated 
the  Gth  of  December,  1890:  "Gents:  Please 
omit  our  shipment  of  this  week  on  Star  to- 
bacco, and  follow  next  week  as  usual,  and 
oblige,  yours,  etc..  Collier,  Robertson  &  Ham- 
bleton.''  Plaiutilf  at  <mce  wrote  to  said  firm 
that  the  tobacco  had  been  shipped  before 
the  receipt  of  their  letter,  and  said  they 
would  omit  the  next  week's  shipment.  No 
reply  was  rec-eived  to  this  letter.  The  to- 
l)acco  arrived  in  Keokuk  on  December  9, 
1890,  and  was  delivered  to  said  firm  at  their 
store.  On  December  10,  1890,  defendant 
firm  executed  to  the  defendant  Smith,  trus- 
tee, two  chattel  mortgages  on  all  property 
of  the  firm,  to  secure  certain  creditors  in  the 
aggregate  sum  of  about  $83,000.  The  trus- 
tee on  the  same  day  took  possession  of  all 
the  property  covered  by  the  mortgages,  in- 
cluding the  tobacco  in  controversy.  There- 
after plaintiff  began  this  action,  and  re- 
plevined  said  tobacco.  Under  the  direction 
of  the  court,  the  jxu-y  returned  a  verdict  for 
the  defendant  Smith,  trustee. 

2.  It  is  insisted  that  the  mortgages  under 
which  the  defendant  trustee  holds  the  goods 
are  void,  because  the  acknowledgments 
thereto  are  defective.  The  acknowledgment 
to  the  first  mortgage  recites  that  on  Decem- 
ber 10,  1890,  before  the  notary,  "personally 
appeared  Collier,  Robinson  &  Hambletoii, 
by  Hugh  Robertson,  of  said  firm,  personally 
known  to  me  to  be  the  identical  person  who 
signed  the  name  of  the  said  firm  to  the 
above  mortgage  as  mortgagors,  and  to  be  a 
member  of  said  firm,  and  acknowledged  the 
execution  thereof  to  be  the  voluntary  act  and 
deed  of  said  firm,  for  the  uses  and  purposes 
therein  expressed;  and  also  on  the  same  day 
the  other  members  of  said  firm  acknowl- 
edged the  execution  of  said  instrument  to  be 


the  voluntary  act  and  deed  of  said  firm." 
The  acknowledgment  of  the  second  mortgage 
recites  that  before  the  notary  "personally 
appeared  Collier,  Robinson  &  Hambleton, 
by  each  one  of  said  firm,  and  who  are  per- 
sonally known  to  me  to  be  the  identical  per- 
sons who  signed  the  mortgage,  and  to  be 
a  member  of  said  firm,  and  one  of  whom 
signed  the  name  of  said  firm  to  the  above 
mortgage  as  mortgagors,  and  acknowledged 
the  execution  tliereof  to  be  the  voluntary  act 
and  deed  of  said  firm,  for  the  uses  and  pur- 
poses therein  expressed."  For  the  purposes 
of  this  action  it  is  not  material  whether  the 
acknow'ledgments  were  defective  or  not, 
since  the  instruments  were  the  act  of  the 
partnership,  and,  as  between  the  parties 
thereto,  were  valid  without  any  acknowl- 
edgment, and  inasmuch  as  it  appears  with- 
out dispute  that  the  mortgagee  trustee  took 
actual  possession  of  all  the  property  cov- 
ered by  said  Instruments  several  daj-s  prior 
to  the  commencement  of  plaintiff's  action. 
The  effect  of  an  acknowledgment  would  be 
to  entitle  the  mortgages  to  be  filed  for  rec- 
ord and  recorded,  when  they  would  be  notice 
to  the  world.  The  same  piu'pose  is  accom- 
plished if  the  mortgagee  actually  takes  pos- 
session of  the  property.  There  can  be  no 
better  notice  to  a  claimant  of  property  which 
is  chattel  mortgaged  than  the  fact  that  the 
mortgagee  is  in  possession  of  it.  "If  a  mort- 
gagee takes  possession  of  the  mortgaged 
chattels  before  any  other  right  or  lien  at- 
taches, his  title  under  the  mortgage  is  good 
against  everybody  if  it  was  previously  valid 
between  the  parties,  although  it  be  not  ac- 
knowledged or  recorded,  or  the  record  be 
ineffectual  by  reason  of  any  irregularity. 
The  subsequent  delivery  cures  all  such  de- 
fects, and  it  also  cures  any  defect  there 
may  be  through  an  insutficient  description 
of  the  property.  The  taking  possession  is 
an  identification  and  appropriation  of  the 
specific  prd^ierty  in  the  mortgage."  Jones, 
Chat.  Mortg.  §  178;  Cobbey,  Chat.  Mortg. 
§  626;  Fromme  v.  Jones,  13  Iowa,  474;  Gaar 
V.  Hurd,  92  lU.  326. 

3.  After  the  introduction  of  the  testimony, 
the  court  orally  directed  the  jm-y  to  return 
a  verdict  for  the  defendant.  Exceptions 
were  taken  because  the  direction  was  not 
in  writing.  Such  a  direction  is  in  no  sense 
an  instruction,  such  as  is  contemplated  by 
Code,  §§  2784-2789,  inclusive.  Stone  v.  Rail- 
road Co.,  47  Iowa,  82;  Milne  v.  Walker,  59 
Iowa,  186,  13  N.  W.  Rep.  101;  Young  v. 
Mattress  Co.,  79  Iowa,  419,  44  N.  W.  Rep. 
693. 

4.  The  main  question  involved  in  this  case 
is,  in  whom  was  the  title  or  right  of  posses- 
sion to  the  tobacco  when  the  writ  in  this  ac- 
tion was  served?  If  by  reason  of  the  acts  of 
the  parties  the  title  to  the  tobacco  passed  to 
the  defendant  firm,  then  the  trustee  was  the 
rightful  holder  of  it  when  this  action  com- 
menced, and  the  court  below  properly  direct- 


STATITE  OF   FKAIDS. 


451 


ed  a  verdict  for  him.  The  order  for  the  to- 
bacco having  been  accepted,  and  acted  upon 
by  plaintiff,  by  dehvering  tlie  j^ooils  to  the 
raihvay  company  for  carriaf;(>  to  tlie  defend- 
ant firm,  it  was  not  within  the  power  of 
said  firm  to  successfully  countermand  it  by 
any  notice,  no  matter  when  mailed,  which 
did  not  reach  the  seller  prior  to  the  delivery 
of  the  goods  to  the  carrier.  Such  deliveiy, 
prior  to  the  countermand  of  the  order,  vest- 
ed in  the  defendant  firm  the  title  to  the 
goods,  sid)ject  to  the  exercise  of  the  right  of 
stoppage  in  transit  by  the  seller.  So  long  as 
the  order  had  not  been  accepted  by  a  de- 
livery of  the  goods  to  the  carrier,  it  might  he 
countermandetl;  not  so,  however,  after  the 
act  of  acc(i)tance  Avas  complete.  In  the  case 
at  bar  there  was  no  imdertaking  by  the  ven- 
dor to  deliver  the  goods  at  the  place  of  busi- 
ness of  the  defendant  firm,  nor  did  the  ven- 
dee designate  a  special  carrier  by  whom  the 
delivery  should  be  made.  In  the  absence  of 
such  designation  and  undertaking,  the  iiile 
is  that  a,  delivery  to  the  common  canier,  in 
the  usual  and  ordinary  course  of  business, 
transfers  title  and  possession  of  the  property 
to  the  vendee,  subject,  as  we  have  said,  to 
the  exercise  by  the  vendor  of  the  right  of 
stoppage  in  transit.  Garretson  v.  Selbj',  37 
Iowa,  531;  Alsberg  v.  Latta,  30  Iowa,  445; 
^Vhitlock  V.  AVorkman,  15  Iowa,  354;  Benj. 
Sales.  (Bennett's  Ed.  IS'Ji',)  §  ISl;  21  Amer. 
&  Eng.  Euc.  Law,  pp.  497-499,  529;  Sarbeck- 
er  V.  State,  (Wis.)  26  N.  W.  Rep.  542;  Falvey 
V.  Richmond,  (Ga.)  13  S.  E.  Rep.  2(51;  Mc- 
Laughlin V.  Marston,  (Wis.)  47  N.  W.  Rep. 
1058;  Bacharach  v.  Freight  Line,  (Pa.  Sup.) 
19  Atl.  Rep.  409;  Kessler  v.  State,  (Mimi.)  44 
N.  W.  Rep.  794.  Sullivan  v.  Sullivan,  70 
Mich.  583,  38  N.  W.  Rep.  472,  was  a  case 
where  jilaintiff.  a  manufacturer  of  liquors  at 
Frankfort,  Ky.,  and  having  a  wholesale  hotise 
at  Cincimiati,  Ohio,  took  an  order  orally 
while  in  Michigan  for  two  barrels  of  whisky. 
He  sent  the  order  to  his  distillery  at  Fraidi- 
fort,  and  it  was  shipped  from  there  to  Ryan 
&  :M(?Carney,  .at  Detroit,  Mich.  The  whisky 
was  shipped  February  19,  1887.  February 
26.  1887,  the  firm  telegraphed  plaintiff:  "Can- 
cel order.  Will  explain  by  mail.''  Plaintiff 
responded:  "Goods  were  shipped  the  21st. 
Receive,  and  wait  further  advice."  No  other 
communication  passed  between  the  parties 
till  tlie  goods  were  disposed  of.  The  whisky 
arrived  in  Detroit  in  due  time.  The  con- 
signees paid  the  freight,  and  placed  the  whis- 
ky with  their  stock.  INIarch  9th  defendant, 
who  held  an  account  against  the  consigne.>s 
for  $215,  purchased  the  whisky  for  $220.  re- 
ceipting his  account  and  paying  $5  in  addi- 
tion, and  took  the  whisky.  He  purchased  in 
good  faith,  and  without  notice  that  there  was 
any  claim  against  tlie  propertj'.  After  the 
sale,  one  of  the  consignees  caused  a  telegram 
to  be  sent  the  plaintiff  that  consignees  had 


faileil.  Plaintiff  sued  in  trover  for  the  con- 
version of  the  whisky.  It  was  held  that  the 
sale  was  com])leted;  that  a  "verbal  order, 
followed  by  deliver}-  and  acceptance,  is 
enough,  under  the  statute  of  frauds,  to  com- 
plete the  sale."  In  the  case  at  bar  the  at- 
ti'iiii)ted  countermand  of  the  order  was  a  rec- 
ognition of  tlie  (^\istenc<'  of  the  order  to  shi]). 
The  testimony  shows  that  tlie  goods  were  in 
fact  rec(>iv(«d  at  the  store  of  defendant  firm, 
and  treated  the  same  as  other  goods.  There 
was  no  act  of  the  firm,  after  they  must  have 
known  that  th  •  go'.;  had  in  fact  been  slii])- 
ped  prior  to  the  receipt  of  tl)eir  letters,  which 
tended  to  show  that  they  did  not  consider 
and  treat  the  tobacco  as  their  prop.rty. 
Again,  there  is  nothing  to  show  that  prior  to 
the  time  i)laintiff  became  aware  that  the 
defendant  firm  had  failed  it  made  any  claim 
to  the  goods.  It  did  not  recognize  the  coun- 
termand of  the  order  as  in  any  way  binding. 
It  is  said  that  there  was  no  acceptance  of 
the  goods,  and  hence  the  case  is  within  the 
statute  of  frauds.  I'nder  our  statute,  the  de- 
livery of  goods  under  a  contract  of  sale,  to 
a  common  carrier  in  the  usual  cotirse  of 
transportation,  is  stifRcicnt  to  take  the  case 
out  of  the  statute.  Code,  §§  3663,  3664.  In 
tliis  respect  our  statute  seems  to  be  dilTer- 
eiit  from  that  of  New  York,  where  both  de- 
livery and  acceptance  are  required.  \Ve 
tiiink,  however,  that  the  evidence  shows  an 
acceptance  of  the  tobacco.  When  the  tobac- 
co came  to  the  store,  the  shipping  clerk  of 
the  firm  was  aware  of  the  fact,  and  bjiew 
that  the  order  for  it  had  been  countermand- 
ed. The  firm,  with  knowledge  that  the  to- 
bacco had  been  delivered  to  it,  took  no  steps 
to  return  the  same,  but  the  next  day  exer- 
cised an  unequivocal  act  of  ownersliip  over 
it  by  mortgaging  it  to  the  defendant  trustee. 
If  defendant  firm  did  not  c<msider  it  their 
property  if  they  had  not  accepted  it,  why 
did  they  mortgage  it?  They  thereby  under- 
took to  make  a  disposition  of  it  alisolutely  in- 
consistent with  any  claim  tliat  they  had  not 
accepted  the  propei-fy.  Thus  we  see  that 
both  plaintiff  and  the  defendant  firm  treated 
the  transaction  as  a  sale  and  deliver}-  of  the 
tobacco.  I'nder  our  view,  we  need  not  con- 
sider the  error  based  on  the  refusal  of  the 
lower  court  to  give  instnietions  asked  iiy 
plaintiff.  They  were  properly  refused.  It 
cannot  be  doubted  that,  tlie  tobacco  having 
been  shipped  in  pursuance  of  an  order  before 
that  time  made,  and  having  been  received, 
accepted,  and  retained  liy  the  defendant  firm, 
said  firm  are  liable  to  plaintiffs  for  its  value, 
notwithstanding  the  attempted  countermand 
of  the  order,  wliicli  was  never  recognized  by 
plaintiff.  It  is  apparent,  then,  that  when  the 
writ  was  served  in  this  action  plaintiffs  liad 
no  riglit  or  title  to  or  interest  in  the  tobacco. 
The  court  Ik'Iow  propcn-ly  directed  a  verdict 
for  the  defendant  Smith.    Affirmed. 


462 


STATUTE  OF  FRAUDS. 


HUDSON  FT^RXITURE   CO.  v.  FREED 
FTRNITURE  &  CARl'ET  CO. 

(8(!  Pac.  132,  10  Utah,  31.) 
Supreme  Court  of  Utah.      March  20.  1S9-I. 

Appeal  from  distj'ict  court,  Salt  Lake  coiin- 
ty;    before  Justice  C.  S.  Zune. 

Action  by  the  Hudson  Furniture  Company 
ajrinst  the  Frifd  FurnituL-e  &  Carpet  Compa- 
ny for  the  price  of  floods  sold  and  delivered. 
A'erdict  for  plaintiff  set  aside,  and  a  new 
trial    m-auted.     Plaintiff   appeals.     Affirmed. 

Frank  B.  Stepliens  and  Benner  X.  Smith, 
for  appellant.  Brown  &  Henderson,  for  i"e- 
spoudent. 

BARTCH,  J.  This  is  an  action  brought  to 
recover  the  price  of  goods  sold  under  verbal 
contract.  The  .im-y  rendered  a  verdict  in 
favor  of  the  i)laintiff.  and  thereupon  the  de- 
fendant moved  for  a  new  trial.  On  the  hear- 
iufr  of  this  motion  the  verdict  was  set  aside, 
and  a  new  trial  granted.  From  this  order, 
llie  plaintiff  appealed. 

It  appears  from  the  evidence  that  plaintiffs 
agent  called  upon  the  defendant,  and  re- 
ceived his  verbal  order  for  the  goods  in  ques- 
tion at  the  agreed  price  of  $438.9<;»,  the  goods 
to  be  delivered  free  on  board  of  cars  at  Hud- 
son. Wis.,  consigned  to  the  defendant.  No 
particular  railroad  or  cari'ier  was  designated. 
It  furtlier  appears  that  the  goods  were  de- 
live^rcKl  on  board  of  cars,  and  shipped  to  Salt 
Lake  City,  in  pursuance  of  said  order;  that 
a  bill  was  sent  to  the  defendant;  and  that 
thereupon,  and  before  tlie  goods  arrived  at 
Salt  Lake  City,  the  defendant  telegraphed 
and  wrote  to  the  plaintitf,  refusing  to  re- 
ceive or  accept  the  goods.  The  respondent 
contends  that  this  contract  was  void  under 
the  statute  of  frauds,  and  that  to  entitle  the 
])laiutiff  to  recover  there  must  be  shown  a 
delivery  of  the  goods  by  the  plaintiff,  and 
an  acceptance  by  the  defendant.  The  appel- 
lant insists  that  the  delivery  of  the  goods  to 
the  caiTier  was  a  receiving  of  the  same  by 
the  defendant,  and  thereiore  does  not  fail 
within  the  statutt;  of  frauds,  and  that  this 
case  is  controlled  by  section  2S3;j,  Comp. 
Laws  Utah  1SS8,  which  reads  as  follows: 
"Every  conti-act  for  the  sale  of  any  goods, 
cluittels,  or  things  in  action  for  the  price  of 
three  hundred  dollars,  or  over,  shall  be  void, 
unless:  1.  A  note  or  memorandum  of  such 
contract  be  made  in  writing  and  subscribed 
by  the  parties  to  be  charged  therewith.  2. 
Unless  the  buyer  shall  accept  or  receive  part 
of  such  goods,  or  other  evidences,  or  some 
of  them,  of  such  things  fn  action;  or  3.  Un- 
less the  buyer  shall  at  the  time  pay  some 
part  of  the  purchase  money."  This  law  was 
enacted  in  ISO.j,  and  under  its  provisions,  if 
the  buyer  either  accepted  or  received  the 
goods,  its  terms  would  appear  to  be  satisfied; 
and.  if  this  were  the  only  statute  affecting 
this  class  of  contracts,  then  the  only  ques- 
tion in  this  case  would  be  whether  the  deliv- 
ery by  the  s.-l!«T  to  a  carrier  not  designated 


by  the  buyer  would  be  a  sufficient  receiving 
of  the  goods  on  the  part  of  the  buyea-.  Coun- 
sel for  appellant  has  cited  several  cases 
which  appear  to  hold  the  affirmative  of  this 
proposition  luider  statutes  similar  to  the  one 
under  consideration.  We  do  not  deem  it 
necessary,  however,  to  pass  upon  this  ques- 
tion, in  view  of  a  later  law  found  in  section 
3018,  Comp.  Laws  Utah  1888,  which  provides 
as  follows:  "In  the  following  cases  the 
agreement  is  invalid,  imless  the  same  or  some 
note  or  memorandum  thereof  be  in  writing 
and  subscribed  by  the  party  charged,  or  by 
his  agent.  Evidence,  therefore,  of  the  agi'ee- 
ment  cannot  be  received  without  the  writing 
or  secondary  evidence  of  its  cuitcnls."  Omit- 
ting the  parts  of  this  section  not  matei'ial  in 
this  case,  subdivision  4  reads:  "An  agree- 
ment for  the  sale  of  goods,  chattels,  or  things 
in  action,  at  a  price  not  less  than  two  hun- 
dred dollars,  luiless  the  buyer  accept  and  re- 
ceive a  part  of  the  goods  and  chattels,  or  the 
evidences,  or  some  of  them,  of  such  things  in 
action,  or  pay  at  the  time  some  part  of  the 
purchase  money."  This  law  was  passed  in 
1884,  and  is  the  latest  expression  of  legisla- 
tive will  on  this  subject.  Under  its  terms 
no  evidence  of  an  agreement  for  the  sale  of 
i  goods,  the  price  of  which  is  $200  or  more, 
1  can  be  received,  except  the  writing  or  sec- 
ondary evidence  of  its  contents,  unless  the 
buyer  has  accepted  and  received  a  part  of 
the  goods;  and  such  a  contract  not  in  writ- 
ing is,  in  its  inception,  void,  and  only  be- 
comes operative  when  the  buyer  has  both 
accepted  and  received  a  portion  of  the  goods. 
This  is  so  because,  after  an  appropriation  of 
the  goods  as  his  own,  he  will  not  be  heard 
to  assail  the  validity  of  the  contract  under 
which  they  became  his  property.  Under  sec- 
tion 2831),  supra,  this  result  api)eared  to  rol- 
low  whenever  the  buyer  accepted  or  received 
a  part  of  the  goods.  The  former  statute  uses 
the  phrase  "accept  or  receive,"  the  latter 
"accept  and  receive."  In  the  former,  the 
conjunction  is  a  connective  which  marks  the 
alvernative,  and  it  would  appear  that  either 
an  acceptance  of  a  part  of  the  goods  or  a 
receiving  of  the  same  would  avoid  the  opera- 
tion of  the  statute.  In  tlie  latter,  the  con- 
jiuiction  expresses  the  relation  of  addition 
of;  and  here  to  avoid  the  operation  of  the 
statute  it  must  be  shown,  not  only  that  a 
part  of  the  goods  were  accepted,  but  also 
that  they  were  actually  received.  It  is  clear 
that  the  two  sections  are  repugnant  to  each 
other  in  this  respect,  and,  as  section  3918  is 
the  latest  expression  of  our  legislature,  it 
must  prevail;  and,  in  so  far  as  the  two  stat- 
utes are  repugnant  to  each  other,  the  former 
is  repealed  by  the  latter  by  implication.  The 
fact  that  the  former  is  not  expressly  repealed 
by  the  latter,  and  is  om*  regular  statute  of 
frauds,  as  insisted  by  counsel  for  appellant, 
makes  no  difference.  Nor  does  the  fact  that 
the  latter  is  merely  a  statute  of  evidence, 
adopted  with  the  Civil  Code,  and  forming  a 
part  of  it,   change  the  rule  of  consti'uction 


STATUTE  OF  FRAUDS. 


453 


that,  whore  there  is  a  positive  repugnancy  be- 
tween the  provisions  of  two  statutes,  the 
former  in  point  of  time  is  repealed  by  the 
later  by  implication,  to  the  extent  of  such  re- 
pugnancy. In  so  far  as  the  later  law  is 
meicly  auxiliary  or  aftirmative  or  cumulative, 
it  does  not  repeal  the  former.  Both  statutes 
must  be  construed  togetlier.  and  given  effect 
as  far  as  possible,  for  botli  are  presumed  to 
have  boon  enacted  with  deliberation,  and 
with  a  knowledge  of  all  existing  laws  on  that 
subject.  Suth.  St.  Const.  §§  ir)2,  1C<);  Wood 
V.  U.  S.,  16  Pet.  342;  People  v.  Board  of 
Sup'rs,  67  N.  Y.  109. 

We  are  of  the  opinion  that,  to  entitle  a  per- 
son to  recover  under  a  contract  such  as  the 
-one  under  consideration,  both  an  acceptance 
and  a  delivery  must  be  shown.    Was,  then, 
the  delivery  to  the  carrier  in  this  case  such 
a  delivery   as  will   satisfy   the  provision   of 
law  expressed  in  the  phrase  "accept  and  re- 
ceive," or  as  will  avoid  the  operation  of  the 
statute?    No  part  of  the  purchase  money  was 
paid  by  the  buyer,  and  no  note  or  memoran- 
dum of  the  contract  was  signed  by  him.    The 
transaction    was    made   in   pursuance  of   an 
oral   agreement,   which   was  void   luider  the 
statute,   unless    the   buyer   accepted   and   re 
<!eived  a  part  of  the  goods.    A  buyer  may  re- 
ceive the   goods   for  the  express   purpose  of 
ascertaining  their  quality  or  fitness  for  the 
use  intended,  and  may  tlien  refuse  to  accept 
them,  or  he  may  accept  them  and  yet  never  re- 
ceive them.    In  neither  case  dot  s  ho  appropri- 
ate them  to  himself  and  oust  the  seller  of  his 
property   in    them.    Nor  does  he   divest   the 
owner  of  his  lien  or  of  his  right  of  stoppage 
in  transitu.    To  satisfy  the  statute  there  must 
be  such  an  act,  or  such  conduct,  on  the  part 
■of  the  buyer,  as  will  manifest  an  intention  to 
accept  and  receive  the  gomls  as  his  own,— 
such  an  act  or  such  conduct  as  will  supply 
the  place  of  a  written  contract.    The  delivery 
must  be  a  complete  delivery,  and  the  accept 
ance    must   be   final,    unconditional,    and    ir 
revocable,  so  that  the  goods  will  be  reduced 
lo  the  actual  possession  of  the  buyer.    It  is 
not  necessary  for  the  accepting  and  receiving 
to  take  place  at  the  same  time.    One   may 
precede  the  other,  but  both  nuist  have  occur- 
red before  the  E-»ller  is  entitled  to  recover  the 
price;  for  so  long  as  there  is  no  absolute  and 
final  appropriation  of  the  whole  or  a  part  of 
the  goo<ls  by  the  buyer,  or  so  long  as  the  con- 
tract, by  its  terms,  may  be  avoided  by  either 
party,  or  so  long  as  eithi'r  party  has  a  claim, 
as  against  the  other,  upon  the  sub.jt  ct-matter. 
or  so  long  as  the  buyer  may  object  to  the 
quality  of  the  goods,  there  is  no  sutficient  ac- 
ceptance, even  though  the  possession  of  the 
goods  may  have  been  altered.    Story,  in  his 
work  on  the  Law  of  Sales  (section  276),  treat- 
ing on  tliis  subject,  says:    "The  acceptance 
must  be  final,  complete,  and  irrevocable,  and 
the  subject-matter  must  have  come  into  the 
.    absolute  possession  of  the   purchaser,   or  of 
some  person  authorized  finally  to  receive  it 
for  him.    An  acceptance  of  goods,  therefore. 


by  a  carrier  or  middleman,  to  take  to  the 
purchaser,  is  not  sutficient,  unless  such  car- 
rier or  middleman  be  the  authorized  general 
agent  of  the  piu'chaser,  because  such  a  de- 
livery and  acceptance  would  not  be  final,  so 
as  to  deprive  the  seller  of  his  right  of  stop- 
page in  transitu.  It  is  ncjt,  however,  necessa- 
ry that  there  sho\ild  be  a  mainial  and  ac- 
tual rec<'j)tion  of  the  goods;  for  if  a  com- 
plete constructive  possession  be  given  by  sym- 
bol, so  as  finally  to  bind  both  parties,  or  if 
a  final  appropriation  by  the  purchaser  be 
necessarily  implied  from  his  acts,  so  as  to 
destroy  all  right  to  avoid  the  sale,  or  to  obj;  ct 
to  it,  or  if  they  be  delivered  to  an  agent  or 
bailee  authorized  finally  to  accept  them,  the 
acceptance  will  be  sutficient.  The  only  ques- 
tion is  whether  the  contract  is  completely  ex- 
ecuted on  the  part  of  the  vendor,  and  as- 
sented to  finally  by  the  vendee,  so  that  the 
right  of  property  and  the  pf)sseijsion  are  ir- 
revocably changed."  There  has  been  much 
discussion  on  this  subject  by  jurists,  Init  the 
law  now  appears  to  be  well  settled,  both  in 
England  and  in  this  country,  in  accordance 
with  the  doctrine  laid  down  by  this  eminent 
author.  Under  this  broad  and  explicit  ex- 
position of  the  law  it  follows  that  a  delivery 
of  goods  to  a  common  carrier,  pursuant  to 
a  verbal  contract,  for  tlie  purpose  of  trans- 
porting them  to  the  buyer,  is  not  a  sutficient 
acceptance,  unless  such  carrier  be  the  agent 
of  the  buyer,  and  has  authority  finally  to  ac- 
cept them  for  him. 

In  Norman  v.  Phillips.  14  Mees.  ^;  W.  277, 
Anderson.  B.,  said:  "The  true  rule  appears 
to  me  to  be  that  acceptance  and  delivery  im- 
der  the  statute  of  frauds  means  such  an  ac- 
ceptance as  precludes  the  pm-chaser  from  ob- 
jecting to  the  quality  of  the  goods;  as,  for 
instance,  if,  instead  of  sending  the  goods 
back,  he  kerps  or  uses  them."  In  Knight  v. 
Mann,  118  Mass.  14.'?,  the  court  said:  "The. 
clear  and  unequivocal  acts  showing  an  ac- 
ceptance, or  from  which  an  acceptance  may 
be  inferred,  must  relate  to  some  dealing  with 
the  property  itself  by  the  buyer  or  his  au- 
thorized agent,  after  the  delivery  of  the 
whole  or  a  part  of  it."  1  Reed,  St.  Frauds, 
§  262:  Benj.  Sales.  §  130;  Baldey  v.  Parker. 
2  Barn.  &  C.  37;  Tempest  v.  Fitzgerald,  3 
Barn.  &  Aid.  680;  Mabcrley  v.  Sheppard,  10 
Bing.  99;  Carter  v.  Tons  ».int,  .".  Barn.  & 
Aid.  8j.">;  Smith  v.  Surman.  9  Barn.  &  C. 
.561;  Johnson  v.  Cuttle.  10r>  Mass.  447;  Hodg- 
ers  V.  Phillips,  40  N.  Y.  .519;  Cross  v.  0"Don- 
nell.  44  N.  Y.  6(>1;  Grimes  v.  Van  Vechteu. 
20  Mich.  410;  Taylor  v.  Mueller.  30  Minn. 
343.  15  N.  W.  413;  Frostburg  .Mnnuf'g  Co. 
V.  New  England  Glass  Co.,  9  Cush.  11.");  Al- 
lard  V.  Greasert,  61  X.  Y.  1;  Shepherd  v. 
Pressey,  32  N.  H.  49.  While  it  is  true  that 
in  many  cases  a  delivery  to  a  carrier  has  been 
held  suHicient  to  satisfy  the  statute  of  frauds, 
yet  in  most  of  those  c.ises  it  will  be  found, 
upon  examination,  that  there  was  either  a 
prior  acceptance  of  the  go<ids  by  the  buyer, 
or  that   the  statute  provided   for  an  accept- 


4)4 


STATLTI-:  OF   I-'KAUDS. 


iini-c  or  delivery,  or  that  the  earrier  was  des- 
i;:naletl  by  the  buyer,  and  selected  by  him 
for  the  purpose  of  roceivins  and  accept inj; 
the  jroods.  The  case  at  bar  must  be  distin- 
guished from  all  of  these  classes  of  cases,  for 
here  the^  law  riniuires  both  a  receipt  and  an 
acceptance,  and  there  was  no  prior  accept- 
ance l)y  the  i)uyer,  nor  was  the  carrier  des- 
i};nated  or  selected  by  him  as  his  agent  to  ac- 
cept the  j^oods.  The  plaintiff  delivered  the 
ptxxls  to  the  carrier  without  any  authority 
except  such  as  was  j,'iven  it  by  the  terms  of 
u  void  contract,  which,  bdns  void,  could  not 
empower  it  to  do  any  act  which  Avould  bind 
or  conclude  the  defendant.  What  the  plain- 
tiff did  is  entirely  immaterial.  The  defend- 
ant could  accept  the  goods  or  not,  as  it  chose. 


It  may  be  admitted  in  this  case  that  the 
plaintiff  fully  performed  its  part  of  the  ver- 
bal contract,  and  still  the  defendant  could 
refuse  to  accept  the  goods.  It  could  do  this 
arbitrarily  and  unreasouablj-,  and  without  as- 
signing any  reasons  therefor.  The  question 
is  not  whether  the  defendant  ought  to  have 
accepted  the  goods,  but  whether  it  did  ac- 
cept them.  1  Reed.  St.  Fi'auds,  §  liG;!;  Bon.j. 
Sales,  §  139.  We  think  there  was  not  a  suffi- 
cient acceptance  to  satisfy  the  statute,  and 
the  trial  court,  having  proceeded  on  the 
theoi'y  that  the  acceptance  was  sufficient, 
properly  granted  a  new  trial.  The  order  is 
affirmed. 

MINER  and  SMITH,  JJ.,  concur. 


WEST   PUBLISHING   CO.,  PRINTEBS  AKD    STEREOTYrEKS,  ST.  PAUL,  MINN. 


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